When to retain our firm to collect a debt in this economy.

Rumour has it the economy is not doing so well. Seriously. I’ve read it in papers and as you know, if you read it in the papers, it must be true. Unless of course you read something unflattering about our firm in the papers in which case it’s all lies and likely defamation.

I digress.

So, with the economy faltering, more companies are finding their customers are slowing down payments and the question becomes: when do you do something drastic about it, like hiring our firm to pursue the debt.

Many factors that pop up in evaluating this decision from your perspective are:

  1. Is this customer able to pay, but choosing not to?
  2. Is this customer not paying because they are not being paid?
  3. Is this customer likely to recover their ability to pay in the near future?
  4. Does this customer have ties to other customers and if I pursue them, will I lose other customers?

In evaluating the decision from our perspective, here are the things we look at:

  1. Does your customer have other people suing them or worse, judgements against them?
  2. Does your customer own any property that we could sell once we obtain judgment against them?
  3. Does your customer have cash available to them?
  4. Does your customer have indebtedness to a bank or others which would rank ahead of your judgment in the event of bankruptcy?

If your customer has assets of some sort, including receivables, it is likely worth pursuing, but don’t wait to pursue this, call us now.

My motto is 30 – 60 – 90 – Sue. These days, however, you might want to ditch the 90 and sue after 60 to ensure there is something to recover.

The implementation of the motto goes like this: after thirty days (or whatever your agreed terms are) send a gentle reminder notice. Follow this up with a phone call seven days later to check in with when payment can be expected. If there is no payment after sixty days send a more firm notice advising the fact that this will be turned over to your lawyers if it is not paid right away. If you don’t have the money by 90 days, call our firm and we’ll take it from there.