Newbie Help / Advice

Hello all,

I am starting an agency in a few short weeks and am looking for some advice.

-What is the best type of debt to purchase for a new agency? - PDL's? credit card? 0 agency? 1 agency?

-What is a reasonable rate to pay for the debt(0 or 1 agency)?

-What is a reasonable recovery rate (15% is what i believe to be average)?

We will have 2 or 3 collectors to begin (all with limited experience).

Any help would be greatly appreciated!!

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Permalink Reply by Wendy P Marcisofsky on December 1, 2010 at 7:19pm

GOOD advice. I'm a consultant as well and do agree that a new agency may not want to venture into purchased debt unless they truly have investment $$ that they can fully risk. ...and, yes, the risks are numerous and varied.

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Permalink Reply by Chad Newark on November 30, 2010 at 3:51pm

I am in the exact same situation. I'm looking to start my own agency in the next few weeks and am finding all your input helpfull.

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Permalink Reply by john pratt on November 30, 2010 at 9:01pm

Hi William. I would suggest getting clients and collect on a contingency basis. As your company gains experience you may see what type of debt you would like to buy. Debt portfolios are selling high when we are talking fresh or one agency. As your firm gets a better idea of the collection process and their strength you may reach out to service debt buyers and maybe partner with them on a purchase or use reliable contacts you would have made during your contingency work. If you do buy debt give me a call before you do and I will answer any questions you may have.

Thanks and good luck.

John Pratt
Portfolio Management Group
www.pmg-solution.com
Columbus Ohio
614-440-6614
Author of "Debt Purchasing, An Investors Guide to Buying Debt" and a contributor to the ACA International "Buying Receivables Manual"