On my website I have an "Ask Michelle" button and people can email me to ask me questions about debt collection or credit.
I recently received this question: "I have about 15yrs in the collection industry.
I have collected on car notes, medical accounts..
I'm currently working as a contractor inside a medical facility in North Carolina.
The company I work for is based out of South Carolina.
I just recently started moon lighting call self-pay accounts for this medical firm after hours.
The company that I'm employed in South Carolinais paying me as a independent contractor instead of my regular salary for hours I work during the day.
My question is since I'm doing 1st party collections, and I wanted to solicit business calling on self-pay accounts for medical firms in the area could I work for them as a independent contractor instead of referring to myself a collection agency, and not go through all the licensing for the state of North Carolina.
Also how can I market myself also to work as a contractor instead of representing myself as a collection agency?" I thought this was very interesting, and brought it to the attention of the members of my Credit & Collections Association because I knew there would be a lot of interest in this topic.
In my opinion this person may need to have some type of licensing because most business owners are savvy enough to know that they should check this persons credentials, licensing and/or bonding otherwise they could be held liable for anything that may go wrong or not be legal.
General consensus is that if the state in which this person is collecting requires a license, they should get one.
Even if they do not want to be considered a collection agency, they may need licensing or bonding to be a contractor of any kind.
A way to get around this would be to work as a sub-contractor for a company who already has this licensing in place and thereby use their licensing.
This may not work with the above question since they sound like they want to be an independent contractor in a debt collection capacity for medical accounts.
Their customers would not have collection licenses since they are medical facilities.
If this person wants to be an independent contractor as an accounts receivable clerk, something many collection agencies offer under the name of Accounts Receivable Outsourcing, they would still need to register with the state and should contact their states offices about any licensing or regulations.
They should also join associations and groups that can help them decide what type of licensing they need.
They should also remember that if they are licensed or become a certified collector it will add credibility to their business.
When talking to members of Credit & Collections.
com some judgement recovery professionals license themselves as collection agencies even though they are collecting on judgements and do not perform the duties that a traditional collection agency does.
We should note this person works for this medical company and debt collection is part of their job, so there is no license needed.
They work in-house and are paid by the medical company.
However, once you begin working on your own for any business a permit or license may be required.
You would now be soliciting accounts to collect on as an independent contractor for other medical facilities that do not employ you.
This might make you an Accounts Receivable Outsourcing firm or a collection agency, depending on your contract, duties and services.
Something to remember is that if you are collecting as an independent contractor for a business other than your own, you are considered a 3rd party collector and would need to research and meet the requirements mandated by the state you are working in.
The reality is, why open yourself up to a potential lawsuit?Check out the Fair Debt Collectioin Practices Act guidelines section 807.
This covers False of misleading representations:A debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of any debt.
Without limiting the general application of the foregoing, the following conduct is a violation of this section: (11) The failure to disclose in the initial written communication with the consumer and, in addition, if the initial communication with the consumer is oral, in that initial oral communication, that the debt collector is attempting to collect a debt and that any information obtained will be used for that purpose, and the failure to disclose in subsequent communications that the communication is from a debt collector, except that this paragraph shall not apply to a formal pleading made in connection with a legal action.
(12) The false representation or implication that accounts have been turned over to innocent purchasers for value.
(14) The use of any business, company, or organization name other than the true name of the debt collector's business, company or organization.
It is my understanding of debt collection and the laws that if you are calling anyone on the phone to try and get them to pay a bill and the company you work for is not paying you to do this, you must license yourself as a bill collector if applicable.
To try to look for a way to get around being called a Collection Agency when you are trying to collect money, and solicit past due accounts to collect on can only turn out badly.
I recently received this question: "I have about 15yrs in the collection industry.
I have collected on car notes, medical accounts..
I'm currently working as a contractor inside a medical facility in North Carolina.
The company I work for is based out of South Carolina.
I just recently started moon lighting call self-pay accounts for this medical firm after hours.
The company that I'm employed in South Carolinais paying me as a independent contractor instead of my regular salary for hours I work during the day.
My question is since I'm doing 1st party collections, and I wanted to solicit business calling on self-pay accounts for medical firms in the area could I work for them as a independent contractor instead of referring to myself a collection agency, and not go through all the licensing for the state of North Carolina.
Also how can I market myself also to work as a contractor instead of representing myself as a collection agency?" I thought this was very interesting, and brought it to the attention of the members of my Credit & Collections Association because I knew there would be a lot of interest in this topic.
In my opinion this person may need to have some type of licensing because most business owners are savvy enough to know that they should check this persons credentials, licensing and/or bonding otherwise they could be held liable for anything that may go wrong or not be legal.
General consensus is that if the state in which this person is collecting requires a license, they should get one.
Even if they do not want to be considered a collection agency, they may need licensing or bonding to be a contractor of any kind.
A way to get around this would be to work as a sub-contractor for a company who already has this licensing in place and thereby use their licensing.
This may not work with the above question since they sound like they want to be an independent contractor in a debt collection capacity for medical accounts.
Their customers would not have collection licenses since they are medical facilities.
If this person wants to be an independent contractor as an accounts receivable clerk, something many collection agencies offer under the name of Accounts Receivable Outsourcing, they would still need to register with the state and should contact their states offices about any licensing or regulations.
They should also join associations and groups that can help them decide what type of licensing they need.
They should also remember that if they are licensed or become a certified collector it will add credibility to their business.
When talking to members of Credit & Collections.
com some judgement recovery professionals license themselves as collection agencies even though they are collecting on judgements and do not perform the duties that a traditional collection agency does.
We should note this person works for this medical company and debt collection is part of their job, so there is no license needed.
They work in-house and are paid by the medical company.
However, once you begin working on your own for any business a permit or license may be required.
You would now be soliciting accounts to collect on as an independent contractor for other medical facilities that do not employ you.
This might make you an Accounts Receivable Outsourcing firm or a collection agency, depending on your contract, duties and services.
Something to remember is that if you are collecting as an independent contractor for a business other than your own, you are considered a 3rd party collector and would need to research and meet the requirements mandated by the state you are working in.
The reality is, why open yourself up to a potential lawsuit?Check out the Fair Debt Collectioin Practices Act guidelines section 807.
This covers False of misleading representations:A debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of any debt.
Without limiting the general application of the foregoing, the following conduct is a violation of this section: (11) The failure to disclose in the initial written communication with the consumer and, in addition, if the initial communication with the consumer is oral, in that initial oral communication, that the debt collector is attempting to collect a debt and that any information obtained will be used for that purpose, and the failure to disclose in subsequent communications that the communication is from a debt collector, except that this paragraph shall not apply to a formal pleading made in connection with a legal action.
(12) The false representation or implication that accounts have been turned over to innocent purchasers for value.
(14) The use of any business, company, or organization name other than the true name of the debt collector's business, company or organization.
It is my understanding of debt collection and the laws that if you are calling anyone on the phone to try and get them to pay a bill and the company you work for is not paying you to do this, you must license yourself as a bill collector if applicable.
To try to look for a way to get around being called a Collection Agency when you are trying to collect money, and solicit past due accounts to collect on can only turn out badly.
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