JC3
Posts: 290
Posts: 290
Posted:
We are looking for a new collection agent. Do you use your property manager, your attorney, or an agency?
What questions should we be asking of them?
What questions should we be asking of them?
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questions for collection agent
Started by JC3 • 4 replies • 1283 views
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JanP1 (Arizona)
Posts: 76
Posts: 76
Posted:
I'm a board member and we have looked at this question to.
Some of the things you need to discuss as a board are what message is appropriate to send to your home owners - a community with Million dollar plus homes - I would use a lawyer, but a community with homes 1/10th the price - a lawyer may appear to be excessive - but only your board knows the situation - high foreclosure rate - a lawyer may be the best to deal with the lending institutions. What message is your board trying to send?
Next question to answer: What will it cost the association? Some collection cost are billed to the homeowner, some may be to the association - depending on the level of collection/foreclosure you are going to. Our association, also shopped the fees they charge, because we did not want to send the message to our homeowners that we were trying to add pain to their situation. We just wanted the assessments for their share of the expenses.
3rd question: What do your state laws require (sorry should have started there). There may be specifics to your state regarding the language that must be in letters. - And look at the sample letters, what is the tone - what message is your board trying to send, do the letters match the tone?
4th question: Give me a reference of the last three associations collections transactions your firm/company completed - not your favorites, just the last three.
5th question: Do they offer free training for the board regarding collections including the national fair debt collections act. What to write and publish to the homeowners regarding a collections policy. What is the difference between judicial/non judicial foreclosure. What a board can and should do in bankruptcy situations....The list goes on, but the point is, they should train the board and manager, because once the contract for collections is signed - the board and manager may be required to have no contact with the owner regarding the collections, and you all need the same message.
6th question: Follow the money - when does the association get paid.
Those are just my initial thoughts I am sure there are others in hoatalk that will be able to help you as well.
Some of the things you need to discuss as a board are what message is appropriate to send to your home owners - a community with Million dollar plus homes - I would use a lawyer, but a community with homes 1/10th the price - a lawyer may appear to be excessive - but only your board knows the situation - high foreclosure rate - a lawyer may be the best to deal with the lending institutions. What message is your board trying to send?
Next question to answer: What will it cost the association? Some collection cost are billed to the homeowner, some may be to the association - depending on the level of collection/foreclosure you are going to. Our association, also shopped the fees they charge, because we did not want to send the message to our homeowners that we were trying to add pain to their situation. We just wanted the assessments for their share of the expenses.
3rd question: What do your state laws require (sorry should have started there). There may be specifics to your state regarding the language that must be in letters. - And look at the sample letters, what is the tone - what message is your board trying to send, do the letters match the tone?
4th question: Give me a reference of the last three associations collections transactions your firm/company completed - not your favorites, just the last three.
5th question: Do they offer free training for the board regarding collections including the national fair debt collections act. What to write and publish to the homeowners regarding a collections policy. What is the difference between judicial/non judicial foreclosure. What a board can and should do in bankruptcy situations....The list goes on, but the point is, they should train the board and manager, because once the contract for collections is signed - the board and manager may be required to have no contact with the owner regarding the collections, and you all need the same message.
6th question: Follow the money - when does the association get paid.
Those are just my initial thoughts I am sure there are others in hoatalk that will be able to help you as well.
DonnaS (Tennessee)
Posts: 5,671
Posts: 5,671
Posted:
JC3,
In addition to Jan's good post, each State has a collection process in the Laws. In Florida, we have to use a letter, then a certified letter. These first 2 steps are done by our PM. If we need to proceed, then a letter from our Attorney is written. If we get no results with that, then the Attorney goes the lien route. Every delinquency is given 3 chances before we start a legal means of collection. We are dictated this by the Statutes.
Collection agencies might be less expensive that an attorney initually but when they get no results, then it has to go to an attorney anyway so we just skip the middleman of an agency but each State is different.
JanP1 (Arizona)
Posts: 76
Posts: 76
Posted:
Good suggestion from Donna, which brings the next line of questions
What is their rate of return on collections - how long is the aging on their accounts when they receive them, and how long to completely clear the account.
What is the percent that are closed after the first letter, second letter etc.
What percentage go to notice of sale and sale.
What is their rate of return on collections - how long is the aging on their accounts when they receive them, and how long to completely clear the account.
What is the percent that are closed after the first letter, second letter etc.
What percentage go to notice of sale and sale.
RogerB (Colorado)
Posts: 5,067
Posts: 5,067
Posted:
JC3, we do collections. It is critical for the Association to have a good collection policy and all owners have been provided a copy. If the account needs to go to court for garnishing wages or foreclosing on the property an attorney is required.
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