Debt negotiation can be difficult, especially if clients are unwilling to communicate with you to reach a deal.
If this is the case, there are several tips that can help you to get the best results from your debt collection.
These tips can prevent clients from taking too much and can improve the financial situation of your business by ensuring you are receiving as much money from the exchange as possible.
In this article our collection agency will discuss 5 tips to help you to get the best results from a debt negotiation with a debtor and how they can help you!
Debt Negotiation - Be in the Right Mindset
The first step for engaging in a debt negotiation that gives you what you want is to be in the right mindset when interacting with clients.
If you have found a particular client of yours quite difficult to manage, it is important that you are staying one step ahead of them by treating all communication as if a debt negotiation is already taking place.
This way, by the time you get to an actual, two-sided negotiation you have the upper hand as you have already gained some of the knowledge you will eventually use.
Furthermore, a negotiation, of course, requires some give and take. It is vital that you balance the two, however, and do not sacrifice or hold onto too much in the negotiation process.
For this reason, keep in mind the terms you are willing to change and the terms that you will lose too much if you do so.
Remember that, as the creditor, you will generally have the upper hand, so use it to your advantage.
Begin the Debt Negotiation with a Reminder
Before you start to negotiate with a client, send them a friendly reminder to make their payments to you.
Generally, a negotiation will be initiated by a creditor only if they are beginning to believe that their client will not abide by the current terms of the debt and that, if they continue like this, they will obtain losses.
After all, if you established the terms to suit you and your client agrees, only to stop following them at a later date, why should you be the one to change?
This is why it is important to send a reminder to your debtor before beginning a negotiation.
People have busy lives. Sometimes things such as debts, no matter how much it inconveniences their creditors, simply slip out of their minds.
In short, they may be willing to continue to follow your current terms but have forgotten to pay their debt recently.
You shouldn’t offer them a different set of terms that worsens your position until you are sure that they will not pay under the current contract.
Collect Information During the Debt Negotiation
Beginning a debt negotiation process by engaging in some proper research is a great way to ensure you get the best possible results out of debt negotiation.
Most people respect those that are or at least appear, knowledgeable and aware of the situation they are involved in.
Collecting as much relevant information about your debtor as you have access to can help to make you appear intelligent and well-prepared to get what you please.
This can only take a few minutes and is just a simple refresher on the matter and the debtor to avoid making errors or not knowing the answers to questions.
Furthermore, turning to the internet for a little assistance can also be extremely helpful.
Debtors may use social media apps or such programs that can give you hints about their financial situation and current general circumstance.
Keep Calm and Friendly During Debt Negotiation
When engaging with your debtor in debt negotiation, make sure that you maintain a calm, friendly, professional appearance, no matter how frustrating the client happens to be.
Everyone likes to be talked to with respect and treated like they are wanted company, creditors and debtors alike.
This being said, people do not always maintain this level of composure when discussing debts.
Debt is a topic that can incite a level of panic in debtors. For this reason, they may try to avoid conversations or lash out at you by yelling or just being generally rude when you try to collect your debts.
This can be very frustrating as you agreed to the conditions of the debt and should receive the payments as discussed.
Unfortunately, the best results in negotiation come when you remain calm and composed, no matter how the debtor is speaking to you.
Consider that it will be well worth your while as the goal is to gain as much money under your terms as you can, so no matter how much you would like to give your debtor a piece of your mind, it is best to refrain.
Don’t Accept the First Offer
Another way to get the best results from a debt negotiation is to not accept the first proposal of the debtor.
When in a negotiation, chances are the debtor has come into it with the maximum amount they are willing to pay.
They will, however, almost certainly not offer this amount right off the bat.
This is why you should not usually accept their first offer, no matter how great it seems (unless it is fine for you to accept).
You may very well get a much better offer if you apply a little pressure to the debtor, benefiting you significantly overall.
Consider Debt Collection
So, you have tried time and time again with attempts to contact, demand letters, and attempted negotiations to no avail.
You are still yet to receive payment from your debtor after you have put in your best efforts to get the debt recovered. Or maybe you are just not in the mood or do not have the time to pursue a debtor.
You may wish to engage the assistance of a debt collector to ensure all of your clients are paying their debts as discussed.
Debt collectors can take full responsibility for debts owed by clients, so you can focus on other elements of running your business.
Furthermore, the tools and experience a debt collector will have can get you your debts in a limited time and with higher success rates.
This can help to improve your cash flow and the general finances of your business. So, what are you waiting for? Try collection by a debt collector today!
Do you need to negotiate a business debt with a client or customer? Let us do it.
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.