About Debt Collection Letters Tips

Bad Debt Collection Letters

Another example of a bad debt collection letter is to design a form with your name, address, phone number, and company logo on it. It would also include the following information:

(Your Company Logo)

RE: Account # _____________________ (Date)

Balance Due: $____________

Minimum Payment Due: $___________

Dear Mr. John Doe:
Your account is now past due. Please send us your payment today. Thank you.

Sincerely,
Creditor Company (or name of business)
(Address)
(Phone)

(Your Company Logo)

RE: Account # _____________________ (Date)

Balance Due: $____________

Minimum Payment Due: $________________

Dear Mr. John Doe:
We have not heard form you in awhile, and we just wanted to remind you that your account is past due. We hope to hear from you soon!

Sincerely,
Creditor Company (or name of business)
(Address)
(Phone)

Comments

   

Notice of Dishonored Check

"For debtors who paid with checks that have resulted in a dishonored check or NSF check, send these type of debt collection letters:
Date:
To:

Your check in the amount of $_________ and dated __________ has been dishonored by your bank due to insufficient funds. We have verified with your bank that this amount still cannot be presented against your account and paid in full. Unless we receive payment for said amount within _______ days (or such further time as may be allowed pursuant to state law), we shall have no other choice but to commence appropriate legal action to recover payment from you.

Sincerely,
Name of Business"

Comments

   

Letter for Receiving Partial Payment

Another example of a bad debt collection letter is to send a thank you letter for receiving partial payment from your customer. A simple, friendly letter will be alright:

(Address Element) (Date)

Account #_____________________________

Balance Due: $____________

Minimum Payment Due: $___________

Dear Mr. John Doe:
Thank you for your partial payment of $___________, which has been applied to your account. We appreciate your business, and we are certain that sending the wrong amount was merely an oversight. For the record, your minimum monthly payment is $_________. Please send us your check for at least $________ today to being your account up to date. Thank you very much.

Sincerely,
Creditor Company (or name of business)
(Address)
(Phone)

Comments

   

More Bad Debt Collection Letters

Hopefully your letter will yield some results. You should receive the payment or at least a phone call to make payment arrangements. If, however, another week goes by without a check or a phone call, the debtor reaches a new plateau. If a consumer is at the 45-day mark and you have not yet been paid, it is time to up the results a bit. After all, in 2 weeks, they will be at the sixty days past due mark. This time, write a past due debt collection letter and send it via certified mail with a return receipt, evidence that it was received.

(Address Element) (Date)

Account #_____________________________

Balance Due: $____________

Minimum Payment Due: $___________

Dear Mr. John Doe:
Your account is seriously past due! You have not sent us the previous month's payment and, in a short time, another monthly payment will be due. While we appreciate your business, we find your failure to communicate with us disquieting. Please be advised that we cannot consider extending additional credit to you until you have paid off your past-due balance. Please send us your check in the amount of $________ today, or call our office to make payment arrangements. Thank you.

Sincerely,
Creditor Company (or name of business)
(Address)
(Phone)

Comments

   

Collection Letters to the Seriously Late

It's difficult to come up with how late is considered “seriously late.” Large companies with steady cash flows tend to be a lot more patient than small business owners or consultants. As a result, larger companies may keep trying to collect using letters and phone calls for several months before charging off the account and handing it over to a debt collection agency or attorney. If you are a small business owner in this case, you need to move more aggressively earlier in the game. Begin by closing the account first.

(Address Element) (Date)

Account #_____________________________

Balance Due: $____________

Dear Mr. John Doe:
Your account is seriously past due, and your failure to contact us leaves us no choice but to close your account, effective immediately. We are willing to work with you, but in order to do so we need to talk with you. Please call out office today. Thank you.

Sincerely,
Creditor Company (or name of business)
(Address)
(Phone)

The previous letter did not include a minimum payment amount because we want the debtor to see the full amount and realize why you closed the account. That you are willing to work with them should encourage them to pick up the phone at least. A letter requesting partial payments is another option you may consider.

(Address Element) (Date)

Account #_____________________________

Balance Due: $____________

Dear Mr. John Doe:
We were recently forced to close your account with us because you have not made any payments since _________, and you have also failed to contact our office. If you are experiencing financial difficulties, we can work out a payment schedule that will enable you to deal with meeting your obligations. In order to do so, we need to know the problems you are facing so that we can work together to resolve them. Please call us today. Thank you.

Sincerely,
Creditor Company (or name of business)
(Address)
(Phone)

Comments

   

Working Out Payment Plans with Debtors

If you as the debt collection agency are working with uncooperative consumers who will not communicate with you, send the following bad debt collection letters:

WHAT IS GOING ON?

We cannot understand why you will not take the time to bring your seriously delinquent account current or at least call us to work out arrangements to settle your debt. Ignoring invoices and phone calls will not make this obligation go away! Call our office today!

(Phone and Address Element) (Date)

Account #_____________________________

Balance Due: $____________

_______________________________________________________________________________

THE INTEREST METER IS RUNNING!

Your failure to deal with your seriously past due account is not making your steadily increasing balance go away! The terms and conditions under which you assumed this obligation allow us to charge interest on unpaid balances. So, the balance due continues to increase. We are willing to work with you, but the first step taken has to be yours. Call us today!

(Address Element) (Date)

Account #_____________________________

Balance Due: $____________

Comments

   

Dishonored Check Placed for Bank Collection

For dishonored NSF checks placed for bank collection, send the following debt collection letters:
Date:
To:

I enclose and place with you for collection and credit to our account the below identified check previously returned to us due to insufficient/uncollected funds.

Check signed by:

Date of Check:

Amount:

Drawee Bank:

Account Number of Check Signer:

Please charge our account your service fee for processing this check on a collection basis. We would also appreciate notification when the check clears, or return the check to us should it remain uncollected. Our account number is ____________________________.

Sincerely,
Name of Business

Comments

   

Partial Settlement Letters

Here are a few sample collection letters for accepting the debtor's offer:

(Your Letterhead)

(Address Element) (Date)

Account # __________________________

Balance Due: $_______________

Dear Mr. John Doe:
We have received your offer to settle this account by making a lump sum payment of $___________. We are willing to accept this amount provided that we receive the money no later than _____________. Otherwise, the balance due will revert to the full amount and additional charges may also apply. When your check clears, we will send you a final statement marked “Paid In Full.” Thank you.

Sincerely,
Creditor Company (or Name of Business)

(Your Letterhead)

(Address Element) (Date)

Account # ____________________________

Balance Due: $____________

Dear Mr. John Doe:
We are in receipt of your office to settle this account for $____________ not later than __________. You have offered a down payment of $_________ and monthly payments of $___________ until the settlement figure is reached. We are willing to accept the offer, provided that you meet your proposed payment schedule. Failure to do so will result in the balance due reverting to the full amount plus any applicable interest charges and/or late fees. When you have met the terms of this agreement, we will send you a final statement indicating that the balance has been paid in full. Thank you.

Sincerely,
Creditor Company (or Name of Business)

Comments

   

B2B Relationship

About debt collection letters:

Here is a sample collection letter to send from one business to another business who is behind making their payments:

(Your Letterhead)

(Address Element) (Date)

RE: Your Past-Due Account

Dear Mr. John Doe, owner of Business 1,
I must confess that I am somewhat perplexed by your refusal to at least return my phone calls. Your surprising failure to communicate has left me no choice but to close your firm's credit line with us. We have supplied high quality goods and services to you in a timely manner, fully living up to the terms of our agreement. In return, we expected you to meet your obligations. Past-due accounts are charged interest at a rate of _________. This means that, as of today, your original balance of $________ has risen to $________, and the balance due will continue to grow. I hope that you will give this important matter the full attention it deserves by calling me today and making arrangements to keep your part of the bargain.

Sincerely,
Owner of Business 2

Comments

   

When the Account Is Past due - Sending Faxes and Email

If a customer has gone 30 days beyond the due date without paying you (the business owner), it is tempting to send a past-due letter via e-mail. Don't do this! It's too easy for your message to fall into the wrong hands-someone other than the debtor-and that's what is known as third-party notification, which is illegal and unethical. It could cause you all kinds of problems. You are better off sending past due sample collection letters via regular mail. You must do everything you can to keep from embarrassing the debtor publicly by inadvertently information someone else. However, if your invoices and routine reminder phone calls are not getting you anywhere, consider sending some electronic quickies via fax or email.

(Your Letterhead)

(Address Element) (Date)

Dear Mr. John Doe:
I have not heard from you in awhile, and I would welcome the opportunity to talk with you soon. Please call me today. Thanks.

Sincerely,
Creditor Company (or name of business)

____________________________________________________________________________________________________________
(Your Letterhead)

(Address Elements) (Date)

Dear Mr. John Doe:
Telephone tag is no fun! I have been unable to get through to you for some time now, and I really need to talk to you. I will be available from ___________ to ____________ today and tomorrow, and I have left express orders to route your call right through to me.

Sincerely,
Creditor Company (or name of business)

Comments