Collection lawyers and collection agencies are not interchangeable, and they each have advantages over the other. This article will focus on collection lawyers and the advantages they offer over agencies.
A Collection Lawyer Can Sue For Nonpayment
The biggest difference is the ability to sue. A collection agency can demand payment, but if its calls and letters don’t work, it needs to forward the account to an attorney. A lawyer, on the other hand, can sue, obtain a judgment and seize the customer’s assets. Going to a lawyer directly therefore saves time and streamlines the process.
A Collection Lawyer Can Enforce A Settlement
A collection agency can help you work out a settlement, but if the customer doesn’t pay, all you can do is hire a lawyer and start a lawsuit from the beginning. However, in most situations an experienced collection lawyer will file a lawsuit together with settlement papers that entitle you to judgment if the customer breaches.
A Collection Lawyer May Cost LessÂ
In some cases, a collection lawyer may charge less than an agency.  First, if you’re likely to sue the customer in the end, hiring your own lawyer cuts out the middleman.  Second, in New Jersey, a lawyer who offers contingency billing must also offer hourly billing. For a large claim or low-hanging fruit, this may cost less than a percentage of the recovery.
While collection agencies are helpful in some non-litigation situations, you’ll need a lawyer if you have to sue a customer, and you may pay less in the process.Â
For more information on collection lawyers and collection agencies, or if you’d like to discuss a specific collection issue, call me at 856-667-1669 or contact me here.
This material is for informational purposes only and should not be construed as legal advice. No person should rely on this information without seeking the advice of an attorney.