How to become A Debt Collector

• Bill Collector 
• Debt Collector 
• Collection Agent 
• Overdue Bill Collector
• Account Collector
• Collection Agent
• Doorstep Collector
• Field Agent

What do Debt Collectors do?

A Debt Collector would typically need to:

• Pursue, negotiate and reclaim debts of varying amounts owed by businesses or individuals to organisations, applying their knowledge of financial strategies, processes, laws, and bankruptcy 
• Use the bad debt files that creditors share with them to identify and locate consumers and businesses with outstanding payments
• Discover and understand the reasons behind non-payment to help with negotiations
• Track down out-of-date addresses; conduct background checks of debtors’ finances and assets using court records, public databases and other means
• Inquire with the debtor’s employers about the debtor’s employment status and wages
• Inform debtors via phone or email of outstanding credit and try to convince them to repay debts and overdue bills
• Call delinquent debtors at home or work to enquire about their financial situation; begin the process of arriving at mutually suitable solutions to debt repayment
• Explain legal procedures, such as bankruptcy or foreclosure, to help debtors understand and evaluate their options
• Review terms of contract or sale with debtors and offer credit advice as required
• Negotiate realistic repayment plans with debtors, such as small instalments over several weeks or months, based on their financial constraints or capacity 
• Maintain contact with the creditor to confirm acceptability of payment plans settled upon with the debtor
• Contact third parties who may be liable for debt repayment, such as former business partners or family members
• Record conversations with third parties as evidence, with the consent of all involved, in case debt repayment becomes a dispute
• Deal with debt collections that enter the legal system, following all protocols

If you are a bill and account collector, you may be located in a call centre, working for a third-party collection agency or work directly for the creditor, including credit card companies or healthcare providers. Debt Collectors may work individually or in teams. They typically work in pleasant and well-lit rooms equipped with computers. They use and update databases and make calls or send emails to locate debtors and negotiate with them. 

Field workers may work from home or make field visits for a large part of their work, tracking down forwarding addresses and calling on debtors at their offices or homes. They may receive a car or reimbursement for using one on their own or travel costs from their employers.

The work environment can become stressful because some debtors tend to become angry and aggressive or resist any attempts at communication by Debt Collectors. 

Debt Collectors work full time, from 9 a.m to 5 p.m, Monday to Friday, about 35-40 hours per week. You may need to give extra hours to fulfil monthly collection targets. However, you must keep your timings flexible since some debtors may be unavailable during the day and will require you to work weekends or evenings. Eventually, Debt Collectors can identify the optimal time to call a particular debtor to be able to plan their work schedule accordingly. 

Finding a new job might seem challenging. Debt Collectors can boost their job search by asking their network for referrals, contacting companies directly, using job search platforms, going to job fairs, leveraging social media, and inquiring at staffing agencies.

Debt Collectors are generally employed by:

• Financial Organisations
• Retail Companies  
• Debt Collection Agencies

Professional associations and organisations, such as the ACA International: The Association of Credit and Collection Professionals, are crucial for Debt Collectors interested in pursuing professional development or connecting with like-minded professionals in their industry or occupation. Membership in one or more adds value to your resume while bolstering your credentials and qualifications.

• The absence of automation leading to the use of inefficient manual processes that may lead to communication mishaps that disrupt workflow and higher chances of error
• Reliance on multiple platforms to collect debts, process payments, and take other expensive measures
• The strain on IT resources that can stall a Debt Collector’s performance
• The difficulty involved in settling debts based on oral contracts instead of written agreements
• Poorly drafted, unclear or misunderstood terms and conditions in written contracts entered into between the creditor and debtor that make assessment difficult 
• Lack of real-time collaboration between debtors and collectors, leading to delays and a long-winded process
• Lack of debt collection tools to ensure a proper analysis of debtors to be able to generate a suitable repayment arrangement
• Chances that debtor bankruptcy may indefinitely delay the process of debt collection 
• Debtors getting annoyed by repeated calls from debt collectors
• Inefficient collection processes that waste the time of all stakeholders
• Paying attention to detail and asking questions
• Keeping up with the use of mobile devices to contact multiple clients and debtors
• The lack of a classification of debtors based on income and other factors

Most newly hired Debt Collectors receive on-the-job training to learn about their employer’s policies, procedures and the software used. Some companies prefer to hire candidates with some experience working in a call centre or any other sales profession, which typically requires interpersonal and communication skills and persistence. Experience in the application of relevant software programs may strengthen your resume. Experience in training others can also be handy since Debt Collectors may be required to train team members. 

Other ways of acquiring experience are to work as apprentices under professional Debt Collectors. You may also work as a loan officer for a creditor to see firsthand how the process of granting loans works and speak directly with borrowers, with whom you may later need to interact in the role of Debt Collector.

Read about the profession and interview or job shadow experts working in debt collection to prove your commitment to course providers and prospective employers. 

While there are no mandatory educational requirements to become a Debt Collector, a high school diploma is typically the minimum qualification that most employers seek. 

Some employers prefer candidates with at least some college courses to their credit.

However, a degree or diploma in business, management, administration, or finance will give you an advantage if you wish to head to managerial roles. Credit management may also be a component of some relevant degree courses at university and covers a wide range of related topics, including telephone collections, debt recovery and dealing with difficult debtors.

Aspiring Debt Collectors may opt for high school courses in accounting, computers, business mathematics, psychology, speech, communication, English and foreign languages. 

While not mandatory, certification demonstrates a Debt Collector’s competence in a skill set, typically through work experience, training, and passing an examination. When acquired from an objective and reputed organisation, it can help you stand out in a competitive job market, carry a significant salary premium of up to 18 per cent, increase your chances of advancement, and allow you to become an independent consultant. Successful certification programs protect public welfare by incorporating a Code of Ethics.

You could earn advanced professional certification as a management or business accountant or medical office manager, demonstrating your accounting and financial management abilities to boost business performance. Keep in mind that you must periodically renew your certification.

Some employers may require Debt Collectors to be licensed before starting work. Determine with local or national debt collecting organisations and agencies to find whether you will need licensure, as licensing requirements vary nationwide and worldwide. Typically, individual government entities conduct the licensing process, which requires the passage of an examination in addition to the fulfilment of eligibility requirements, such as a minimum level of education, work experience, training, or the completion of an internship, residency, or apprenticeship.

Debt Collectors typically need to be independently mobile and possess a driving licence.

Performance, experience, and the acquisition of professional qualifications drive career progression. Employees with consistently high levels of performance may be eligible for promotion every two to three years, although, generally speaking, advancement is limited in the field.

Career advancement in the field of debt collection is relatively limited. You might typically enter the industry in positions such as Collections Specialist and then progress to titles such as Accounts Receivable Specialist and Accountant & Office Manager.

Experienced Debt Collectors may advance to supervisory or managerial positions. They may lead a small team or become Directors at a collection agency.

Debt Collectors may also move into other areas of finance after completing the requirements. Some allied roles include Bank Loan Officer, Salesperson, Debt Counsellor, and Bailiff.

Having built a solid reputation and established an extensive network, some Debt Collectors may become self-employed or launch their own agencies.

Candidates with clear communication skills, pleasant voices and prior experience at a call centre have the best job prospects.

Continuing professional development (CPD) will help an active Debt Collector build personal skills and proficiency through work-based learning, a professional activity, 

formal education, or self-directed learning. It allows you to continually upskill, regardless of your age, job, or level of knowledge.

Newly hired Debt Collectors typically undergo a few months of on-the-job training under the supervision of experienced workers and attend in-house or external courses. They learn collection procedures, budgeting, telephone and in-person interview techniques, negotiation, relevant computer software, debt recovery laws, and ethics.

Consider upskilling your academic qualifications by completing your associate, bachelor or master’s degree in business, finance, accounting, law or other allied fields. Courses in credit and finance at professional associations and colleges may increase your chances of career advancement in the debt collection industry. Various certification programs can give you a competitive advantage over your colleagues. 

Debt collection agencies establish rules and regulations regarding debt collection, and a Debt Collector must remain current with those regulations. Read industry blogs and newsletters. Attend industry events or network with other professionals online to fine-tune your professional knowledge. 

Specialisations

Debt Collectors may choose among various specialisations. 

• Consumer debt collection - collecting debts owed by individuals, either via the phone or field collection carried out at the debtor’s home or work.
• Commercial debt collection - pursuing debts of businesses, typically via letter and phone rather than personal visits. 
• International debt collection - collecting debts in the collector’s country for foreign creditors or collecting overseas debt in foreign countries for companies in their own country
• Legal debt collection -  tackling debt cases that have reached the legal recovery stage 
• Debtor tracing - tracking down debtors who may have moved or who cannot be contacted easily

Debt Collector vs Debt Buyer

Debt Collectors are third-party companies or individuals who work from them. They collect debts owed to a person or company on their behalf. They may also work directly for the organisation for which they collect payments. 

On the other hand, debt buyers are companies purchasing heavily discounted and written-off debts from original creditors, intermediaries or other debt buyers. They buy various consumer debts, such as those related to credit cards, auto loans, medical and mortgages. Then they seek to collect the actual amount of debt from delinquent parties. Debt buyers often contact customers and inform them that the payments are now due to them and work with customers to arrange payment plans or negotiate payment schedules.

Verification of Debt Collectors

Debt Collectors typically offer evidence to debtors of the party on whose behalf they are reaching out. Signs of verification include the original creditor’s name, debt amount and debt contract details. Some phrases that appear in authentic communication from Debt Collectors are "original creditor", "original account number", "collecting for", or "collecting on behalf of". Do not contact the collector if you receive collection letters or calls without appropriate verification. 

Pros and Cons of Debt Collection

Using their tools and expertise, Debt Collectors can help creditors and debtors navigate debt recovery when they cannot and free up their time and resources in the bargain. 

However, Debt Collectors impose hefty fees for their services. Their services may affect client relations by getting debtors in trouble instead of easing their debt. At times, even Debt Collectors may not yield the desired outcomes.

It is essential to weigh the pros and cons of Debt Collectors carefully before engaging their services and make sure that you do not use them too early in a situation.

Student debt in the US has surged by 58% over the last decade as the highly remunerative jobs that students expect to land upon graduation do not always materialise.

Returning delinquent debt to creditors can reduce lending interest rates, mend poor credit scores for individuals, and improve the overall economic climate for large and small businesses, thereby affecting hiring and wages for many. Though it yields valuable results, debt collection is not an easy process. However, if you have a knack for maintaining sensitivity and respect in conversations without compromising your financial acumen, you will likely succeed as a Debt Collector.

Keep a professional attitude and your emotions in check, even if your clients or the debtors you approach are difficult to tackle. Be firm, persistent and convincing but friendly, polite and understanding. Remember that they have challenges to deal with which have nothing to do with you on a personal level.