Discreet, Deliberate Steps for Collecting Overdue Debts

Consider your debt collection options with caution, especially if business partnerships are at stake. Debt collection agencies and legal action are your last recourse; severe options are only feasible once you’ve exhausted milder alternatives.
Overdue debts are a pain to collect, but you still have to go through the motions before you consider legal action. You have to send a debt collection letter and remind your debtor of the due payment. You always have to give people the benefit of the doubt, since it’s possible that the debt has simply been overlooked or slipped underneath a pile of paperwork and tasks. Collecting on a debt is difficult if business partnerships are involved, though; it’s easier to lend money on clients because you can hound them for payments without worrying about the consequences. Debts are unavoidable in business, especially if yours depend on suppliers, contractors, and distributors who all depend on the completion of transactions for the cash flow. The least that you can do is to ensure the collection process is diplomatic and discreet.

You don’t have to fret over overdue debts, even if you’ve held onto the short end of the bargaining stick. If a retailer doesn’t meet the regular payments due to unforeseen reasons, then you should extend the due date over a reasonable grace period. Make sure all transactions are accompanied by vouchers signed by all parties involved. The monetary amount covered by the service and the due date of payment must be indicated as well. It’s important to keep everything in black in white, even for trifle transactions and purchases. If you’ve set a thirty-day limit for the payment, then you should send an advance notice fifteen days before the due date. Follow-ups keep the debt current and urgent.

Come up with multiple drafts of your debt collection letters. You can also consult an attorney if you believe the forfeiture of the transaction comes with legal implications. Your collection letter should be straightforward and firm; there’s no room for pleasantries when your debtor is well overdue on payments. Your follow-up letters depend on your discretion. If you think you can endure three months of correspondence, then the least you can do is phrase the notices with increasing severity. It’s important that your debtor is informed about the gravity of the situation and that you’re considering legal action if the account isn’t settled on a final due date.

Complement the collection letters by contacting the debtor on a regular basis. You should always demand to speak with the debtor to ensure the problem is directly and exactly relayed to the people concerned. Maintaining a severe composure is a challenge during phone calls, as some will try to sidetrack you with excuses and cordial talk. Remember that your goal is to collect a debt but keep the business relationship intact. Your debtor should reaffirm the commitment at the end of the conversation, and your intent to take legal action must be understood. If the payment still doesn’t come in at the scheduled date, then you’ll have to hire debt collectors for the task. They’ll use more severe methods as a precursor to legal action. Debt collection services come with fees, usually in the form of commissions (on the collected amount) or upfront flat rates. These are still affordable compared to filing legal claims, though. You can check this website if you’re considering collection options. Agencies are your next-best alternatives if you think severe treatments will hasten the collection process.

By: Dave Laybare Carter

If you’re looking for efficient ways of settling overdue accounts owed to your business, then you should click here and consider professional collection services. Hire debt collectors and ensure your debtors hold up to their end of the bargain.

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Article Tags: debt collection letter , debt collection letters , debt recovery letter , debt collection letter template

Submitted On Aug 10, 2012. Viewed 694 times.

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