Letters of Demand
The first step in recovering a debt is well worded letters of demand. Initial letters of demand should be polite so that a commercial relationship can be preserved if the non-payment is merely an oversight. The intention is to let the recipient know the debt is overdue but says this in a polite way. It also increases the likelihood of payment if the initial demand is polite. Rude and overly threatening demands from the outset may have the effect of inducing a debtor to withhold payment. This collection contains three letters of demand, designed to be sent in sequence.
Initial Letter of Demand
Letter of Demand 1
Letter of Demand which is an initial letter of demand that is polite and assumes there may have been an oversight in not paying. Allows 7 days for payment.
1 page long.
2nd Letter of Demand
A letter of demand states how much is owed, what for and when the invoice needs to be paid. It may also include a warning that you will consider legal action if the debt is not paid by a particular date. … The best approach is to send your letter of demand to the person who owns the business
A Letter of Demand after 1st Letter is a more threatening letter that mentions legal proceedings and gives 7 days to pay.
Final Letter of Demand
A letter of demand is usually sent when you have tried unsuccessfully to get your invoice paid and it is the right time to take more serious action. Often this is the final reminder letter before taking legal action. You can send it yourself or ask a lawyer to write it on their letterhead.
Gives a further 7 days to pay before proceedings are commenced. Outline costs of proceedings and that these may be added to the debt.
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Checklist
An updated checklist includes points on what to cover before granting credit to determine if the client is creditworthy or if the debt is recoverable. These will assist in advising clients and will serve as a reminder to the practitioner on what to look out for when assessing the credit worthyness of new clients (and reassessing existing clients)
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