Tens of millions of people are in debt. That number tends to go upwards every year as more people pursue higher education, houses and choose to spend money that they don’t have.
While most articles you read are focused on helping people that have fallen into debt, few focus on those that are owned outstanding debts.
Do you own a business and have overdue invoices? Are you just a regular person that is owed a substantial sum by a family member or friend?
If so, below, we outline some tips on how to collect a debt that is worth looking into.
1. Ask Nicely
We get that when somebody owes you money and misses their due date, your first reaction might be to get frustrated and assume the worst possibility.
Rather than letting your imagination run wild though, the most productive thing to do is send them a reminder.
Our recommendation is to send the person that owes you money a reminder in writing.
Shoot them an email stating the nature of the debt, when it was due and attach proof that the debt is owed. Then, send the person a text message or give them a call telling them that they have a debt reminder in their inbox.
If you don’t get a response, consider hiring a company that serves notices to hand-deliver a letter outlining the debt to the person in question.
2. Request Legal Help
Are your notes not inspiring your debtee to pay up or come to the table for a discussion? You may want to hire a lawyer then.
Lawyers can write a more formal letter regarding your debt that could scare the people that owe you into a discussion.
Having a law firm send out legal notices shouldn’t be too costly so inquire around to see what the going rates are.
3. Hire a Private Investigator
Is your debtee saying that they don’t have money? Hire a private investigator to find out if they’re telling the truth.
There are many investigators that specialize in pre-litigation asset search who can give you a person’s full financial picture.
Armed with that information, you can choose whether or not they’re worth suing.
4. Go to Court
If you find that the person who owes you money has the means to pay but just won’t, going to small claims court is the next logical how to collect a debt step.
Small claims court will force the person who owes you money to pay if the judge’s decision ends up being favorable to your plight.
5. Sell to Collections
Want to avoid court? Looking to cut your losses?
See if you can find a debt collection’s agency to sell your debt to.
Many agencies will buy debt off of you at a discount and then go through their more aggressive channels to collect what is owed.
Wrapping Up How to Collect a Debt
The how to collect a debt process can be stressful for people that are owed money. If you walk through the steps that we’ve outlined above and do your best to stay patient, we have no doubt that you’ll be able to come away with at least a portion of what you’re owed.
For more financial tips, check out additional content on our website today!
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