The fact is that 77% of American households have some kind of debt. But how much do these households owe? Let`s add a few dollar numbers to this statistic. Auto loan withdrawal usually begins after 60 days. Credit cards, on the other hand, usually go to an internal collection department before going to a formal collection agency. A collection letter can serve one, some or all of the following purposes: The following sample letters will help you if you have common issues that may arise with debt collection agencies. The total debt in the United States is $14.96 trillion. According to Ramsay Solutions, this represents an average of $158,209 per household. Mortgages make up the bulk of debt, followed by student loans, then car loans and finally credit card debt. There are other costs as well, but these are the most common. Therefore, it is important that every lawyer has legal professional liability insurance, which would help you, among other things, defend claims for negligence or malpractice. You`re fully aware that you can never be too careful when it comes to defending a lawsuit, and any investment in protecting your business is a wise investment. By creating a collection letter template, you can easily create a personalized letter for all customers with overdue payments.
With a template, you can ensure that your collection letter for lawyers contains all the essential details. [If it is the first or second collection letter:] This letter is a reminder [or “another reminder” for a second letter] that any balance of $[amount] in your account due on [date] remains unpaid. Please send us your payment [as soon as possible or within X days of the date at the beginning of this letter] [insert payment instructions here]. While we look forward to continuing our business relationship with you, we cannot do so if your balance remains unpaid. As a starting point, you should carefully review the letter to determine the validity of the application. When a lawyer or collection agency sends a letter to a consumer or business, they state that a certain amount is due and likely overdue. Of course, this necessarily means that their claim is valid. In general, collection letters fall into one of the following categories: However, debt collection agencies should always be your last resort, as they can be quite expensive. Generally, if you send a debt to debt collection, your agency will keep a significant portion of the debt as payment, so agencies are often unable to collect small claims. Also, sending a customer`s debt to debt collection is a surefire way to sever relationships with that customer, so make sure you`re ready to burn that bridge before you take action. If you wish to dispute this debt, you can legally do so with a letter of confirmation of debt submitted within the [deadline] of the date indicated at the top of this letter.
If you do not submit a confirmation letter within this period, you will be deemed to agree to have your debts sent to debt collection. Depending on how this process ends, you may decide if you want to continue working with the client or ask them to look for another lawyer to meet their legal needs. If the collection process ends amicably and without legal action, your letter has been successful and there is no reason to end your relationship with said client. If you decide to hire a debt collection agency, check out our collection agency reviews. Our reviews highlight the best small business debt collection agencies, B2B debt collection, B2C debt collection, and low-cost services so you can get your debt with as little effort as possible. If you use any of these letters, it is important to do so as soon as possible after the initial contact and to keep copies of any letters you send. In some situations, you only have 30 days after being contacted to request specific information, but even if more than 30 days pass, it`s still a good idea to ask for what you need. In these cases, a collection letter from your lawyer can initiate a payment negotiation and create a solution that works for both the client and the lawyer. I am writing to inform you that your balance of $1,000 [overdue amount] for invoice # 2010101 for legal services related to your malpractice claim against Dr. Z completed on May 20, 2022 [invoice number or identification details] was due on June 1, 2022 [payment due date] and is now 43 days [# of days currently overdue]. Please note that according to our order letter, an interest charge of 1% per month will be charged on all unpaid amounts within 30 days of the invoice date.
[Provide full details of contract or engagement letter] Did you know that a collection letter can inform a debtor of their debts, initiate a repayment schedule, give an overview of an upcoming court case, or a combination of these tasks? It`s incredibly frustrating to end a contract with a client and not get paid. Instead of erasing unpaid bills from clients who don`t pay, a collection letter for lawyers officially gives clients a clear opportunity and motivation to pay off their debts.