Due to the state of the economy, there is a larger amount of delinquent debt and a rising number of debtors refusing payment, leading more businesses to trust pursuit of debt to commercial collection agencies. It relieves the burden of the business to find the resources to handle the collection procedures in-house while still recovering necessary funds.

Why are these agencies so much more successful in the pursuit of delinquent debt than individual businesses? Why is more money recovered by this process of outsourcing than by keeping the efforts in-house?

As previously mentioned, the number one reason commercial collection agencies achieve greater success at recovering delinquent debt is availability of resources. Aside from sheer manpower and industry expertise, these agencies have a number of tools at their disposals which aid in the debt collection process.

Many such dedicated agencies use asset investigation as a tool to help recover delinquent debt. Knowing what a debtor has available that can be seized as collateral, or what the debtor may be able to sell in order to pay a debt on which they have previously defaulted, goes a long way in negotiating with the debtor to recover the sum due.

Face-to-Face Meetings – Phone calls do not have to be answered, and collections letters can be ignored. These traditional means of debt collection are too impersonal. With the available resources, commercial collection agencies are able to send representatives to speak to debtors in person, even at their place of work, which brings the reality of being in debt to life for the debtor.

Private investigators are also tools employed by these agencies. Regardless of an individual’s determination not to answer calls and attempts not to be found by bill collectors, private investigators can root them out and help the agencies in their pursuit of the delinquent debt.

In fact, these private investigators do not usually stop with discovery of the debtor’s location; they typically determine wages, debt, payments, and other personal information that can be helpful to collectors in pursuing the debt in question. This makes private investigators an invaluable resource for these agencies.

Because these agencies possess the resources and the knowledge to more doggedly pursue delinquent debt, commercial collection agencies enjoy greater success rates than in-house debt collection for the majority of businesses. In order to get finances back in order, businesses experiencing difficulties recovering delinquent debt may wish to consider this alternative.

Next, explore more important facts and resources on commercial collection agencies, in addition to collection agencies options.

In the last article of this series I described two different sorts of collection agents: in house collectors and third party collectors. In house collectors work directly for the creditor, while third party collectors work for a collection agency hired by the creditor to collect on delinquent accounts. I mentioned that third party debt collectors are bound by the rules and guidelines of the FDCPA, while in house collectors are not. The FDCPA stands for Fair Debt Collection Practices Acts and it is full of strict guidelines that third party collection agents must follow.

So, as you can imagine, many lawsuits spring up due to complications and confusions regarding debt collectors and the rules they must abide by: are they in house, or third party? Last article I brought up three examples, one being the Department of Education collecting on student loans. Anyone who works directly for the Department of Ed is not bound by the FDCPA, while the seventeen private third party collection agencies that it works with are. I mentioned a law suit about a hospital that sent out pre-collection notices to patients with medical debts. If the hospital was ruled a third party collector, everyone who received that notice would have been absolved of their debt. In this case the hospital was ruled a creditor instead.

Finally, I brought up a personal situation I encountered with an in house debt collector that is kind of silly and ridiculous but pertinent nonetheless. I am notorious for taking out books from my local library and never giving them back, so last summer it got to the point that they sent a collection agent after me! The collection agent called my third party house phone and left a message for everybody to hear about the intimate details of my “delinquent account,” and ask that either I return the books or pay the library for the cost of them. Fortunately for them, I love my library and was also aware of the fact that the collector was an in house, because she requested that I pay the creditor (the library) directly. I gave the books back, but let it be known that if I did not manage my finances as well as I do now, and had been called by a rude third party debt collector who did the same thing; there would have been hell to pay.

To determine if they are work with third party debt collectors or in house collectors in court cases, the courts will take a lot of ideas into consideration to rule if the FDCPA applies or not. If the creditor hired a collection agency outside of its company, the agency’s participation in the actual debt collection process must be minuscule. Questions the court will ask include: is the collection agency only a mailing service? Do they letters say if the debtor does not pay the debt will be referred for collection? (Third party collection agencies send out different letters, in house collectors send out these “warning” letters.) Is the collection agency only paid for sending letters?

If the collection company is paid on commission, it is probably a third party collection agency. Again, if the agency gets the payments and then forwards the payments to the creditor itself, it is probably a third party collection agency. If a debtor does not respond to the letter and the collection agency has no further contact with the debtor, or if it does not get a hold of the files on the debtors, it is most likely not a third party collection agency. The lesson to be learned here is that when it comes to personal finance, it is important to know who you are giving your money to. A simple question as to whether you are speaking with a third party debt collector or an in house collector can guide the conversation because you will know their limits, like in the case of me and the library, or all of those people in the hospital that might have gotten away with not paying their medical bills.

Mallory Megan works for Rapid Recovery Solution and writes articles on commercial collection agencies This article, The Difference Between Third Party And In House Debt Collectors And Why It Pays To Know Who You’re Paying Part Two has free reprint rights.

In today’s recession the changes seem overwhelming. Just last year some tax laws were created to bail us out of dire situations. These are a few new tax laws that you should know about.

The first deals with new car sales and tax deductions. If you purchased a brand new vehicle, including a motor home, light truck, motorcycle, or car on or after February 16th 2009 and by December 31st 2009, any excise or sales tax paid could be seen as a deduction.

In 2010 as well as 2009 the American Opportunity Credit replaces the Hope Education credit. This new credit is worth $2,500 per student, this is based off the first $4,000 of qualifying educational expenses.

People who have homes that make improvements to their them that are energy efficient have the ability to claim a credit of 30 percent of the cost of all of the upgrades, up to a maximum credit of $1,500. This covers things such as adding insulation, energy efficient exterior windows and energy efficient air conditioning and heating systems.

The past year was rough for an amount of workers, and layoffs hit record levels. However, unemployment compensation is looked at as taxable income. But now, the first $2,400 in benefits is excluded from income.

Because of the Bicycle Commuter Act, cyclists will receive reimbursement of workplace transportation costs into a tax favored account and bikers can utilize the cash to put towards purchase of a bicycle, helmet, bike lock, bike parking fees and general bike maintenance.

Also, if you pay your income tax by credit or debit card, you can deduct the convenience fee that will be charged for the transaction. The card fee, as well as any other IRS approved miscellaneous deductions must exceed 2 percent of your adjusted gross income before they will count. Despite the fact that this measure limits the value of this break for many, filers with substantial expenses to claim should be sure to add the card fee.

Mallory Megan is employed by a debt collection company. Also she writes articles on business, finance, the credit industry and collection agencies. Unique version for reprint here: Some Recent Changes In Tax Laws That You Should Know About.