A debt shows the right that a person has with a creditor. When it is not paid, debt collection is used. This service is used when it is no longer possible to make amicable claims with a debtor. The debtor may not be able to pay back the debt, or he may simply be a bad payer.
What is debt collection?
Debt collection is an operation that consists in obtaining the repayment of a debt. It is an activity that is regulated and recognized by the law. If you are faced with a bad payer, the creditor has at his disposal several tools and legal arsenals. Tax claims are related to taxes. They are called civil claims when private individuals are concerned. Commercial debts are related to a company. The creditor is the legal or physical person who has lent a good or money to a debtor. Very often, debt collection is applied for a payment of money. Legally, every creditor is obliged to pay his outstanding debt before the due date. If the customer does not pay after exchanges and several reminders, a collection process is initiated. A debt collection company specializes in guaranteeing the repayment of money owed by customers. Debt collection comes in many forms. For more information about the debt collection agency, please click here.
What are the different forms of debt collection?
There are two forms of debt collection. First, there is the amicable collection. It refers to the totality of the actions that could be installed in a free way by the company itself to recover the sum of money that is due to it. At this stage, if the court intervenes, you are obliged to go through a debt collection agency. Thus, the amicable collection is presented by means of a simple letter. However, the due date and the amount of money claimed should be mentioned. If this amicable procedure is unsuccessful, you can apply to the nearest experienced court. The justice exerts several levels of pressure in order to obtain the repayment of unpaid debts. This judicial recovery combines three different procedures. The injunction to pay is a fairly quick method. It usually lasts only two months, with a very modest cost. Moreover, this procedure does not require the mandatory representation of a lawyer. The duration of a provisional injunction is between fifteen days and one month. It also does not require the assistance of a lawyer. The summons on the merits is the longest of the procedures. It is often used to deal with very complex and confusing cases.
When should a debt collection agency be used?
Most companies are concerned about late payments. Using the services of a debt collection agency is a common practice for large structures and companies. When managers or creditors find themselves in financial difficulties, they look for quick ways to deal with outstanding debts. Unable to manage their problems on their own, they seek the services of debt collection services. They resort to these means when their customers ignore the deadline for payment or when they give them a hard time. Often, creditors choose amicable approaches, yet the debtors remain insolvent. If this approach does not bring any results, they turn to a debt collection company. The faster these specialists intervene, the faster the creditors will get their debt. By entrusting them with the collection, one will have more time to take care of other more important activities.
What are the means used to collect debts?
Late payments are one of the main causes of a company's deficit. When a debt is unpaid, it is necessary to resort to debt collection. Before turning to a debt collection agency, you should first make sure of its experience and skills in the field. This will ensure that you get better results. Any service provider should be able to present impeccable techniques in order to simplify and guarantee the repayment requested by the companies. In order for debtors to settle their outstanding debts directly, every collection company should have software at their disposal. In addition, it can work in partnership with lawyers to study the solvency of customers. In this way, it will be able to play a role in the collection process, especially during the various reminders. The company also collaborates with lawyers and jurists. When necessary, they will intervene in the process.