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Some states, California for example, do not currently require one to be a lawyer or get a license to be a collection agency to collect most debts or to recover the judgments they own. Could an average (non-attorney) person start a company recovering debts that aren't judgments yet? Yes, however it is much more difficult to make a profit doing that than many folks would believe. This article is my opinion and is not, legal advice. I am a judgment broker, and not an attorney. If you want a strategy to use or legal advice, you should contact an attorney. Entrepreneurial debt recovery experts most often have the creditors assign their debts to them having a signed contract first, and then the collector will either attempt to convince their debtors to make payment using the telephone or letters, or they sue them to get their judgment based on that debt claim. There is at least one website selling a product to help people learn to be a collection agency, using just their web site. A downside with this concept and product is the majority of debtors and judgment debtors don't respond to letters they get. Debts which aren't judgments yet cannot be recovered through a court. Not having a judgment, you can't pay the Sheriff to garnish the assets of their debtor. Be aware that when recover non-judgment debts you buy on a future-payment basis or outright, you're collecting debts, not final judgments; and you'll be a 3rd-party debt collector subject to the FDCPA statues, and the Rosenthal restrictions in California. If you are not an attorney, you cannot represent others in a court matter, unless you are a collection agency; in which case you represent just someone's right to attempt to collect that one debt or judgment. While California doesn't currently require a collection agency license, many states require folks to be licensed and bonded to recover debts and/or judgments. Whether a state requires bonding and/or licensing or not, every debtor circumstance needs to be scrutinized and screened, to get any opportunity to earn money. Not having judgment, you will not be legally permitted to run a credit report on the debtor, and a debtor may apply for bankruptcy protection on any business day. You can use professional data services to check debtors of the possible debt owner customers, to help minimize the financial risk. If your debtor doesn't respond to phone calls and letters, the solution might be to sue them to try to make them a judgment debtor. The expense and hassle of suing your debtor makes sense if they appear to own available assets. In most states, including California, that can't be done in small claims court, so that can be expensive. While a few debtors might settle without suing them, you might need to sue most of them. In California, this most often costs between $275 to $500 to sue someone in civil court, including serving your debtor notice of the lawsuit, and much more money if you retain a lawyer. If your lawsuit is not contested, there will not be any additional lawsuit expenses; however if the debtor contests your lawsuit, the expenses might be so much that you will want to dismiss the lawsuit. Could you make money collecting debts? My answer is perhaps. One stop shopping judgment recovery: http://www.JudgmentBuy.com - Judgment Recovery. Your easy, free, fastest, and best way to begin recovering recoverable judgments. (Mark D. Shapiro 408-840-4610) No obligation, free judgment evaluations.
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Recovering debts, debt collection, collecting debts, becoming a debt collector, debt recovery,
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