We know that unfortunately this is a very common situation, which generates great concern and multiple headaches, so from AYCE Laborytax we will tell you how to claim debts from delinquent customers who do not pay the right way.
Steps to claim debts from your company’s customers
One of your company’s biggest fears is delinquency,which can jeopardize profitability and viability if it doesn’t resolve quickly and lengthens over time.
The problem is that there is a great disrecognise about how to claim debts from delinquentclients, as this is a situation that we all want to avoid, which makes when we suffer some problem of delinquency, we do not know how to act.
But the reality is that delinquency affects 90% of Spanish companies in one way or another, generating revenue losses of about 17%.
So, whether to prevent or solve your problem, here’s how to claim debts in your business from customers who don’t pay step by step.
The first and most important thing is to be consistent and not let the debtpass, insisting that you be paid over and over again. Don’t be embarrassed, it’s your money and it belongs to you.
Consistency and insistence is fundamental, as letting debt pass plays in favor of the delinquent. Keep in mind that if you don’t pay probably it’s because you can’t, not because you don’t want to, so if you don’t collect the debt quickly, you run the risk of the company declaring itself insolvent ordisappearing, which would further complicate the collection of the debt.
Contact by phone
Once the customer has exceeded the payment deadline and has not contacted your company, contact them by phone to remind them that they have an outstanding debt. Here it is important to speak with naturalness and education, because in this way you will have a better chance that the delinquent will recognize his debt, and this is the first step.
From our experience, we recommend that you do not offend the debtor or be very aggressive,as in that case you run the risk that it will not recognize the debt, which would complicate its collection.
Write a letter of amicable debt claim
If the telephone route has not worked, the next step would be to write a letterof amicable debt claim, as this will record the debt in writing.
Our advice is to write a friendly letter in a clear, correct and well-intentionedmanner, in which you present the facts, indicating that there is a delay in payment and transferring to you the desire that the default be satisfied as soon as possible.
Here it is important that you identify the type and amount of the debt so that there is no doubt. If possible, accompany the letter of documentation.
To avoid being too aggressive and for the delinquent to take it as a threat, it is best to send the debt claim letter by regular mail to the address of the debtor’s company or address and also by email. Remember, it’s a friendly claim.
Writing a burofax to claim debt
If you get to this point you still don’t collect the debt, the next thing would be to write a burofax to claim the debt. The burofax will serve as a reliable proof that the delinquent is aware and has been informed of the non-payment.
Since you have already exhausted the friendly route, now you can use an aggressive and demanding style. You have to try to impress the debtor, and a good idea might be to leave the burofax in the hands of a lawyer.
In order for the debtor to feel threatened, a time limit for the payment of the debt must be set since receipt of the burofax,indicating that if once the period has been exceeded the debt has not been paid the judicial route will begin.
Proceed to the court
If the friendly route and the burofax have not served to claim the debts, it is time to proceed to the court and initiate the monitoring judicial procedure.
The monitoring judicial procedure is a form of quick and effective resolution to claim debts,and is the method that companies are most welcome to collect defaults. A procedure created in 2000 that is included in the Civil Procedure Act.
The monitoring machine can be requested by any natural or legal person, being indispensable to present evidence proving the existence of debt,so it is essential that you have all the debt perfectly documented.
Likely, the debt may not exceed EUR 250,000. For this step it is not necessary to hire a lawyer, although it is recommended.
When the judge admits the petition, the debtor will be required to object or pay the debt:
- If you object, you will proceed to a verbal or ordinarytrial, which will significantly slow the collection of the debt. If the debt does not exceed 6,000 euros it will be verbal judgment, and if it is higher instead it will be an ordinary trial.
- If it does not object, but does not pay, the amount due will be recognized, and an executive claim will need to be brought, in the interests of the execution and embargo of the debtor’s assets.
Here are all the steps to claim debts from delinquent customers who don’t pay. Our advice is to start by the friendly route, although this is optional, and in case of no solution, proceed to the court route.
If you have delinquent clients in your company and do not know how to claim debts, AYCE Laborytax legal advisors are at your disposal to help you, advise you, inform you on how to proceed and resolve any questions you may have. Contact us without obligation.