COLLECTING PAST DUE ACCOUNTS - Notice of Listing
By Jim Finucan

The Notice of Listing law is aimed at regulating the actions of
collection agencies and their operatives. You should be familiar
with it even if you are a small business owner or work in the
accounts receivable department. Following the same rules as the
professionals do will help protect you from lawsuits.

Every collection agency is required to send a "Notice of Listing"
when they receive an account for collection. This letter is the
first word the debtor gets from the agency. It informs him that a
particular business has turned his debt over to a collection agency.

The Notice of Listing includes a sort of "Miranda warning" which
informs the debtor that this is an attempt to collect a debt and
that any information obtained maybe used for that purpose. If the
debt is going to be placed on the debtor's credit report, the debtor
must be given 30 days to respond before that action is taken. If
your Notice of Listing indicates that you are going to put the debt
on the debtor's credit report you cannot send the debtor anything
more for at least 30 days, during which time the debtor can dispute
the debt. To do this the debtor has to send a letter stating that he
disputes the bill. He does not have to give a reason.

At this point Fair Debt Collection Protection Act (FDCPA) rules
require a collection agency to send a validation of the debt. This
is an itemized statement or copy of the client's original billing.
Once this has been sent to the debtor you can begin taking action to
collect the bill. Be sure you do not take any action on the account
until you have sent the validation to the debtor. The debtor has the
right to request validation of the debt any time within 30 days of
its having been placed with the collection agency.

You can contact the debtor by phone within the 30-day period, but
you have to be very careful about what you say. You can ask for the
balance in full but you cannot demand it, nor can you threaten legal
consequences within the 30-day period. You can advise the debtor to
pay in full before the debt goes on his credit report, which
normally happens at the end of the 30 days. (This is a powerful
tool, by the way). You can also ask for information about the
debtor, just as you do in a regular collection call. Whatever you
say in a phone call in this situation must be put in the form of a
question.



Let 15-year collections pro Jim Finucan show you how to double the
money you collect from your accounts receivable. Check out his
unique collections manual "Past Due." For more information visit:
http://www.tiare.com/pastdue.htm