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Enhanced Recovery Rates
Collection agencies often achieve higher success in recovering overdue payments compared to landlords’ efforts. They employ a variety of effective tools and strategies, including advanced systems, skip tracing, analytics, and a combination of letters, calls, texts, and emails. Additionally, reporting overdue accounts to credit bureaus has proven to significantly boost recovery rates over time.
4
Contingency and Flat Fee Pricing Models
Many rental collection agencies operate under a contingency fee structure, meaning landlords only pay a percentage of the recovered funds if the agency succeeds in collecting overdue payments. Such agencies handle the costs of collection efforts themselves, employing strategies to maximize compliance and payment. Alternatively, some agencies offer flat fee pricing, where landlords pay a fixed amount upfront for a series of collection letters sent over a specified period, typically lasting 60 or 90 days. Payments collected during this timeframe are retained entirely by the landlord. However, this model generally excludes more advanced services like collection calls or skip tracing.
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