Owning a small business has its pro’s and cons but when it comes to debt collection owning a small business is so much more about stress than anything else. Many companies or small businesses across the country often fail due to debt collection, or at least a failure of it. So in order to increase your chances of success as a company, you need to be empowered with the resources, information and knowledge of what the laws are with regards small business debt collections. Ultimately, it might be in your best interest to consult with a small business attorney nyc to have them guide you on the best ways to go about your debt collection activities while ensuring you don’t break any laws
There are a number of practices that are prohibited when dealing with debt collection for small business, and being aware of what they are can only be beneficial to you. When collecting a debt, you are only allowed to collect what is owed to you, and only if there has been a legal agreement of interest to be added are you allowed to collect this, but it all has to be constituted legally.
You can also not continue to claim for debt if it has been disputed by the debtor unless you have written or physical evidence backing your claim. You are however not supposed to contact the person owing within 30 days after they have disputed your claim. No post dated checks can be deposited and you are also not allowed to credit any payment made of a non-disputed debt to one that has been challenged in anyway.
While this process can be a long one it is better to do things legally with hopes that you might win the claim rather than to jeopardize and payouts due to false information being provided such as other names being used to collect the debt.
You can under no circumstance make people believe that you are contacting them from an attorney’s office or any government organisation if this is not true at all. Any false claims will only put yourself in a position where the debtor can ultimately pursue a case against you. Always have accurate information and never state that the person owes you more or less than what it really is as this would affect your claim negatively.
Remember that threatening the debtor to remove any of their possessions is illegal if there is nothing set up as collateral. These types of threats can make you end up on the wrong side of the law. Also, never make any false claims about any legal documents being sent unless you are truly doing so. While this may be frustrating, making sure you handle this correctly could lead to a greater chance of you actually being paid the debt owed you.
If you wish to involve a third party to assist you with you claim always remember that there are laws in place for this as well. So make sure that your third party involved is clued up on this so it does not affect you in any negative way. You are not allowed to give any false credit-related information to the debt collector. Only information that is accurate and valid should be given. No information about the debtor should be given to anyone other than the debtor as this is confidential or should not be shared with anyone else at any time. Do not contact anyone other than the debtor more than once.
When contacting a debtor you are only allowed to call between the hours of 8am to 9pm and you are required to give your name and company information. No false information should be given. You are not allowed to make any threats or call repeatedly at any time.
When contacting the debtor by mail please ensure that what is being sent is stated on the envelope.