Are you a business owner not feeling too good about the chances of your debtor paying up and thinking about things debt collectors can do to help?
If so, you may be feeling very irritated and stressed and don’t really know how you can proceed with the matter. After all, if not even a debt collector can get your debtor to pay up, what can you do about the debt?
Fortunately for you, this is not the end of the road and there are still several things debt collectors can do to have the debt collected!
There are still means that your debt collector can use to collect the debt, even if the client still refuses to pay!
It is important that you are aware of the things that they can do so that you are informed and involved in the process.
In this article our Australian debt collectors will discuss some of the several things debt collectors can do to collect your debt.
Things Debt Collectors Can Do
In this article we will outline just five (5) things debt collectors can do to collect this debt from your debtors. These include the following:
- Send a Final Notice
- Follow-Up with Client
- Organise a Negotiation
- Exhaust Other Methods
- Take Legal Action
We will expand on these in more detail below.
Send a Final Notice
The first thing that a debt collector may do once they feel that the client will not pay their debt under regular circumstances is to send the client a final notice.
Sometimes, even after taking the step of hiring a debt collector, your clients may not take your pursuit of the debt seriously.
Whether it's because they genuinely believe that if they leave it long enough that you will let it go or if they would rather leave it until the last possible moment for unknown reasons, they may not be willing to pay until practically forced to do so.
This is just one of many circumstances that a final notice can be effective. A final notice can be a very effective tool when trying to collect a debt from an non-paying debtor.
This is generally a very early step after you officially hire a debt collector. After you have sent your client several friendly reminders, this will usually be the next step.
A final notice simply warns the debtor that they must pay the debt to prevent further action from taking place. A letter of demand may then be sent if the final notice is unsuccessful.
Follow-Up with Client
Another thing that a debt collection agency may do to recover a debt from an non-paying client is to follow up with them.
If both the final notice and the letter of demand are unsuccessful, the next step that a debt collector may take will be to follow up with the client.
The final notice and the letter of demand are two significant steps and, if you are still yet to receive payment, it is easy to begin to feel defeated in the matter.
This is, again, not the end and following up with the individual may be effective. Sometimes when a client receives a letter of such legal stature, they may not necessarily understand what it means or what to do.
If this is the case, they will likely either contact you about it or do nothing at all. If the latter is the case, following up can be very effective.
By contacting your client to organise immediate payment, they may finally understand the gravity of the situation and the meaning of the earlier attempts to receive payment.
Organise a Negotiation
When a client doesn’t pay their debts it can, on occasion, be due to their financial or otherwise inability to pay it as per the terms discussed.
Whether it be for pride, fear of further financial issues, or personal issues distracting them from the debt, your debtors can sometimes fail to communicate these issues with you.
One way that you may be able to get all of these issues out on the table is by organising a negotiation of the payment terms of your agreement.
Although it may be best for you to be paid as the agreement states, it is sometimes better to negotiate the terms so that you at least get paid!
Otherwise, clients may be forced to declare bankruptcy or other such insolvency agreements that mean that you receive less of your debt than you may like.
Negotiation can be a very productive situation that ensures that the agreement works for both parties and that you are paid the debt that you are owed.
Exhaust Other Methods
Another thing that a debt collector may do to recover a debt from an non-paying client is to exhaust any other methods of recovery that they can before taking legal action.
This is less of an action and more of an expectation, but it is important all the same. Legal action is generally something to be avoided when it comes to debts.
This is because it is an extremely costly and time-consuming route that is never really in your best interest if it can be avoided.
A good debt collector will ensure that any other route of debt recovery has been tried and tried again before recommending that you take legal action.
They do, of course, still have to make sure that the debt collection rules are being followed, so they can only contact your debtor so many times!
Take Legal Action
As previously stated, the last step that a debt collector will take to collect a debt from an non-paying client is recommending you take legal action.
Although it is not generally considered to be a favourable route, it can sometimes be just that if the time is right! If it is either legal action or not getting paid a debt, legal action is usually the way to go.
It is, however, still important to consider if this is the right thing for your business!
Key Takeaways to Things Debt Collectors Can Do
Collecting a debt from an non-paying debtor can be a trying task for anyone.
As you watch as your debt collector tries different routes to recover the debt in vain, it is easy to feel as if you will never receive that debt.
Fear not! There are many routes that can be used, and debt collectors are professionals in the industry, so you are in good hands!
Do make sure to research the debt collector beforehand however to ensure you are choosing the right agency.
Advance debt collection is an Australia-wide commercial debt collection agency and credit and accounts receivable management. We can recovery your debts, conduct skip tracing, and manage your accounts receivable. We collect your debts for commission only. This means no collection, no commission. We are professional debt collectors with combined 20 years of experience to help you collect your debts. We are partnered with expert litigation lawyers with years of experience in debt recovery, enforcement, and insolvency. Under the Agents Financial Administration Act 2014 Advance Debt Collection Pty Ltd hold authority number 4583821 to act as a debt collector. ADC Advance Debt Collection® is a registered trademark.