Collections Or No Collections...

Bluepenguin

Hi guys, been a long time.

Quick question... we have 2 deadbeat customers, both invoices are for under $500. Both were apparently satisfied with the work, but failed to pay. "Cheque is in the mail.. " "I'm travelling"... blah ... blah...

Would you bother sending these guys to collections? We have a pretty healthy revenue and I'm not sure if I should be doing this. On top of it, I have a strange paranoia that they (or their bitchy wifes) may retaliate in some way and post who knows what about us online.

The best part is, one deadbeat is an ER doctor, the other is a chairman of an airline company. You figure they'd be good for payment !

Sorry for the snappy tone.

Framer53

Stop worrying, collections it is!!

plazaman

Not to hijack your thread, but what are the requirements for submitting to collections? Were you supposed to do credit check before signing the contract? Social Security?

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Westchester Remodeling Contractor
Hartsdale Remodeling Contractor
Ardsley Remodeling Contractor

CookeCarpentry

Here's what I do, all invoices they have 30 days from invoice to pay in full or incur late charges.

After 30 days, I send a regular envelope with a letter explaining the invoice, copy of invoice and any other relavant material. On the front of the envelope in big bold red letters I pring "Attention: Past Due Notice".

Also, a job not paid in full voids all warranties (in my contract). If nothing, around day 45, send a certified, return receipt letter with the same thing. Again on day 60. Collections after that.

Framer53

Collection agencies could care less, unless they are buying the paper!

plazaman

what do you mean by that?

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Westchester Remodeling Contractor
Hartsdale Remodeling Contractor
Ardsley Remodeling Contractor

AJAX

Means they buy the contract at a fraction of what is owed and go after it themselves and hopefully collect and make a profit. Or they could collect on your behalf and when settled receive a percentage.

bwalley

A debt buyer does not buy individual invoices, they buy large multi million dollar portfolios.

Small invoices can be sent to a collection agency and they will typically keep half of what they collect but they are not going to do much other than make a few phone calls.

Framer53

I haver in the past sold som small debts to collection agencies, but it is rare!

Zinsco

Certainly the rules vary from place to place, but after 30 days I lien the property and 30 days after that I file a small claims action. Once you do this a couple of times, it becomes easy.