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How Can I Help my Business Experience Profitable Growth?

It won’t surprise you to know that one of the top concerns of most CEOs is profitable growth. Profitable growth occurs in businesses where the leaders focus on the organizational culture of the business, the people involved in the decision-making and whether or not the vision and strategies being proposed are completely understood and embraced. They also consider new Cash Flow 3ways of influencing more cash flow, which in some cases involves accounts receivable management processes through a third party.

The organizations that aren’t making the kind of growth they want are probably not working with the right people and/or don’t have the organizational structure in place to drive profits. They are probably lacking the connection to a third party that can provide professional debt collection services.

Businesses that have experienced profitable growth are often less focused on various management approaches that focus on growth. They’re more focused on business activities that lead to success, some of which are tied to how they handle receivables and debt management.

Most businesses rely on their employees to be their strongest asset, yet finding these talented individuals is often their biggest obstacle. Once the right staff is on board, they need to be free of cumbersome bureaucratic processes that stymie growth. A good many businesses are too slow to recognize these failed processes. In some cases, it’s the processes involving billing and accounts receivables that gives them headaches and slows their rates of profitable growth.

Most industries today offer credit to clients. Whether it’s in the medical, educational or retail industries – in order to see more business growth, companies are extending credit to their clients. It works. These companies are opening up new lines of revenue, but not without some risk. Most companies aren’t paid in full for an average of 50-plus days, which can really hamper cash flow and profitable growth of the business.

Business leaders know that growing their organization requires cash, and it’s not always flowing in a positive direction at critical times. One way around waiting 50-plus days for their money, some businesses have gone with factoring provided by a third party. By selling their receivables, they get their money immediately for a small fee. They don’t have to waste man-hours on billing and waiting for payment to come in a month later or three months later. Employees are no longer saddled with paperwork. They can instead work toward growing the business.

By selling receivables to a third party, businesses also relinquish any fear of having to deal with bad debt collection, which can be a massive undertaking for companies with employees who haven’t been properly trained in the practice of collecting debt. It’s a potentially touchy situation that can paint a negative image on the company brand if not handled correctly.

Omega-RMS, llc., is a company that has time and time again proven that they can faithfully recover debt while upholding the image of their clients. Omega’s accounts receivables management solution is at the heart of its mission. Early intercept recovery and contingent collection services are also solutions that Omega is poised to provide.

Recovery Services: Recognize When You Need Help

Business owners constantly ask themselves why their clients continue to neglect their invoices.Debt 4 The answer could be as simple as – because the clients believe they can do it without any recourse.

That’s often the case, as many business owners have no debt recovery services in place because they think going after debtors will create a negative environment. These non-payments add up and can cause serious cash flow issues for small businesses.

Consumer debt in the U.S. was more than $11 trillion earlier this year. A percentage of that debt will never be repaid. Debt collection agencies are able to collect around $55 billion a year. When businesses don’t recoup their losses from non-paying customers, they have to raise the price of their products/services. Using 2010 as an example, if the debt collection industry hadn’t recouped the $54.9 billion, it’s estimated that the average household would have paid $400 more for goods and services than they actually paid.

Businesses can protect themselves by standardizing their business practices. Businesses that draft contracts with their clients have less of a chance of customers not paying their bills. The contract spells out what’s expected of the client for services rendered. The client has piece of mind that the contract also spells out the responsibilities of the business. The contract also determines how payment will be made and when. Down payments are a good way to protect against total losses.

Recovery services are often needed when debts go beyond 60 days unpaid, but many businesses make the mistake of getting behind on their billing notices. Consumers need reminders, and businesses that have a prompt and efficient billing service have better rates of success in receiving payments on time.

What are your rights when it comes to collecting on unpaid debt? Many business owners don’t investigate this very thoroughly and either avoid debt collection all together or pay big fees to their attorneys. Companies that partner with a debt collection agency often have built-in legal resources within that agency. Most recovery services are multi-functional firms that include expert legal teams as well as professional debt recovery agents that know how to effectively communicate with debtors.

Joining a professional organization that fits your industry is also an action that produces results. Many professional organizations have a large group of fellow business owners who can offer advice on how to avoid the problems with non-paying customers.

Most of these club members will tell you that you should contact a debt collection agency before debt gets too old. The older the debt, the harder it is to collect. Many businesses have a policy of sending bad debt to collections somewhere between 60 and 90 days of nonpayment. Professional debt recovery services have the tools and knowledge to track down the debtor, make contact and establish a repayment option that will get them back on schedule.

Omega-RMS, llc., has many years of experience in professional and ethical debt collection practices that have proven very valuable to its clients. Specializing in education, medical, consumer products and membership organizations, Omega has a full range of options that suit almost any type of business.

Bad Debt Collection Agencies See Young Adult Debt Delinquency Increasing

Millennials are a skeptical and cautious generation. They aren’t huge advocates of credit Credit Cards 1cards or debt in general. While they have an average balance on cards lower than any other generation, they are increasingly not making payments on time, which often takes the interaction of bad debt collection agencies to bring resolution to the matter.

A recent analysis by Experian shows personal loan debt, which includes student loans, personal loans, credit card and car loans, averages around $28,000 per person. Most people have two credit cards with an average balance of $4,500. Millennials, however, have credit card debt of $2,700 and overall debt of $23,000. People in their 30s up to age 46, known as Generation X, have the highest average debt, which is around $30,000.

Despite their low debt loads, Millennials have lower credit scores. The average American has a credit score of 681 to Millennials’ 628.

One reason for the lower credit score, aside from the propensity to pay late, is that they have lower limits, which max out faster than consumers with higher credit limits. Another strike against their credit scores is the fact that these younger consumers haven’t developed a very rich credit history. Older generations didn’t have the Credit Card Accountability Act, which makes it difficult for consumers under 21 to qualify for a credit card. Parents can still co-sign and get their 18-year-olds a credit card.

Millennials need to know that there are various factors that contribute to their credit rating. Keeping balances low, keeping the number of credit cards low is important, especially revolving accounts. Paying bills on time is an obvious factor that’s very important to keeping credit scores favorable. Many Millennials don’t know they have bad credit until it’s the attempt to move into a new apartment, at which time their credit score shows them to be a bad candidate. A sure sign that they’ve not held up their end of a financing agreement is when bad debt collection agencies begin to call.

Companies doing business with Millennials might have a difficult time getting them to sign up for their third-party financing arrangements due to the fact that this generation is not as credit-focused as others. However, given the future buying power of this generation, and given their current habits regarding paying down their accounts, it makes sense to partner with a collection agency that can protect your investments.

Connecting with a reputable agency does a lot more than recover your lost receivables; it also helps protect your reputation. The best agencies will work with your clients to ensure that they are treated with respect and professionally.

Omega-RMS, llc., is one of the industry’s leading providers of contact campaigns and third-party receivables solutions. Some clients choose to skip the accounts receivables labor and pass it on to Omega, which means Omega pays them immediately and there is no wait for monthly installments that may or may not come on time.

How Overdue Payments Can Affect Your Medical Practice

According to a report from NerWallet Health earlier this year, the biggest cause of bankruptcies Bankruptcy 1in America today isn’t credit cards or mortgages – it’s a result of unpaid medical bills. Roughly 2 million people will be affected this year alone.

Medical practices need to be proactive if they want to receive the money for which they’ve worked hard. Every medical practice is impacted at one point or another by unpaid bills. Cash flow is negatively impacted, especially when terms of payment haven’t been specified with patients. There are actually several steps a medical practice can take to lessen the impact that overdue payments cause.

Patients need to know first and foremost when their accounts are due. Medical bills aren’t on the top of the list for most consumers to pay, so make certain they know exactly when the payments are expected. Even with the most effective billing practices and collection efforts, not every account will become current. When these can be identified early, call in a collections expert and have them work their strategies to regain that lost money.

Are you making enough contact with your clients? You can call them more than once a month to see when they can get current on their account. Slow-paying accounts need encouragement to pay on time. Reminders often do the trick. To keep them from falling way behind, they might need to be called every week. This can be a strain on the medical practice’s staff, which is why many facilities hire collection agencies to do the calling for them.

Many medical practices fail to bring in a collection agency early enough. The use of a third party to collect debt makes a lot of sense for many reasons, the first of which is that they are professionals and know how work out a payment agreement that works for the consumer. Don’t wait past 90 days to bring in the third-party to collect overdue payments. The earlier the collection agency can make contact with the debtor, the better chance they have of collecting debt.

Medical practices are focused on providing the best patient care possible, which means they might not be experts in rules and regulations regarding collection laws. Many states have the same laws for businesses as they do for collection agencies. Falling out of compliance with these laws can result in fines and poor public perception of your medical practice, which is another reason why calling in professionals to reclaim money owed to you, is a good decision.

When medical practices partner with Omega-RMS, llc., they’re teaming with a group of professionals who have the latest technology at their fingertips and the best training available to communicate with your clients. Some practices are afraid to bring in a debt collection agency because of the negative association clients will have with the practice. Omega does what they do so well that they can actually improve your public image while reclaiming your money.

When is it Time to Collect on Past Due Accounts?

It’s no wonder that businesses worry about past due accounts – nearly 70 percent of them that High Debt 1go beyond the 90-day mark are never collected. Knowing when to step up collection efforts can reduce the amount of receivables lingering in the overdue file.

Unfortunately, most small business owners struggle not only with when to go after overdue accounts, but how to go after them. Past due accounts create a fair amount of confusion in business owners because while they need that income to grow their business, they don’t want to come off as demanding in their efforts to collect. Many fear that if they push too hard, they’ll develop a bad reputation and lose business.

Business owners who have been there before and have found a solution advise others to develop an internal policy and procedures that address the subject of past due accounts. The procedure will include a list of items that must be carried out, such as when the first letter should be sent to the client advising them that their account is past due. Most small businesses will send out that letter within 30 to 45 days after the bill is past due. One effective measure involves following up on the letter with a cordial phone call.

At the 60-day point, it’s time send another letter (some will send a second letter at the 45-day point). This letter will request that payment be made in full or that the company is willing to meet with the client to determine why they can’t pay. Offering a payment plan is also an option at this point.

Should these measures fail to produce a payment out of the client, one final letter should be sent that advises them that failure to respond will result in your company exploring “any and all options” to collect on the debt. This could include litigation. As a general rule, most companies will take a client’s account to a collection agency if the total is $500 or less. Attorneys handle larger amounts as they can take judicial measures like wage garnishment to collect on the account.

Sending the account to a collection agency is a good course of action because it usually results in more positive cash flow. Collection agencies are professionals at recovering debt in an ethical manner that will not hurt the public image of the company they represent. The industry is highly regulated, which means falling out of line with government regulations results in harsh fines.

Most companies have a difficult time tracking down debts that are 90-plus days old. They don’t have the expertise to find the debtor, nor do they have the experience required to successfully arrange payment options if they actually do get lucky and find the debtor.

Omega-RMS, llc., is a company with four decades of experience in collections and account receivables management. The professionals at Omega have a variety of tools at their disposal and the expertise to use them to a positive end for their clients.

Business Owners Are Positive About Economic Outlook: Payment Recovery is a Step in the Right Direction

Credit Score 1A recent study by TransUnion asked participants to rate their understanding of credit scoring models, which are used any time consumers buy a home, car or apply for credit, either through a big bank or through retail stores. Nearly 70 percent indicated in the study that they have
no understanding or little understanding of the credit scoring process.

The credit score is often what stands between the consumer and the goods they want to purchase. For lenders, the score indicates the probability of that consumer paying back the
loan. Credit reporting companies use different scoring models, which is why one person’s score can have a range of numbers and can cause some confusion.

Most scoring models look at payment history, which shows late payments as well as on-time payments, the latter of which can improve credit scores. High balances can be a detriment of lower a credit score. A goal to keep in mind on this front is to stay below 35 percent of the total credit available. A lengthy credit history shows less risk, especially if the history is clean. Every time a creditor checks on the credit score of a person or business, it causes a
slight drop in the score, which is why applying for credit as little as possible is a good idea. Most creditors are looking for a client that has a variety of credit types and loans on their record.

Despite the apparent lack of visibility into the credit score process, fewer Americans are taking out large debt on traditional credit cards and going with more retail-based credit cards. Consumers and businesses that work hard to pay down their accounts are helping to reassure business owners that the economy is turning around. But payment recovery efforts are still needed to increase cash flow.

Payment recovery solutions from professional debt collection agencies offer what a credit-scoring agency can’t, which is the ability to collect on unpaid debt. Regardless of the credit score, some accounts don’t pay on time. The longer the account goes unpaid, the more difficult it is to recoup those funds. Companies can send out letters and make calls on their own behalf, but the success rate is not promising.

Payment recovery solutions might include accounts receivables management, which some agencies will offer. This is a process where receivables are purchased for a fee, which means the company gets paid immediately and never has to worry about an account going past due.

The economy can’t recover when consumers don’t spend or when companies offering credit don’t get paid, which is why debt recovery agencies like Omega-RMS, llc., are a vital resource in giving business owners a more positive outlook on the conomy. Omega has the expertise and the equipment to reclaim lost revenue, giving business owners a leg up on their growth potential.

Changes in Loan Servicing Debt For Student Loans Over Time

The process of collecting on student loans has evolved over time. Now that student loan debt Student Loan 1has surpassed $1 trillion, which is more than what Americans owe on credit cards, maybe it’s time to recap the regulatory changes that have taken place and the options students have today in repaying their debt.

Almost 20 million Americans attend an institution of higher education every year. About 60 percent of them borrow money to get through school. Most of the money they borrow is in federal student loans, about $864 billion. Another $150 billion is in private student loans. In 2012, the average debt load was $24,301 per student, but that number is growing.

With 10 percent of borrowers owing $54,000, there are a large number of people struggling to repay their college debt, which is delaying life choices that the generations before them were able to make right out of college. Buying a house, getting married and starting a family have all been put on the back burner while Americans with heavy student debt loads focus on repayment.

But not everyone can make those monthly installments. At least 14 percent of borrowers have at least one past due payment hanging over their heads at any given time. Approximately $85 billion is past due. The default rate rose to 9.1 percent in 2010, according to the US. Department of Higher Education.

Back in the 1970s, collecting on student loans was not a complex task. It was actually similar to collecting on pretty much any other type of debt. The debt collector would make repeated attempts to contact the debtor, and once contact was made, a payment arrangement was made. This was the process until 1993 when the omnibus Budget Reconciliation Act was passed. The act introduced wage garnishment to collecting defaulted student loans. It also wiped out the statute of limitations on old debt, which means borrowers who failed to pay back their loans from the early 1960s were once again fair game for collections.

Loan rehabilitation was offered in the late 1990s, which allowed defaulted accounts to get out of default after 12 monthly payments were made on time. After completing this payment schedule, the student’s credit score reflected no default history. However, Congress amended the law in 2008 to allow students to rehabilitate a loan one time only, as many students would get out of default and then fall right back into it.

Educational institutions offering loan servicing and third party financing also need protection from defaulting students, which is where professional debt collection services come into play. Students unable to obtain federal student loans often seek out another financing resource, which generally involves short-term loans. When those accounts come due but no money changes hands, debt collection agencies have the means to work out repayment plans.

Omega-RMS, llc., has experience working with educational institutions, offering innovative solutions, including loan servicing, to keep them from falling behind on accounts receivables, and students from falling into default.

Bad Debt Collection on the Rise as High Medical Expenses Lead to Credit Card Debt

A national survey carried out in 2012 shows that people need more options in paying down their Medical Bills 2medical debt.

The survey proves what many already know – medical debt is forcing too many Americans to pay for necessities with credit cards. While the average credit card debt has declined, low- and moderate-income households are putting their medical debt on credit cards. The average amount, according to Demos’ National Survey on Credit Card Debt, was $1,678.

Americans had an average credit card debt of $9,887 in 2008, prior to the recession. It has dropped to $7,145. The problem is that about 40 percent of households are using those cards for basic expenses, something any investment advisor will warn against.

A representative from Demos, which is a non-partisan research organization, said the public’s reliance on credit shows that citizens need policies that keep working citizens from making enough in wages to pay for their medical expenses and everyday necessitates without
using credit cards.

Around 60 percent of citizens site medical expenses, which they paid out of pocket, for their mounting credit card debt. In the last three years, almost 40 percent of households experienced tighter credit, like having their cards canceled or limits reduced. They are also having a more difficult time getting approved for credit. About half of these households who have had their access to credit limited said they would be using it today if they could.

The minority groups are getting hit particularly hard. Nearly 45 percent of African Americans and 55 percent of Latinos describe their credit as excellent or good. The overall percentage describing their credit situation as excellent or good is 62 percent. Around 55 percent of people with poor credit say that unpaid medical bills have killed their credit, leading to an influx of bad debt collection calls.

Congress has considered relief for the damage medical bills caused to consumers’ credit. Driving the relief efforts is the statistic that more than 70 million Americans have had medical debt problems due to medical billing problems. A coalition of consumer groups recently found that as many as one in 10 medical claims had errors. Furthermore, about 25 percent of Americans have overdue medical bills.

There is a measure in the Fair Credit Reporting Act that bars credit agencies from taking medical debt into account when considering an application for credit. However, creditworthy consumers are often denied credit or pay higher rates because of the debt related to medical bills.

Regardless of the errors, there are a very high percentage of businesses losing money to unpaid accounts that were billed correctly. These businesses are counting on third-party debt
collection agencies
to solve the problem. Bad debt collection professionals are assisting in reducing that gap between delinquent consumers and those who pay on time.

Omega-RMS, llc., approaches debtors with professionalism and respect and works out plans for repayment. This not only pleases the clients, but assists the consumer in digging their way out of debt.

Forward Thinking Retailers See Increase in Consumer Credit Card Debt

Attitudes toward finances changed as consumers emerged from the recession. The use of credit cards fell while the recession was in its worst stages, but use has climbed recently. Consumers are actually using retail cards more than big bankcards. Retailers are enjoying an influx of revenue generated by the credit extended to customers, but they’re also exposing themselves to risks that could require debt collection agencies to assist.

Nineteen of the top 25 metropolitan areas in the U.S. are seeing bankcard balances stay flat or decline while retail credit card balances go up. Retail cards are at nearly 90 percent of their pre-recession balances while bankcards are just under 60 percent. Consumers are not as willing to take on debt tied to banks. However, with promotions tied to retail cards, like when a consumer receives a big discount on the items they purchase on the day they apply for a card, consumers are finding more incentive to go with credit offered by their favorite retailers.

It takes some forward thinking for businesses to climb out of the hole they found themselves in during the recession. Convincing consumers to part with their money is a tough sell as the recession-weary public is just now starting to gain more income. Many companies saw a chance to create cash flow by offering credit for their products and services. Some chose a third-party financing group to assist in these efforts. They’ve also taken on third-party debt collection agencies to help them recover what they’re losing to clients that don’t honor their account agreements.

Many of the retail outlets are offering credit to consumers that can’t secure a card through more traditional services, such as banks. For the consumers hit hardest in the recession, an opportunity to make purchases on credit is a major incentive, which is another reason economists believe credit cards from retailers are on the rise compared to those from banks.

Equifax Personal Solutions President Trey Loughran said recently that the rise in retail credit card debt is an indication that consumer confidence is on the rise. He also mentioned that carrying over credit card balances could lead to a situation where consumers overspend. Missing monthly payments follows overspending, which means companies offering credit will begin to see a lot of money tied up in receivables. In the business-to-business realm, the average time it takes to pay off an account is already at 54 days, so businesses are seeing cash flow problems as a higher percentage of their income is tied up in receivables that are slow to arrive.

Omega-RMS, llc., is one of the leading providers of strategies that assist companies in regaining their receivables. Offering accounts receivable management to forward thinking companies is helping them with their cash flow and to grow. The contingent collection services is also an option for companies that don’t want to sell their receivables but need assistance in reclaiming money owed to them by debtors who are behind on payment. Omega has the professional staff to handle the problems these companies face in getting back what is theirs.

CFPB Looks to Consumers on Updating Loan Recovery Regulation

Collections 3The Consumer Financial Protection Bureau (CFPB), which is the governing body overseeing debt collection agencies in the U.S., issued an advance notice of proposed rule changes to the Fair Debt Practices Act this week. It’s now looking for feedback for proposed rules it is considering on the debt collection industry.

The public will have 90 days to comment on the new regulations, which are focused on updating legal framework within the act. The bureau is looking for comments from consumers, debt collectors, debt buyers and consumer advocates regarding what regulations that control the industry currently work and what could use some updating.

Specifically, the bureau is interested in three areas – the communication tactics used by loan recovery groups and debt collectors, the level of understanding consumers have of their rights and the accuracy of the information that collectors have on debtors.

The CFPB hasn’t been specific on exactly how it will govern rulemaking, an official recently said that they will likely focus on first party debt collection and creditors. Creditors that use in-house collections are not held to the Fair Debt Collection Practices Act. However, the CFPB has been fairly vocal in its opinion that creditors should be held to the same standards as debt collection agencies.

However, creditors and third-party debt collection companies are held to the regulations in the 2010 Consumer Financial Protection Act. The CFPB issued a news release in July reminding these entities that they are to be held accountable for using unethical and illegal tactics, such as using abusive language or deception in their collection efforts.

The CFPB recently released approximately 5,000 debt collection complaints filed since July. In its semi-annual report to Congress, the bureau said that through its enforcement, they have refunded more than $750 million for consumers who were in contact with debt collection agencies that used unfair practices in their efforts. Furthermore, the bureau has put more than $82 million in a Civil Penalty Fund, which is used to offer assistance to educate and compensate consumers who have been violated.

At the heart of the mission of the CFPB is a dedication to consumers, that they be treated fairly, whether it’s by debt collection agencies or in credit reporting. Reputable loan recovery and debt collection agencies applaud the efforts of the CFPB in weeding out the organizations that don’t follow the rules yet are often rewarded for their unethical mistreatment of consumers. The CFPB has a hefty task at hand as thousands of complaints roll in to their offices.

Companies needing the services of professional debt collection agencies reap the benefits of doing their research before choosing an agency. When they choose wisely, they get a firm that represents them well and helps to boost their public image rather than have multiple complaints filed on them. Omega-RMS, llc., is a loan recovery and debt collection company that has four decades of experience in treating consumers with respect while recovering money for their clients.