The purchase of debt is a risky undertaking, and one that remains fraught with uncertainty, even to experienced debt portfolio buyers.
The fundamental idea behind debt purchase is to capitalise on the failure of a previous lender to recover the sums they are owed. When a lender does not receive the money they are due from various sources, they may sell off this portfolio of bad debt to a debt purchaser at a fraction of the debt value itself.
This attempt at damage control by the lender will then, in turn, allow the debt purchaser to pursue the debt, with the intention of heavily profiting from the successful collection of these sums. Even a partial collection of the debt (a more realistic outcome than collecting the full amount) can make the shrewd purchase of debt portfolios a lucrative undertaking.
Risk v Reward
Yet the risk inherent in such a venture means that professional legal assistance is a necessity. Whether done to minimise the chances of making an unwise purchase or to ensure your conduct as a debt collector remains in the realms of legality, obtaining legal guidance early is a smart move for debt purchasers to make.
At Robertsons Solicitors we hold years of experience in advising clients on debt recovery across a broad range of industries. We can advise on financing, developing a business strategy and the options available for collecting the debt in your portfolio, all with the aim of maximising your chances of success in the risky world of debt recovery.
Whether you are just starting out and want assistance on your first modest-sized portfolio, or have purchased six-figures or more of debt and wish to tackle it in an effective manner, we can guide you every step of the way.
Debt purchase is a high-risk, high-reward industry. Let us minimise the risks so you can maximise your rewards.