Sep 21, 2021 MicroBilt News
The median net worth of the average American household is $97,300. Granted, many individuals are worth hundreds of times that amount, while others barely scrape by on a fraction of that figure.
Why are we discussing a person's net worth? It all comes down to their assets and debts — two items that are always intertwined.
If you're trying to recover debt from someone, your first step is an accurate asset assessment. You need to know exactly what they own, how much money they have coming in, as well as any other outstanding debts. Only then can you move forward with the debt recovery process.
What are the secrets to effective debt collection? Keep reading to learn about the best debt recovery tools on the market today.
What Is Asset Assessment?
Before you can take legal action against a debtor, you need a complete picture of their financial status. This helps you decide which accounts are worth pursuing and which ones would be a waste of time.
Asset assessment involves finding any items of value that the person could use to pay off their debt. It also includes researching other outstanding debts the person owes. Let's take a closer look at each side of the coin.
Some of the most common types of assets that collectors inquire about include:
- Real property (land and any permanent structures on it)
- Bank accounts
- Motor vehicles
- Stocks and bonds
- High-value personal property (jewelry, artwork, etc.)
- Business affiliations
- Current job and wages
- Rent or other sources of income
Each of these items helps you put together a composite of the person's financial status. Bank details and current earnings are invaluable if you pursue wage garnishment or seize funds from their account.
Before you proceed, you also need to find out about other outstanding debts and liabilities. These details will complete the picture and help you decide the best course of action to take.
Here are some common liabilities to research:
- Current and past collections attempts
- Outstanding credit card balances
- Tax liens
- Secured and unsecured loans
- Property mortgages
- Pending judgments or legal actions
With this information, you can make an informed decision about debt recovery. You may learn that it's not worth the time or money involved to file a lawsuit.
On the other hand, you may learn that the debtor has many valuable assets you can use as leverage in court. If that's the case, you can move forward with court orders to garnish wages or seize assets.
The Best Debt Recovery Tools
Now that you understand the importance of asset assessment, how do you actually go about doing it? Here are six invaluable debt recovery tools to help with your research.
Imagine if you could receive real-time updates when an individual's or company's data changes. MicroTrac makes that possible by monitoring over 600 million alternative credit data records.
If the debtor you're monitoring moves, changes jobs, files for bankruptcy, or opens a new account, you'll know about it instantly. It also traces criminal activity and other judgments or liens against the individual.
What if you're interested in one particular financial event or change? Set up a customized alert to let you know if there's been a new credit inquiry, a loan payoff, or another specific event. You can also use MicroTrac to learn when a potential customer becomes eligible for your product or service.
2. Smart Trac
Collectors often have difficulty deciding which accounts to prioritize. How can they determine which customers are the most stable (and most likely to pay off their debt)?
Enter Smart Trac, a product that provides a numerical score for each consumer. Using a sophisticated algorithm, the program analyzes 135 attributes to determine financial stability. These include credit and loan history, online transactions, and recent ACH payments.
Smart Trac even provides an "ability to pay" score that you can use to prioritize your debt recovery efforts.
3. Bank & Debtor Locator
If you're involved in late-stage collection and recovery efforts, our Bank & Debtor Locator tool will be your new best friend. It allows you to pull traditional credit bureau data in one easy-to-read report.
This tool lets you quickly identify the debtor's address and current employer, as well as all recent financial inquiries.
4. SPOT Verified Bank Locator
For a more comprehensive overview of a debtor's bank accounts, you can use our SPOT Verified Bank Locator product. It pulls data from over 1.7 billion financial transactions, making it one of the largest databases of its kind.
With this report, you can not only locate but also verify up to four ABA/account numbers per person. You can also see other names associated with the account, which can be a valuable resource in your attempt to recover the debt.
5. SPOT Property Report
With asset assessment, you need to know not only if the debtor owns any property, but also if they've recently sold any. Our SPOT Property Report provides that important information and much more.
You can search databanks from 3,100 different counties nationwide for sale amounts, tax assessments, and any mortgages or foreclosures. You'll also have access to the mailing address and property details of the physical site.
6. SPOT Place of Employment Report
Effective debt collection often involves wage garnishment. But before you can get a court order to garnish wages, you first have to know where the debtor works (and how much they're earning).
With a SPOT Place of Employment Report, you can find out those details with just a few clicks. Quickly verify up to six current and past employers, along with contact details for each. This can save a tremendous amount of time and money during the collections process.
Get One Step Closer to Recovering Debt
It's never an easy task to recover debt, especially if you're having trouble tracking down the debtor. But, as we discussed above, asset assessment is a vital part of the debt recovery process.
The good news is that there are plenty of effective debt recovery tools you can have in your arsenal. Better yet, you don't have to go to many different sources to find them.
Microbilt has everything you need to track down people (and their assets) so you can move forward with the collection process. Click here to view our full list of debt collection and recovery tools and see which ones will work best for you.