Personal Injury Lawyer
Every day, business owners face many different challenges. It is not easy to keep enough revenue coming in to pay the bills, let alone enough money to actually make a profit and grow the company. Things become all the more difficult when another business fails to pay its debts.
Indeed, when one of your accounts unexpectedly turns delinquent, it can be immensely nerve-wracking and can cause tremendous disruption to your business. Depending on the size of the debt and the size of the company, it is far too common for this type of situation to result in the company being forced out of business.
Here, one of our experienced business law attorney highlights three of the most common obstacles to commercial debt collection.
- Debtor Excuses
At some point in our lives, we have all been there: dealing with someone who has endless excuses. Unfortunately, some debtors will throw out every excuse in the book when your company tries to attempt collection. They may tell you that their bill was not received, or that they are about to have the cash flow to pay out their debt at the end of the month, and yet, the actual payment never seems to come. Ultimately, excuses are usually just stalling tactics that are used to thwart your company’s ability to recover the debt. You need to be ready for these excuses. The longer an account is delinquent, the less likely it is that you will be repaid in full.
- A Debtor Going Out of Business
When a company goes out of businesses, collecting from them becomes far more difficult. This is one reason why it is so important to stay on top of commercial debt collection if your company is involved in any type of business-to-business lending, even if it is only short-term lending. Should one of your debtors start to fall behind, quick action is a must. Do not accept excuses.
- A Debtor Filing for Bankruptcy Protection
If a business files for bankruptcy protection, your debt collection efforts will enter a new phase in the process. The good news is that you still have options available. At the same time, once bankruptcy is initiated, it is a near certainty that some of the filing company’s creditors will not be paid back in full. As soon as you receive any type of notification that one of your debtors has filed for bankruptcy, whether it is Chapter 7, Chapter 11 or Chapter 13, it is imperative that you take immediate action and seek professional assistance from a skilled business litigation lawyer.
Contact a Business Litigation Law Firm Today
A business litigation lawyer Melbourne, FL trusts has extensive legal experience helping many businesses just like yours recover funds owed to them. Contact a firm today to set up a case review.
Thank you to our friends and contributors at the Law Offices of Acadier, Biggie & Wood for their insight into business law and debt collection.