The disclaimer “past results do not guarantee future performance” is true of many things including the recovery rate for commercial debt collection.
A prospective client asked if I maintained statistics of our past NY Debt Collection claims. Whether he wanted to size us up, confirm the likelihood of collecting his claim, or both, the question was direct and a good one.
If you try searching collection rates for collection agencies and attorneys or general statistics of debt collection recovery, you won’t find many results.
When I tried the search a few years back and again this week, I was unable to find statistics of recovery on debt collection claims, in NY or anywhere else by third-party debt collection agencies or attorneys.
I Googled “statistics of new york debt collection claims,” “collection rate of New York debt collection claims by collections agency” and “percentages of recovery in NY debt collection claims,” and found very little.
For internal reasons, we were encouraged to calculate our rate of recovery for various industries. By calculating our recovery on “collectible” NY debt collection claims, we could assess our performance in various industries.
Curious and a bit concerned as to why no one else was posting their rates of recovery or statistics, we took a deep breath and posted the results on our site.
What Affects a Claim’s Collectability?
The thing is though, past performance does not guarantee future results especially when it comes to NY debt collection. Here’s why:
- Every claim is unique
- The age of each claim differs
- Some creditors maintain better records to document their claim than others
- Out-of-state creditors not authorized to do business in NY may be at a disadvantage
- Your customer’s ability to pay differs from another
- Your client’s willingness to pay differs from another
- The court where you bring your debt collection case may have more delays than others
- You are caught up in motion practice
- Delay hampers collection
- Your customer is indicted or goes to jail
- Your witness is unavailable
- The records have been destroyed
- You do not have the time to spend time chasing bad debt
- There was an issue with the goods or services
- Your customer filed a bogus counterclaim against you
- You may need to mediate before you can litigate
- The customer is slicker than others
- Your customer’s assets may be encumbered and there is nothing to collect at this point
- Your customer may have gone out of business
- The statute of limitations has expired and you are too late to collect your claim.
There are so many variables that could impact your case the list could go on forever. That is why you need to make sure you have an experienced debt collection attorney on your side to guide you and your claim through the process. To evaluate the collectability of your claim, contact FFGN.