- What is the best way to collect a debt: do it myself, use a debt recovery agency, or use a solicitor?
- If you have the time to chase your debtor and they are expected to pay quickly then collecting a debt yourself is the preferred option. However, using a DCA is a preferable first step to recovering a bad debt. It offers a no cost no risk solution to debt recovery and can prepare the ground for recovering the debt through the courts. Instructing a solicitor should be done as the last resort after attempts to collect the debt amicably either through your own efforts or through a DCA have failed.
For more information on the options see "Options for Debt Recovery"
- What is a Letter Before Action (LBA)?
A Letter Before Action (LBA) is a letter sent to the debtor, usually at the end of an escalated debt recovery process, informing them that legal action will be taken if payment is not received.
For more about LBAs see our white paper Recovering debt through the courts
- What is a Late Payment Demand (LPD)?
A Late Payment Demand letter is usually the first step of an external debt recovery process. Its purpose is to make it clear the additional costs and consequences if they do not pay up.
Effectiveness depends on how seriously the debtor views the consequences and how much they believe the consequences will be followed through. Many businesses acheive this by instructing a Debt Collection Agency or legal firm to send these letters.
To instruct ACS to sent a letter see the ACS LPD letter service
- How does the ACS Late Payment Demand letter service work?
- ACS provides a LPD letter service which enables businesses to send an escalated LPD letter advising that formal debt collection processing by a DCA will take place unless the debt is paid. Letters are sent on ACS letterhead thus emphasising that the stated consequences of non-payment are real and imminent.
Such letters sit well with an escalated recovery process and do not exclude the later collection of costs from the debtor or the eventual starting of legal collection if necessary.
- How long does the collection process take?
- There is no definite answer to this question as all debts have different points at which they will pay. Some may pay immediately
and others may take longer or even require
legal action. Generally after 4 to 6 weeks. If we are unable to recover the debt our free report would advise of the best next course
of action eg. legal action.
- What is your success rate?
Very good. We pride ourselves on above average collection rates in the industry. All debts are different and we have found that a
structured yet flexible approach to each account gives better results than a 'blanket, through the mill' approach.
There will always be a percentage of cases where the debt is disputed, the debtor has absconded or the debtor is insolvent.
In our experience it pays to take action as soon as possible, otherwise you may find that you were too late. If a debtor does not have enough money to pay all their bills, they will usually pay the people that employ the Debt Collectors first. Don't wait until the money runs out. Very often the reason you have not been paid is because your debtor has cash flow problems and will not admit to it. They may also be waiting to see what steps you are going to take. Once you employ our services they will realise that it is in their own interest to resolve the matter and also that you are serious about recovering your money. Recovery of overseas debt is often more difficult and therefore collection rates are not as high.
- Is using a collection agency expensive?
- No. If it is stated in your company's terms that 'recovery costs will be applied if the invoice remains outstanding...' we can
pass our costs onto the debtor. This means the
debtor pays our fees. Alternatively if you are owed money from another company we can add interest and a late payment fee to the
amount outstanding as set out in The Late Payment
of Commercial Debts (Interest) Act 1998.
- How can I improve my debtor days outstanding?
- We all know that businesses survive on cash flow. Therefore it is important to keep on top of your sales ledger. The most important thing when dealing with late paying customers is to maintain credibility by following through with your threats. So if you send a letter advising that 'if your invoice is not paid within 7 days the account will be passed to a debt recovery agency' it is important that you do this once the 7 days have expired and don't recontact the customer or send another letter. This way you maintain credibility and the customer believes that you will enforce your credit terms.
- Can you provide legal advice?
- ACS are happy to discuss any debt related questions you may have and can advise you if we believe legal action is necessary and the possible outcomes etc. We also have our own
company Solicitors that assist us with any in depth legal advice.
- Can I afford to outsource my invoicing and collection?
- Cash flow is fundamental to the success of any business. Whether you are a small, medium or large organisation keeping your debtor
days to a minimum costs your company time and money.
Outsourcing has become common practice as a way for companies to utilise an
expert and flexible work force for a fraction of the usual cost of employment.
ACS do not charge any upfront fees and work on a 'no collection no fee'
basis. We charge a small percentage only of amounts recovered.
In many cases we are able further reduce the cost to you by recovering our fees from your debtor.
To get a no obligation quote call 01707 252900 or click here .
- My client has absconded, how can I track them down?
- In many cases tracing an absconded party requires specialist skills and resources.
ACS's tracing department not only have these skills and resources but
the experience and persistence to locate even the most professional
Please click the following link for more details about our tracing services.
- Is taking legal action expensive?
- Not necessarily at first. However, you have to know exactly who to claim against and, if
you are successful, the best method of enforcement to actually get your money. Getting
these points wrong or if the case is defended the process can take a long time and become
ACS are able to recover most debts without issuing legal action. If it is required, all the necessary information will have been established during the collection process.
Please click the following link for more information about our legal services.
- Why do some customers take so long to pay?
- The answer to this question is basically 'cash flow'. Many companies work on a
'he who shouts loudest gets paid first' policy. With the added 'volume' of being a debt recovery agency our
skilled collectors can ensure your invoices move to the top of the pile.
- Can I recover my collection cost from the debtor?
- Yes, if it is stated in your Terms & Conditions that "recovery costs will be
applied for unpaid invoices", ACS will include these charges when recovering your debt.
If it is not specifically stated in your Terms & Conditions you may still be able to
recover some costs and interest under The Late Payment of Commercial Debts (Interest)
- What if the debtor company is in receivership/liquidation?
- If the company is in liquidation/receivership the chance of recovering the full balance
outstanding is greatly reduced. However, ACS will deal directly with the
Official Receivers/Liquidators in order to obtain the best possible outcome.
For advice call 01707 252900 or click the link below to get an immediate quote.