Debt collection procedures

T

treemann

Location
NW Indiana
Does anyone have their invoicing and collection procedures written down?

We don't have any written policies and while researching the topic the articles that I have read have stated that procedures should be written down so that every account is treated the same.

The articles also suggest that written procedures improve cash flow and reduce late payers.
 
My contract states that payment is due in either check, cash or money order at the conclusion of the specified service, and that any invoice, which goes unpaid for 30 days or more is subject to being forwarded to an outside agency for collection, as well as for reporting to credit reporting agencies. Also that a 1.5% interest charge will accrue monthly on unpaid invoices starting at 30 days.
 
Do you forward to a collection agency at 30 days?
Or do you call at 25 days and inform the client that the account will be turned over to a collection agency.

What about storm work when insurance takes 70 to 90 days to pay?
 
[ QUOTE ]
Do you forward to a collection agency at 30 days?
Or do you call at 25 days and inform the client that the account will be turned over to a collection agency.

What about storm work when insurance takes 70 to 90 days to pay?

[/ QUOTE ]

It behooves us to call them and give them a chance, most late payments are from folks otherwise engaged, just not on top of things.

As for insurance taking forever to pay, I have a simple answer. My contract is with the customer, not the insurance company. Payment is due at time of service or, in rare cases for my convenience, on receipt of invoice.

I will turn down the work if they tell me they need to wait for the insurance company as often as not, the insurance company will pay them and not me. Of course payment to me then becomes doubtful.
 
[ QUOTE ]
Do you forward to a collection agency at 30 days?
Or do you call at 25 days and inform the client that the account will be turned over to a collection agency.

What about storm work when insurance takes 70 to 90 days to pay?

[/ QUOTE ]

So far (touch wood) they read the contract and don't sign if they feel like they'll have a problem paying. I'm with Richard on the insurance stuff. My contract is with the property owner, and their ability to subrogate a claim to insurance or get paid for it isn't my concern.

Having worked as a professional debt collector in a previous life, I will say that before you pick up the phone, or write a letter to attempt to collect a debt, consider well how much you know about the Fair Debt Collections Act. Violating the act can subject you to serious financial consequences. Unless you've been thoroughly and currently educated in the legal aspects of collecting debts, it may be safer, as well as more effective to enlist the services of a professional in that field.
 
I have done all the collections my self. I send invoice. If they are going to be a dead beat I send a letter and certified letter.....then I win in court. I havent lost yet..My advise is to have everything written down and signed. When you think someone is going down that path write down when you called and jist of the conversation. It helps you to remember. I have won cases without signed contracts in the first couple of cases but a signed contract goes a long way.


This being said I have only been to court a handful of times in 20 years but it feels good at the end of the day.
 
I now realize I know nothing about the Fair Debt Collections Act, but I once had to threaten to put a lien on the client's property. My lawyer gave the ok to tell them that though, that conversation cost me $310.
 
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