Knowing when the right time is to employ legal tactics in a debt collection and recovery case is crucial for business owners to understand. Escalating to a debt collection agency, attorney or lawsuit can strain client relationships, but timing it right is often the difference between a successful recovery and writing off the debt.
Here, the debt collection experts at the Monetaria Group discuss how to chase unpaid and delinquent invoices, what to do and when it should be done, and when to engage the service of a debt collection professional.
How To Escalate a Debt Collection Case to Legal Action
1-3 days after invoicing:
In the initial days post-invoicing, resist the urge to immediately escalate the case to a debt recovery team: there’s a chance the client didn’t see the invoice yet or hasn’t had time to respond to it yet. Send a polite email or make a courtesy call inquiring about the status of payment, referencing the sent invoice, and bringing it back to their attention. This approach shows that you’re following up and intend to see it through, while maintaining a polite and collaborative tone.
READ MORE: How to Improve Your B2B Debt Collection
7 days after invoicing:
After a week passes, gently increase the pressure. Contact the debtor with a more sternly worded email, emphasizing that payment is overdue. Set a deadline, typically 14 days, and speak of your willingness to work with them to achieve a mutually beneficial outcome, but you need their cooperation to do that. Be upfront and ask if they are having financial troubles or have any idea when they intend to pay.
READ MORE: How Much Do Collection Agencies Charge?
21 days after invoicing:
Initiate direct contact with multiple senior executives and leaders in the business. A phone call compels responses more than email, and adds a personal touch as well. Be polite but firm, stressing that it’s the final opportunity for the client to arrange payment before further escalation.
More than 30 days after invoicing:
Beyond 30 days marks a critical point for unpaid debt. If all previous attempts at communication or resolution have been ignored, it’s fair to assume that they have no intention to pay up in the near future, and it’s to enlist the services of a reliable debt collections agency. Hire a recovery firm or debt collections lawyer that is most capable of filling your needs and has experience in your industry. Choose an agency that adheres to legal processes, maintains transparency about costs, and keeps you informed throughout the process. These collection firms can employ legal strategies that ensure debtors respond to creditors, and work out a way to get you paid. Monetaria Group, with over a decade in debt collection and led by an experienced team of debt recovery attorneys, offers top-tier debt collection services, ensuring the swift and efficient recovery of your dues while fostering positive and productive client relations.
READ MORE: When Is It Time To Hire a Debt Collections Agency?
We’re happy you found this article informative! Go back to our blog page to find more tips, tricks and guidance on collections, to ensure your business gets paid.
If you have unpaid debts that need to be recovered, commercial debt collection may be a good option for your business. A commercial debt collection agency can help you with the process of recovering past-due accounts and provide guidance on best practices for managing accounts receivable.
Led by a team of experienced commercial debt collection attorneys, Monetaria Group has lawyers for debt collection and helped hundreds of businesses recover and collect their outstanding debts and payments. Schedule a FREE consultation with our expert team to see how we can help you recover your money today!