Wednesday, August 26, 2015

What You Need to Know about B2B Debt Collection

Debt collection is always a tedious process, but it’s an especially tedious process when one business is trying to collect from another. Business relationships are precious, and, unfortunately, easy to ruin. If you make another business mad in the process of trying to collect a debt, you could lose that vital connection.

Even if the connection is not one that is particularly important to you, you still have to be careful to operate within the bounds of the law. The Fair Debt Collection Practices Act stipulates that businesses and debt collection agencies may not harass debtors or use abusive practices, such as calling repeatedly or late at night, in the process of attempting to collect a debt.   

Whether you use a collection agency, which is advisable since it will save you time and money, or try to collect owed amounts on your own, your first step should always be to contact the business that owes you money and remind it of the debt. This initial contact should be done over the phone. Then, within five days of the phone conversation, a written notice about the debt may be sent.

From this point on, sending reminders on a regular basis is allowed and can often be helpful in keeping businesses up to date on paying off their debts. However, if you do not receive payment or any response, you also have the option of telling the debtor that you plan to take legal action, which you should do via a written notice.

As you attempt to collect a debt owed by a business, you must make sure that you are following all the rules and regulations put in place by The Fair Debt Collection Practices Act. Failure to do so could result in your business being sued or its reputation ruined.

As long as you pursue your debts in accordance with the law, however, no harm can come to you, and there’s also a good chance that you’ll even collect the money you are owed without ruining your relationship with the business debtor.

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