Our member AST Hamptons Solicitors has a Debt Recovery department to deal with straight forward debt claims for those due under an invoice. They act for number of companies and individuals who has debts that need to be collected.
Over many years of practice, they worked out some of the best ways to ensure results on debt recovery and here are some of their tips;
Avoid allowing your debts to linger over 6 months as the chance of recovering it diminishes rapidly.
Make provisions to charge interest on accounts unpaid beyond payment terms.
For a company you can use a lawyer or do it yourself. A debt of over £750.00 or £5,000 for individual can warrant a Statutory demand.
Create a set of communications letters such as;
Have you overlooked your invoice?
This invoice is now overdue for payment, please make a payment by return.
Remember to keep your client files up to date. Many uncollected debt is because of inaccurate or insufficient information about the debtor. It is sometimes helpful to extend your details up to clarify a client is trading as limited company or a sole trader.
In all its glory, debt collection can sometimes be a cause of breakdown in relationship between clients. As soon as possible, make the conversation and address potential issues you might have. Or best case scenario, aim to get payment, before all has broken down. It is safe to confirm that not every debt are paid even if you are using a lawyer.
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