Collection Agencies

By Sylvia Rosen

We regularly survey BuyerZone users to ask how their purchases went. We've used their responses to provide a sampling of actual collection agency rates paid.

• Contingency pricing
• Fixed prices

There are two distinct types of collection agency costs. The most typical is a contingency fee: the agency gets a set percentage of any monies they collect. However, some agencies charge a flat fee per account, regardless of how much is owed or recovered.

If you need help recovering one or two particular debts, you'll generally wind up paying a contingency fee. The set rate contracts are better suited for companies that have at least a handful of delinquent accounts every month.

Other factors that influence collection agency fees are the age of the debt and the amount owed. Older debt - more than a year - is more difficult for agencies to collect, so they often charge higher collection agency rates for older accounts. Also, to make it worth their while, they may increase the percentage on smaller debts.

Contingency pricing

• "20% fee of every account collected on. We were comparing rates from a few different companies, but our decision was made due to the persistent and friendly nature of working with them. We wanted a company that collected on accounts in the same manner."

  - Microprocessor manufacturer, Milpitas, California

• "We were able to negotiate a rate of 23% per account collected on. The best part about the service is that we have the ability to log onto their website and track which accounts are collected on."

  - Outpatient Physical Therapy, Beaverton, Oregon

• "25% of recovered assets is the normal price; vendor offered 20% as I am a first time customer going through BuyerZone."

  - Business consultant, White Plains, New York

• "25% of total amount to be collected, only if collected."

  - Telecom contractor, Hugo, Minnesota

• "22% of what is collected."

  - Vending service, Lakewood, Colorado

• "The price depends on if the collection takes place. If they can collect the money, they will receive 33% because the debt is so old."

  - Construction firm, Lakewood, Colorado

• "18% of monies collected."

  - Magazine publisher, Atlanta, Georgia

• "45% of whatever they collect. If nothing is collected, I pay nothing."

  - Retailer, Ronkonkoma, New York

• "25% for items over $250 and 30% for items less than $250."

  - Insurance agency, Washington, D.C.

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Fixed prices

• "$10/month for 1 year. 4 collections processes per year included in the price."

  - Real estate, Denver, Colorado

• "Our company can file 4 collection requests per calendar year for the fee of $9.99 a month and nothing else."

  - Tourism business, West Lebanon, New Hampshire

• "$9.99/month for up to 4 delinquent accounts. I can track the status of each account online. All money collected from the debtor is paid in full, no additional fees are taken out of it."

  - Entertainment services, Carpentersville, Illinois

• "$120 for 4 accounts per year."

  - Construction contractor, Elkhart, Indiana

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Want more information on choosing a Collection Agency? Read our Collection Agencies Buyer's Guide.

Information was provided by BuyerZone users. Quotes have been edited for clarity only.