Even the most cautious businesses will occasionally suffer from bad debts that can harm your cash flow and ability to operate, as well as potentially threaten the future of your business. Chasing these debts can be time-consuming and frustrating, but our expert debt recovery solicitors can take this burden off your hands, quickly and cost-effectively recovering the money you are owed.
Chattertons’ highly experienced debt recovery solicitors handle volume debt recovery as well as one-off debt recovery services. We can also review your terms of business, credit control procedures and train your staff to reduce future incidents of bad debt and facilitate faster debt recovery.
We have years of experience recovering debts for a wide variety of businesses, having developed a friendly but practical approach that means we are usually able to secure outstanding payments without harming your business relationships. Our team will take the time to understand your situation and priorities, then adopt a strategy that allows you to recover the money you are owed while matching your overall business goals.
How we recover business debts
In many cases, all it takes is a well-written letter from our debt recovery team to encourage prompt payment of money you are owed. Where this is not effective, we can start Court proceedings that can result in a number of options to help you recover a debt.
We will submit a claim to the relevant Court with details of who owes you the money, how much it is and what the debt is for. We may also be able to claim interest on the debt and a contribution towards your legal fees.
If judgement is obtained in your favour, there are various enforcement options:
- Instructing a bailiff to seize goods under a Warrant of Execution
- Deductions from the debtor’s wages under an Attachment of Earnings order
- Ordering the debtor to attend Court for questioning
- A Charging Order over property owned by the debtor
- Bankruptcy or liquidation
- Obtaining payment directly from a third party e.g. the debtor’s bank
Occasionally, there may be a genuine dispute about the debt. If this is the case, our Dispute Resolution Team specialists can advise on a range of commercial disputes from breach of contract cases to professional negligence claims.
How we can help your business avoid bad debts
When it comes to business debts, prevention is better than a cure. We can advise you on a range of measures you can put in place to ensure your next lucrative deal doesn’t turn into a massive liability.
For example, researching a customer's ability to pay at the outset can save a lot of effort and expense later, so we recommend taking out a credit reference before you agree to supply a new customer or offer a higher level of credit than you would normally. Ensuring that you have well-drafted Commercial Contracts including standard terms and conditions can also aid debt recovery and reduce the scope for disputes.
We can advise your credit control staff on developing and implementing clear and effective policies such as these, as well as giving them tips on how best to chase debts in the initial stages. This can help to minimise the risk of bad debts in future and make it easier for you to recover outstanding payments yourself, saving you time and money.
Clients often ask us……
How much does debt recovery cost?
We know that cost is important to your business. There is no point running up a bill of £1,000 over a £500 debt. On the other hand, £100,000 of legal costs to recover £5m of outstanding debts is value for money, especially if you also recover the bulk of your legal costs from the other side.
As well as traditional hourly rates, we offer a range of alternative charging structures in appropriate cases, including:
- Fixed fees for specific tasks or stages of work
- 'No Win, No Fee’ arrangements
- Preferential terms for volume debt recovery
Professional debt collection can cost less than you might expect and our aim is to always make sure that our debt recovery solicitors offer a cost-effective service, so you can get the maximum benefit from the funds we unlock.
How long does debt recovery take?
This depends on the circumstances. In many cases, once our debt recovery solicitors contact someone who owes your business money, they pay straightaway. In other cases, for example where we need to take court action, it can take longer.
If we initiate Court proceedings, the Court will usually give a debtor 14 days to make payment or dispute the debt. If they dispute the charge, they will normally be given another 14 days to present their case.
If the debtor disputes the debt and the Court finds in your favour, or the debtor simply fails to respond, the Court will likely issue a County Court Judgement (CCJ) giving the debtor 28 days to pay, or else face the prospect of the CCJ remaining on their records for 6 years.
This means that the majority of debts can be resolved within around 2 months.