How to Apply Pressure and Achieve Good Outcomes in Construction Debt Collection
How to Apply Pressure and Achieve Good Outcomes in Construction Debt Collection
There are all types of customers in the world of construction debt collection. Some are willing to workout a payment plan with you. However, others my fight your requests for payment or ignore them entirely. An experienced debt collection firm knows how to apply the right amount of pressure at various phases of the debt collection process. Pressuring a customer does not mean harassment and intimidation. Being overly aggressive can alienate the customer. The key is applying enough pressure to revive payment while still remaining professional.
A Necessary Debt Collection Tool
Debt collection firms play an important role in the economy. Extending credit to customers relies on trust that the debt will be paid. Knowing there is an skilled debt collection firm to turn to helps construction materials suppliers feel more secure in selling on credit.
Pressure is a necessary debt collection tool that helps ensure creditors get paid. When speaking with customers, be firm while remaining professional. Demand prompt action and set specific deadlines.
When to Apply Pressure
Knowing when to apply pressure is a subtle skill. It’s important to take into account the reason behind the default. Experienced debt collection firms develop individualized payment plans that lead to better outcomes. If the customer cannot afford the balance, there is no point is pushing for a lump sum. Instead, work out a payment plan and use pressure to ensure the debtor meets the deadlines. Here are four times to apply pressure in construction debt collection.
1. When the customer ignores calls
Daily phone calls, emails, or letters can persuade some debtors to come to the table. However, avoid contacting the same customer multiple times per day. Numerous calls on the same day are considered harassment under the Federal Trade Commission (FTC) regulations.
2. When a customer continues to ignore calls
Debt collection firms may reach out to other people. Calling a customers boss, friends, or family provides added pressure. Remain professional when contacting the debtor’s associates. Limit your questions to discovering contact information for the debtor. Avoid talking about money owed to anyone but the debtors or their attorneys.
3. When the customer misses a deadline
Once you have worked out a payment plan, prompt action lets the customer know that the debt collection firm is serious. After one missed deadline, call the debtor the very next day. Be professional and firm. Insist on prompt payment or renegotiate a payment plan.
4. When a customer refuses to pay
If a debtor disputes a claim, provide the debtor with verification of payment owed. This lets them know you have proof of their debt. If they still refuse to make payments, it may be time to turn to legal remedies. Filing a lawsuit my put enough pressure on the customer. However, ethical debt collection firms let the legal action speak for itself. Avoid idle threats of reposition or arrest.
If you need assistance with the construction debt collection process, call The Kaighn Company at 908-319-5155 or email cmdevito@kaighnco.com.