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How to Approach Debtors

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Do you work in credit or finance?

Want to decrease your probability of delinquent accounts?

There are steps you can take to make customers take you more seriously and potentially comply with your demands. One of the biggest factors is your approach. The correct approach can make the difference between getting paid and having to go to court.

Determine Reason for Non-Payment ‒ The first step to deciding the right approach is to determine why the debtor has not paid. Debtors don’t pay either because they can’t pay or because they don’t want to.

Can’t Pay ‒ Most non-payments result from a real or imagined lack of cash flow. These debtors usually want to pay, but feel like they can’t. If this is the case, act as their problem solver. They have debt, you have solutions! You need to convey to them that you are partners and only want to help them. This will put them at ease and make them far more likely to comply. When negotiating with them, if they have poor cash flow, offer them a structured payment plan to pay off the debt. Once you both agree on the plan of action, get everything down in writing and have the debtor agree to the terms in writing.

Won’t Pay ‒ Debtors who won’t pay often create problems that they believe justify nonpayment. The problem could be real, but is usually invented by the debtor. Examples include: the products or services weren’t satisfactory, there was a breach of the contract, someone oversold them, etc. The best thing you can do is patiently listen. If their problem is actually valid, offer to fix it to their complete satisfaction if they pay in full. If it isn’t valid, politely tell them why. If they are still being difficult, offer a settlement for less than the full balance as an inducement to save money and resolve the issue without further action. If you go with a settlement, be smart when negotiating. Always start higher than the bottom line and never accept the first offer. 

Take Advice from the Trusted Debt Collectors in Michigan

If you’ve done all of the above and still need help, Ross, Stuart & Dawson can assist you! Certified by the Commercial Law League of America and endorsed by the International Association of Commercial Collectors, Ross, Stuart & Dawson has the know-how to get you the money you deserve.

Our kind, professional-approach is empathetic yet firm and manufactured for success! For a trusted commercial debt collector in Michigan, call RSD today at 888-701-8181 or contact us to start taking care of your delinquent accounts.