Looking to join a debt buyer network? Here at EverChain UK, our certified buyer network allows you to access a larger selection of portfolios for sale than you’ll find anywhere else. And with our annual certification process, sellers are quickly able to identify buyers that would make a good match. So you can be assured that you’ll be able to purchase as many portfolios as you have appetite and funds for!
Another benefit of joining EverChain UK’s debt buyer network is that you’ll be able to use our advanced filtering tools, which allow you to easily identify the debt portfolios that are inline with your investment criteria. You can furthermore set up alerts which will notify you when similar portfolios become available to bid on.
If you’re thinking about joining a debt buyer network, we’ve outlined some of the key considerations below:
What is a Debt Buyer?
As the name suggests, a debt buyer is an individual or organisation that purchases debt from creditors. Generally, this would be older, defaulted debt, that the lender has attempted to collect, but was ultimately unsuccessful. This is often due to the fact that lenders are not experts in collecting bad debt but are better versed in early stage collections processes.
Debt buyers can also be referred to as debt collectors, or debt collection agencies, as after purchasing the debt, they’ll be well trained in collecting the balances from borrowers. Debt buyers often have more flexibility at this stage than the original lender, so tend to have a higher success rate.
Another key thing to note about debt buyers is that they will purchase a debt portfolio at an incredibly reduced rate – often at pennies on the pound. This means that as long as they are able to collect a fraction of the outstanding debt, they should soon be in profit.
Why Become a Debt Buyer?
There are a number of benefits to becoming a debt buyer, though you should bear in mind that it does come with some level of risk. For this reason, many debt collectors choose to join a debt buying network, so that they have access to expert advice at all times.
One of the main advantages to purchasing debt is that you can buy portfolios for such a low price, thus if borrowers are making even small repayments, you’ll undoubtedly be making a profit. For instance, if you were to buy a debt of £500 for the price of £50, once you surpass a tenth of the due loan amount, the rest will be profit.
Another benefit of becoming a debt buyer is that you’ll often have more scope in the methods you can use for debt collection. An example of this might be issuing a County Court Judgement (CCJ), and perhaps an Attachment of Earnings Order (AEO) against a borrower. Not all lenders have a policy in place to take this course of action.
Why Do Lenders Use Debt Buyer Networks?
While the advantages of becoming a debt purchaser may be obvious, you may be wondering why lenders decide to sell debt, at a fraction of the price it’s technically worth. The main reason seems to be that lenders are not always as qualified to chase bad debt, and will therefore waste valuable time and resources doing so. It can actually be more cost effective to sell on the debt, rather than spend more hours trying to collect it.
Creditors furthermore choose to sell debt because it means they’ll be able to instantly reclaim some of their funds. And if they decide to sell through a network, the lender will also be able to save time searching for an appropriate buyer.
Having debt sale in a lender’s customer journey additionally means that there will be a real consequence for non-payment. This should in turn encourage customer engagement, as well as increase the overall payback rate of the lender.
Should I Join a Debt Buyer Network?
As with becoming a debt buyer, there are a variety of advantages to joining a debt buyer network. Perhaps the most obvious benefit is that it’s easy to find great portfolios, and you should be able to apply filters, which make the process even simpler. Save time and effort scrolling through individual buyer pages by looking in just one place!
With EverChain UK, you can additionally set up handy alerts, which will notify you when the types of debt portfolio you’re interested in are added to the network. You can easily compare options and ensure that you’re purchasing a portfolio which you’re confident you’ll be able to make a profit from.
Another advantage of joining a debt buyer network is that you can speak with a team of experts. So if at any point you wish to discuss your account or your buying options, EverChain UK will be happy to help.