You try to be polite. You wait and wait. You send a “Past Due” notice. Still nothing. You send another reminder. Nothing. You phone and he will not pick up. Your “Past Due” notices are returned unopened. You’ve got yourself a non-paying customer.

You may see red. You may want to send a big scary friend over to visit him. But watch out! You should be aware that there are restrictions on what you can and cannot do to get your money.

What The Small Businessman Cannot Do To Collect Debts.

It is against the law to assume another identity in your dealings with the delinquent customer. You can not give a false name to the debtor.

Although you may feel like sending him mail that looks like it came from a credit bureau, or a lawyer’s office, do not do so. This is expressly forbidden as a collection strategy. You may land yourself in legal trouble with this tactic.

You cannot ignore the fact that the debtor is disputing the bill. If the debtor disputes the bill within thirty days of receiving it, you must stop contacting him about it. You must address the customer’s dissatisfaction before going any further.

You cannot take funds sent to you for a non-disputed bill, and apply that money to the disputed bill. You must apply that money to the invoice for which the customer intended it.

You cannot deposit a post –dated cheque earlier than the date specified on the cheque. This is not allowed, even if the bank agrees to do it.

You cannot say that you have hired an attorney, or are about to do so, if this is not true. This is construed as a verbal threat.

You cannot say that the debtor is guilty of committing fraud. This has to be determined through the legal system.

You cannot claim that the debtor owes more than he does.

You cannot state that you have sent legal papers to the debtor. You cannot even tell him that you plan to do so.

You cannot state that the debtor’s arrest is immanent.

You cannot make threats such as that you are about to sell things belonging to the debtor, garnish his wages, seize his property, etc.

You cannot harass the debtor by phone. This includes calling the debtor outside of normal business hours, calling collect, and leaving messages which reveal that debt collection is the reason for calling. You are also forbidden to call many, many times. You are not allowed to wage a phone war on the debtor, driving him to distraction.

Swearing is not permitted.

You must not send deceptive mail to the debtor. If you send him mail that looks as though it came from a lawyer or a government agent, you will be liable for prosecution.

You may not send mail which states on the outside that you are trying to collect a debt from the debtor. This includes postcards, where the written message can easily be read by others. Also forbidden is stationery with external text identifying the mail as debt-related.

Do not let the above information prevent you from attempting to collect the money owed to you. You will find that the same legal system which stops you from using the above strategies also provides you with effective ways of receiving your just desserts.

Also Check Out:

• How Do Commercial Debt Reduction Companies Work?
• Debt Relief From Debt Consolidation
• How Do YOU Spell Debt Relief?
• Debt Consolidation in Canada
• Asset and Liability Explained