As a small business or startup, dealing with clients who owe money gets exhausting fast. Any bill that is a minimum of 60 days past due becomes “delinquent,” meaning you can enlist debt collection agencies to contact the debtors and obtain the payments. If you need debt collection assistance, here’s what you need to know about the process.
FAQ About Debt Collection
What is the Fair Debt Collection Practices Act?
Debt collectors do not have the right to harass debtors, such as by calling them repeatedly on a daily basis. Collectors must adhere to the Fair Debt Collection Practices Act (FDCPA), which details how aggressive, deceitful, and abusive collection practices cause job losses, personal bankruptcies, marital discord, and privacy invasions. The act, which was amended as recently as 2010, protects consumers by requiring collection agencies to send written validation notices stating how much money is owed and to who, as well as necessary steps to take if the debt does not belong to the individual in question. Additionally, if a debtor asks a collection agent to stop calling their home or office, they are legally obligated to do so.
Can collectors call the family & friends of debtors?
If a debt collection agency does not have the debtor’s contact information, agents can call relatives and friends to obtain the phone number or address. However, they cannot legally discuss the debt or call the same associate more than once. Friends and family also have the right to ignore collection calls.
Can I ask them to conduct asset investigations?
Debt collectors can review the debtor’s brokerage and bank accounts in regards to their repaying abilities; however, collectors are not allowed to seize any assets or take money from accounts. A collector must win an official judgment before the statute of limitations expires to start garnishing wages. The agent still has to contact the bank or other organization to make a formal request before wage collection can begin.
What should I do if the debtor refuses to make the payment?
Debt collection agencies can report past due bills to credit bureaus and damage credit scores if no payment arrangements are made. If you are dealing with a client or customer who will not pay past due bills, consider working with a law firm that specializes in debt collection. Professional assistance ensures collection agencies stay within FDCPA guidelines and helps create a repayment plan that satisfies all parties.
If you have a client who will not pay, contact Luke A. Weiland, Attorney at Law, in Wisconsin Rapids, WI, to successfully navigate your case. Specializing in debt collection for businesses, this lawyer also offers divorce law and estate planning services. Call (715) 422-6808 today to schedule a consultation, or visit the business law attorney online to learn more about their services.