Many collection groups are seeing a hard stop with the present COVID-19 Coronavirus issues. Debtors are less able to pay, courts are closed, and everyone is staying home. Agencies and collectors have a handful of things they need to consider to come out on the other side.
1. Get all legal matters as far along as possible- Have attorneys get through any process they can, draft complaints, send necessary letters, file online, etc. Have everything ready to file the day a court opens back up.
2. Get what liens you can in place ASAP- With the drastic reduction in interest rates, refinances are going to expand and companies and people will want to borrow money. Judgment liens will need to be cleared with the money borrowed.
3. Spend extra time on asset searches- skip tracing, and any other detailed online searching. Do extensive, deep-dive file reviews and drag all those old files out and get it all cleaned up. De-clutter office spaces and get ready to hit the ground running when you can.
4. If you can afford to do so- upgrade what you need to upgrade.
5. Offer discounted deals- Short-term cash may be necessary to keep some doors open and offer debtors the incentive to get what you can while they can afford to do so.
6. Keep your good employees happy- You may have to do some employment triage, but your best employees you are desperately going to want to retain on the other side. Give them the help or time off they need — be the employer they will want to come back to.
7. Train on new skills- Get less-experienced collectors extra training, talk through past scenarios, and get everyone to spend time wisely.
8. Think long-term as to what you CANNOT afford to lose. Get a plan together to keep doors open the next 90 days — 1 year.
9. Stay compliant- Short-term mistakes with illegal measures are going to lead to long-term problems. Don’t threaten suit for the next 90 days.
Plan and prepare. Short-term panic will lead to critical mistakes that may be alleviated with a deep breath and long-term thinking.
Conclusion: In the event of a COVID-19 Coronavirus, many collection groups are finding themselves with an uncertain future. Debtors can't pay their debts and courts are closed. However, there is still work to be done on both sides of this issue; agencies and collectors need to act quickly in order to come out on top when things start picking up again. The first priority should be getting legal matters as far along as possible by filing them before it's too late - have attorneys draft complaints or any other necessary letters so that they're ready for court opening day. Secondly, get whatever liens you can in place ASAP since interest rates will likely go back up soon enough!