A challenge facing most businesses is ensuring that their client invoices are paid on time. Prudent payment is important for preventing a company’s cashflow from being negatively impacted.
Despite internal debt collection efforts, some clients may still refuse to pay their overdue invoices. When this happens, continuing to invest resources into internal debt collection may detract from the day-to-day running of your business.
Hence, how can a business owner deal with a growing list of overdue invoices?
In some instances, engaging a debt collection agency may be a valuable next step. These agencies are an effective tool, but they are often limited to making telephone calls and issuing demand letters. Although such methods work on most customers, they are not always effective on the more difficult clients.
Engaging lawyers who specialise in debt recover may be your best solution in cases where other debt collection avenues have failed.
Here are some of the key benefits of hiring debt recovery lawyers:
Firstly, difficult clients often ignore demand letters received from a business or debt collection agency. Sending correspondence, such as a demand letter, through a lawyer is typically taken more seriously and may be more effective at inducing payment.
Nevertheless, should a client be non-responsive to a legal demand letter, lawyers are in a position to provide advice on the next best steps and the options available for pursuing recovery.
Secondly, lawyers specialising in debt recovery necessarily have an in-depth knowledge of the relevant laws and procedures. Such knowledge enables them to properly identify issues, evaluate commerciality, and subsequently advise on the available or most appropriate options for debt recovery.
Lawyers can guide a business through the convoluted legal processes and represent a business at court should debt recovery proceedings be commenced.
Thirdly, lawyers can review and update the contracts or credit applications of a business. This may promote more streamlined debt recovery in the future and ensure greater protection to a business by minimising its exposure to incurring “bad debt”.
Such protections may include personal guarantees, real property charging clauses, and debt recovery costs liability.
If you find yourself having issues with your clients and their overdue invoices, please do not hesitate to contact Paladin Legal.
Our dedicated team of lawyers will work with you every step of the way. We will use all reasonable and available means in attempting to recover monies owed to you in a time-efficient and cost-effective manner.
Please call 1300 363 752 or send an email to [email protected].