Albany Debt Recovery Lawyers – Their Work For You
People who are owed money often need the help of an Albany debt recovery lawyer. Being owed money can cause a lot of stress and can also negatively impact your own financial situation. It is frustrating to know that you should have more money but are unable to access it. Debt recovery lawyers offer a variety of services and have a reputation for being successful in getting people the money they are owed.
It is important to understand why you have debtors. They don’t pay for two reasons: they cannot or they will not. Identifying which category your debtor falls into is crucial. This will allow your support services or Albany debt recovery lawyer to take the necessary action.
Some Reasons Why People Are Not Paying You
Customers may sometimes be unable to pay their debts due to circumstances beyond their control. One reason is that they may not have enough cashflow to cover their debts. Cash flow is often the biggest cause of slow payment. Your customer may not have been paid by their customer.
Generally, the two parties want to keep a good relationship. Occasional late payments can be accepted as part of the cost of doing business, and especially in tougher economic times, a bit of slack for a good, regular customer can go a long way to maintaining those relationships.
Another consideration is the potential cost of taking legal action to recover your debt. For smaller amounts, the cost might outweigh the benefits. This is a value judgement on your part.
On other occasions, your customer simply will not pay their bills. Your action depends on the size of the outstanding debt.
For debts less than $30,000, claims can be made through the Disputes Tribunal. This is a relatively straightforward process and costs much less than hiring a lawyer. However, it should be noted that the Tribunal does not have any power to enforce the payment even if they award in your favour.
For larger debts, you are best advised to consult an Albany debt recovery lawyer.
Their first step will be to send a letter to the debtor requesting payment by a specific date. The customer or their lawyer may ask for a payment plan whereby they pay an agreed portion of the debt. Often this is the wisest course of action since it saves further expensive legal work. It also gets some cash coming into your company.
However, sometimes even that is not an option. This will necessitate more legal work and court action. If the amount owing is less than $200,000, the case will be heard before the District Court. The High Court is the place for bigger debts.
Avoiding Debtors In The Future
To mitigate the issue of unpaid debts, it is advisable to establish a strong and efficient debt collection process. A recommended first step is to have a clearly defined and mutually agreed upon Terms of Trade agreement that customers sign prior to engaging in any business transactions.
This Terms of Trade should indicate the required payment, and its corresponding due date. It should also include:
The supplier will hold security on any products supplied until full payment is received.
That the debtor is liable for any recovery costs associated with the unpaid debt.
Interest will be paid on any unpaid bills.
If the invoice is particularly large, the supplier might want to put in place a signed Personal Guarantee from one or more of the directors.
Albany Debt Recovery Lawyer – Their Help
It is recommended to have worked with a lawyer early on in your trading history. They can draft your Terms of Trade and contracts before you begin trading. This can obviate any of the potential issues we discussed above.
However, if you have not done so, a debt collection lawyer in Auckland can provide you with valuable advice regarding your options.
They will send a letter or email to your customer requesting payment by a precise date. If this approach is unsuccessful, they have the option to prepare and submit documents to the appropriate court.
After the court decision, your lawyers can follow-up with the customer to ensure payment of the judgment against them.
If you had a Personal Guarantee from one of the directors. Then the lawyer can enforce the payment and settlement via the PG.
For companies on the North Shore looking for an Albany commercial debt recovery lawyer, McVeagh Fleming has a lot of experience in this area.