- Check credit references when extending credit. Have the customer complete a credit application with the provision that if their account is turned over to a collection agency they will be responsible for all interest, late fees, collection fees, attorney fees and court cost associated with the collection process.
- Obtain as much information as possible on all account holders including, but not limited to, social security number, date of birth, place of employment, employment phone number, cell phone number, spouse or close relative's name including their phone number, spouse's employment and spouse's social security number. Plus it is a good idea to obtain a copy of a government issued photo ID.
- Keep a photocopy of the customer's first check or any subsequent one if there is a change in banks.
- Clearly explain in detail to new account holders when payment is expected and any terms if payment is late or turned over to collections.
- When collecting past due accounts ask for a specific date on when you should receive payment.
- Attempt to clear up any disputed portion of the bill.
- If an account becomes delinquent more than 90 days, turn it over to a collection agency. Chances are likely that the debtor's financial condition will not improve, but will deteriorate.
- Always keep copies of statements, invoices and letters of the debtor's account.
- Always get a copy of a government issued photo ID, home and cell phone number, plus place of employment with every check you accept.
- Avoid check with a low check number unless you know the check writer. Low check numbers are an indication of a new account and there has not been sufficient time to establish a good banking history.
- Be careful accepting third party checks. If you accept a third party check, obtain as much information as possible on the person presenting the check including a copy of a government issued photo ID.
- Set an absolute final due date before the account is turned over to a collection agency and give the debtor full warning of this final due date.
- Make an effort to have all invoices signed by the debtor.
