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Collections Law/Collecting money owed to small business
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Question
I own a small dance studio and have numerous customers skip out on paying tuition. This has been remedied by removing students from the classroom, however I need a tool to collect from previous clients who no longer dance with us.
DO you have the parents sign a contract? If so, you can enforce your contract through small claims court. But before doing this set up a series of letters designed to remind the client of their obligation from a friendly reminder to the final collection notice. Always offer some incentive to the client to settle the obligation before taking action and make sure to be kind and respectful to your clients as much as is possible. Most people want to pay their bills they just run into hardships that prevent them from doing so. This does not mean that some wont take advantage of you but use some discernment about who is legitimate and who is trying to blow smoke at you to avoid paying the debt.
My experience is that if you work with people and they are willing to give you the facts and lay their situation out honestly, work with them and you will get paid and keep a customer. In other words, don't burn your bridges with your clients being a hardass bill collector. All you will do is run them off or cause them to react strongly and avoid you.
Treat others as you would want to be treated and forgive those debts when the debtor is in legitimate hardship.
I hope this helps.
MIke
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Answers by Expert:
Michael Brotherton
Expertise
Consumer/Debtor Rights Advocate. Mike Brotherton is a negotiator with over 30 years experience in consumer lending and collections. Mike has 30 years in the credit and collections industry as a former loan officer, debt collector and manager of two finance companies over several years. Mike is well versed in Loss Mitigation practices and the legal collection process. He has helped literally thousands of people over many years overcome serious financial problems such as foreclosure, creditor lawsuits and abuse by debt collectors. For more information about resolving your "financial emergency" visit www.financialemergency.com. FinancialEmergency.com is a consumer web site which actively promotes Fair Debt Collection Practices and other consumer protection laws. We teach DEBTOR RIGHTS and enforcement of those rights. The more informed you are of your rights and the credit collections practices of creditors the more peace you can have dealing with your FINANCIAL EMERGENCY. Most financial problems are fairly common and as such have some very common solutions. The key is understanding your rights in the collection process and how to enforce them if need be. Primary business- Debtor Rights Advocacy and Debt Mitigation relating to foreclosure, creditor lawsuits, and other serious financial problems. www.financialemergency.com (copy and paste in browser).
Experience
Over 40 years combined experience negotiating disputes and resolving financial issues related to consumer debt, corporate issues and mortgage modifications.
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