The legal field of debt collection is as old as humanity itself. Unfortunately, many of us have experienced a situation where we lent money to someone, performed a service, completed a project, or sold an item, but did not receive the agreed financial amount in return.
Sometimes the debtor remains stubbornly silent; other times they overwhelm us with endless promises of paying soon or excuses that they truly do not have the funds right now, or they suddenly start making tendentious complaints that the service was not performed properly, and that it is actually they who suffered damages. If you need assistance, you can contact us. We will be happy to help you.
A high-quality contract prevents complicated debt collection
It is therefore essential to emphasize the importance of high-quality drafting of contracts, agreements, orders, or other arrangements that prove the creditor’s entitlement. We recommend having template contracts drafted by a lawyer. A one-time payment for a lawyer’s fee will pay off many times over. When a dispute arises with a debtor who, thanks to a well-drafted and structured contract, will be in a substantially weaker position against you, they will often reconsider their obstructions and prefer to pay immediately rather than let their debt increase further.
Legal problem solving
We strongly recommend not giving up on the matter and thinking that the time, nerves, and money spent on resolving the dispute are not worth it. By doing so, you not only support the debtor’s irresponsible behavior and deprive yourself of well-deserved money, but information about your debt forgiveness may spread further and inspire other debtors who were otherwise prepared to pay.
Out-of-court dispute resolution
The ideal option is an amicable out-of-court resolution of the situation. If the creditor and debtor can reach an agreement, it is almost always best for both parties. The creditor avoids court costs and the time-consuming nature of a dispute. The debtor then often avoids paying both court costs and legal representation fees for both themselves and the creditor. Possible installment plans, payment of default interest, and other contractual penalties can also be reasonably adjusted. It is better to leave the preparation of settlement agreements, installment plans, debt acknowledgments, and similar documents to a lawyer. This is not an overly expensive legal service, yet it ensures that the debtor’s obligation is best prepared for court in the event the debtor fails to uphold their part of the agreement.
Judicial dispute resolution
A more rigorous option is resolving the situation through litigation before a court. The creditor first notifies the debtor with a pre-litigation demand to pay their debt within 7 days of delivery, stating that if they fail to do so, a lawsuit will be filed against them. The debtor is given one last chance to voluntarily fulfill their debt; otherwise, this debt will significantly increase due to court costs, default interest, and other penalties. A pre-litigation demand is a prerequisite for the creditor to be entitled to reimbursement of court costs in the event of winning the dispute. Therefore, it is important that it contains all necessary requirements, which cooperation with a lawyer on this task will ensure. Again, this is not a very expensive matter. The advantage of engaging a lawyer is that the demand is written on the law firm’s letterhead, which often startles the debtor and forces them to pay their debt. Are you unsure how to proceed? Contact us.
