4 Important Steps in the Debt Recovery Process
Debt recovery isn’t an easy task to approach for any business owner. Chasing overdue invoices from customers or other businesses is stressful and can be quite disheartening if you’ve previously had a good relationship with these parties in the past. Fortunately, debt recovery lawyers in Melbourne can assist you with the arduous task of debt recovery and give you the tools you need to bridge communication between you and your debtors and ultimately come to a favourable resolution for you and your business. This article will detail four important steps in the debt recovery process that a debt recovery lawyer can help you with.
Reviewing Contracts/Invoice dates
The first step debt recovery lawyers in Melbourne usually take in the debt recovery process is to check over contract terms between your business and the debtor to see when the original payments were due. This helps the lawyer gain an accurate picture of the situation by knowing how much is owed, the approximate time and cost of recovering the debt, and whether or not the person or business you’re attempting to recover from actually has the financial capacity to pay the debt.
Making Contact with the Debtor
If your attempts at making contact with the person or business who owes you money have proven futile, debt recovery lawyers in Melbourne will take the reins on establishing communication with them. Attempting to make contact with the debtor is a smart move, as it can prevent the matter from proceeding to litigation, which can often be costly in both time and money.
Debt recovery lawyers will attempt to make contact with the debtor via various methods, such as issuing the debtor with a letter of demand outlining exactly how much is owed and the best way for them to make payment. They may also attempt to make contact via a phone call and attempt to add a sense of urgency to the debtor in order to encourage a faster response.
Using a lawyer or law firm rather than a debt collection agency is generally recommended, as debt recovery lawyers in Melbourne employ a less aggressive communication style that debtors often respond to more favourably.
Issuing a Formal Complaint
Unfortunately, even the best attempts at establishing communication with a debtor can fall flat, and in these instances, the next step is usually for debt recovery lawyers in Melbourne to issue the debtor with a letter of formal complaint. The issuing of a complaint will officially commence legal proceedings. While this may seem like a stressful way to proceed, sometimes there aren’t any other options. However, with the help of a lawyer experienced in the debt recovery process, the ensuing legal proceedings should go smoothly and be more likely to turn out in your favour.
If you’re successful in court, the judge will order the debtor to pay back the amount owed. Depending on the financial circumstances of the debtor, the terms of repayment will vary. It’s likely that the money will be paid out gradually over a pre-agreed upon term.
The debt recovery lawyer you’ve hired may be able to negotiate better terms in order to expedite payment as well as help you keep track of whether the debtor is staying on top of their payments, but at this point, you can rest assured the debt recovery process has been a success.