Revenue Reclamation – An Innovative, Pre-legal Approach to Capture Lost Revenue

Asset-based lenders know; occasional charge-offs are an unavoidable fact of life and “one of the costs of doing business.” After weeks of fruitless collection activities and attempts to locate and assess any collateralized assets, most lenders feel as though there are very few options available to them to try to reclaim any of the revenue lost. 

Some will turn to distressed debt buyers, settling for pennies on each dollar charged off. Others will engage their legal teams or counsel with the hope that their investment in legal expenses is exceeded by any cash the effort may yield. But for more and more lenders, there is a new and better course of action. One that reclaims written-off revenue and can make a substantial difference in overall portfolio performance. 

By identifying the whereabouts and condition of marketable collateral assets possessed by the customer in default, these lenders are taking steps to regain possession of the assets for resale. In some instances, financial losses attributable to charge-offs on asset-based loans can be reduced considerably. In one recent case, by nearly $300,000. This was “found money” that the lender was prepared to charge off entirely. 

In this case, a transportation company had borrowed for a number of new tractor trailers. But not long after the loan was made and the equipment was delivered, the company failed. The company filed for bankruptcy, but the tractor-trailer collateral held by the company proved to be out of reach because it had been subleased to other entities as a way for the company to raise needed cash. Desperate to recover some of the lost revenue, the lender partnered with ACS, hoping our time-tested process would help.

Knowing we had to act fast, ACS applied our deep skip tracing process and nationwide network of field agents to locate and assess the assets. Within 10 days, we had located three of the tractor trailers and had them in our possession even though they were in the hands of third parties. The lender then remarketed the equipment (which we also facilitated), reclaiming hundreds of thousands of dollars it had charged off.  

Not surprisingly, debt buyers that acquire charged-off loan portfolios from asset-based lenders also partner with ACS. Whether a lender or a debt buyer, both agree that success recovering assets on charged-off loans is best achieved by having the right industry partner. One with experience, breadth of coverage, and a commitment to compliance. Companies like ACS

Recovering assets from customers whose balances have been or are about to be charged off calls for an entirely different level of recovery services. Measures may include deep skip tracing and the engagement of additional resources, including ACS’s nationwide network of highly vetted agents.  In the case of the tractor trailers, our specialists and agents succeeded in tracking down the equipment and getting it back in the hands of the lender. 

This is just one example of ACS’s unique ability to capture “found money” on charged-off asset-based loans. Over our 25-year history, our skilled recovery specialists have developed the techniques and relationships our lender partners rely on to solve their most challenging problems and improve overall portfolio performance.