As it concerns trying to recover past due accounts from your debtors, they myriad of debt collection laws can, at times, feel like a stumbling block. Certainly, your primary goal is persuading as many delinquent customers as possible to pay their debts, and help keep your business' cash flow strong.
Communicating With Your Customers - Do you know the guidelines and rules when it comes to communicating with your late-paying customers? The Fair Debt Collection Practices Act protects and regulates the kinds of communications allowed between creditors and debtors.
For example, there are limitations placed on the times during the day, as well as weekend, when you can contact debtors. There are also limits governing where you can and cannot contact delinquent customers about their past due accounts. Make sure you understand and operate within these legal prescriptions.
When contacting a third party to try and reach the debtor, you're also restricted in only asking the third party for information about reaching the actual debtor.
Ownership Of Debt Disputes - There may be instances when a debtor will deny owning the debt, or that they owe your business any money. When this occurs, you are required to send written proof of this outstanding debt
Accurate and Truthful Information - It is imperative that you provide your debtor with accurate information. For instance, it is against the law for you to threaten or insinuate that you'll have debtors arrested. You also can't falsely represent that you have legal representation, when in fact, you do not. Nor can you imply that you have some governmental entity chasing after them.
Youre only able to give real information about the debt and your collection methods must abide by the debt collection agency laws at all times. Did you know that for violating the debt collection laws, your debtors could sue you for violation and potentially collect as much as 1 percent of the collectors net worth.
It is very important that your business clearly understand the debt collection laws as related to your collection methods. Collection agency laws extend beyond simply getting customers to pay their delinquent debts.
You should also learn how changes to the Fair Debt Collection Act relates to a customer's access to credit reporting information. Should the customer wish to verify information contained in their credit report, you will need to ensure that the information you provide is always accurate. Not adhering to these laws, business owners could face fines, and in some instances, the debt owed to them might be discharged.
Sometimes debt collection can be a difficult process, but as long as you understand the debt collection laws or the collection agency laws and how they can affect which actions you need to take to recoup money owed to you then you may find its not as difficult as it sounds.
Knowing what actions you can take legally will also help you to create successful debt collection strategies, whereby you're able to communicate with your debtor properly and collect the debts owed to you.
Communicating With Your Customers - Do you know the guidelines and rules when it comes to communicating with your late-paying customers? The Fair Debt Collection Practices Act protects and regulates the kinds of communications allowed between creditors and debtors.
For example, there are limitations placed on the times during the day, as well as weekend, when you can contact debtors. There are also limits governing where you can and cannot contact delinquent customers about their past due accounts. Make sure you understand and operate within these legal prescriptions.
When contacting a third party to try and reach the debtor, you're also restricted in only asking the third party for information about reaching the actual debtor.
Ownership Of Debt Disputes - There may be instances when a debtor will deny owning the debt, or that they owe your business any money. When this occurs, you are required to send written proof of this outstanding debt
Accurate and Truthful Information - It is imperative that you provide your debtor with accurate information. For instance, it is against the law for you to threaten or insinuate that you'll have debtors arrested. You also can't falsely represent that you have legal representation, when in fact, you do not. Nor can you imply that you have some governmental entity chasing after them.
Youre only able to give real information about the debt and your collection methods must abide by the debt collection agency laws at all times. Did you know that for violating the debt collection laws, your debtors could sue you for violation and potentially collect as much as 1 percent of the collectors net worth.
It is very important that your business clearly understand the debt collection laws as related to your collection methods. Collection agency laws extend beyond simply getting customers to pay their delinquent debts.
You should also learn how changes to the Fair Debt Collection Act relates to a customer's access to credit reporting information. Should the customer wish to verify information contained in their credit report, you will need to ensure that the information you provide is always accurate. Not adhering to these laws, business owners could face fines, and in some instances, the debt owed to them might be discharged.
Sometimes debt collection can be a difficult process, but as long as you understand the debt collection laws or the collection agency laws and how they can affect which actions you need to take to recoup money owed to you then you may find its not as difficult as it sounds.
Knowing what actions you can take legally will also help you to create successful debt collection strategies, whereby you're able to communicate with your debtor properly and collect the debts owed to you.
About the Author:
David P. Montana has been a noted industry expert, business consultant and writer for over three decades on the subject of collection agencies. He provides additional valuable tools and information on debt collection laws.
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