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Handling Non-Payment for Distributed Technology Products


Handling non-payment for distributed technology products can be a challenging aspect of business operations. In this article, we will explore a Recovery System for Company Funds and provide recommendations for handling non-payment situations. It is crucial for companies to have a strategic approach in place to address non-payment issues effectively and efficiently.

Key Takeaways

  • Implementing a structured Recovery System is essential for the successful recovery of company funds.
  • Thorough investigation of non-payment cases is crucial for determining the best course of action.
  • Consider closure of cases where the possibility of recovery is unlikely to avoid unnecessary costs.
  • Proceeding with legal action should be a strategic decision based on the assessment of the case and potential outcomes.
  • Collaborating with experienced attorneys can enhance the chances of successful debt recovery.

Recovery System for Company Funds

Phase One

Within the first 24 hours of initiating Phase One, a multi-pronged approach is deployed to secure payment. Immediate action is taken to notify the debtor through a series of letters, while extensive skip-tracing and investigation efforts are undertaken to gather optimal financial and contact information. Our team engages in persistent communication attempts, utilizing phone calls, emails, text messages, and faxes to reach a resolution.

Daily contact attempts are standard during the initial 30 to 60 days. Should these efforts not yield results, the process seamlessly transitions to Phase Two, involving our network of affiliated attorneys.

The effectiveness of Phase One hinges on its urgency and comprehensive approach:

  • First of four letters dispatched via US Mail
  • Skip-tracing and investigative actions
  • Persistent collector engagement with the debtor

This phase is critical for setting the tone of the recovery process and demonstrating the company’s commitment to retrieving owed funds.

Phase Two

Upon escalation to Phase Two, the approach intensifies as attorneys demand payment. This phase is marked by a series of strategic actions:

  • The assigned attorney drafts and sends a series of stern letters to the debtor, emphasizing the urgency and seriousness of the situation.
  • Concurrently, attempts to reach the debtor via phone calls are increased, ensuring that the message is conveyed directly and personally.

If these efforts remain unsuccessful, a critical decision point is reached. The company must consider whether to proceed to Phase Three or to explore alternative resolution methods.

The effectiveness of Phase Two is crucial, as it sets the stage for potential litigation and serves as a final warning to the debtor. The company’s resolve in this phase can significantly influence the debtor’s willingness to settle the outstanding debt.

Phase Three

Upon reaching Phase Three, the path forward becomes clear. If the debtor’s assets and the case facts suggest low recovery prospects, we advise closure of the case, incurring no further costs to you. Conversely, should litigation seem viable, a critical decision awaits.

  • If you opt out of legal action, you may terminate the claim without owing our firm or affiliated attorney.
  • If you choose to pursue, upfront legal fees apply, typically between $600-$700.

Upon initiating litigation, we strive for full recovery, including filing costs. Failure to collect results in case closure with no additional fees owed.

Our fee structure is straightforward:

Claims Quantity Accounts < 1 Year Accounts > 1 Year Accounts < $1000 Attorney Placed
1-9 30% 40% 50% 50%
10+ 27% 35% 40% 50%

These rates reflect our commitment to competitive, fair pricing based on the age and amount of the claims, ensuring our interests align with your successful fund recovery.

Recommendations for Handling Non-Payment

Closure of the Case

When the recovery assessment indicates that the likelihood of debt collection is minimal, the pragmatic step is to close the case. This decision is made after a comprehensive review of the debtor’s financial situation and the surrounding facts of the case. Closure means no further obligations to our firm or affiliated attorneys.

In instances where closure is the chosen path, clients have options:

  • Withdraw the claim with no fees owed.
  • Continue standard collection activities, such as calls and emails.

Should the decision to close the case be made after legal action has commenced, and if the litigation efforts are unsuccessful, the case will be closed with no additional costs incurred by the client.

It is essential to weigh the costs and potential benefits before proceeding with legal action, as upfront legal fees are required and can range from $600 to $700.

Proceeding with Legal Action

When the standard collection efforts fail to yield results, proceeding with legal action becomes a necessary step. The decision to litigate is significant and involves upfront legal costs. These may include court costs, filing fees, and other related expenses, typically ranging from $600 to $700. Upon deciding to litigate, you will empower an attorney to file a lawsuit on your behalf, aiming to recover all monies owed.

Options for debt recovery include proceeding with litigation, withdrawing the claim, or continuing standard collection activities.

It’s crucial to weigh the potential recovery against the costs involved. If litigation is unsuccessful, the case will be closed, and you will not owe additional fees to the firm or the affiliated attorney. Below is a summary of the collection rates based on various factors:

Claims Submitted Accounts Age Amount Collected Rate
1-9 Claims Under 1 year Under $1000 50%
1-9 Claims Over 1 year Any amount 40%
10+ Claims Under 1 year Any amount 27%

Remember, the choice to pursue legal action should be made after careful consideration of the debtor’s assets and the likelihood of recovery.

Struggling with unpaid invoices can be a major setback for any business. At Debt Collectors International, we specialize in turning your overdue accounts into paid ones. Our expert team is equipped with the skills and resources to handle every aspect of debt collection, from skip tracing to judgment enforcement. Don’t let non-payment disrupt your cash flow. Visit our website now to learn more about our no-recovery, no-fee services and take the first step towards reclaiming your funds.

Frequently Asked Questions

What is the Recovery System for Company Funds?

The Recovery System for Company Funds consists of three phases: Phase One involves sending letters to debtors, skip-tracing, and contacting debtors for resolution. Phase Two includes forwarding the case to affiliated attorneys for legal action. Phase Three offers two options: closing the case if recovery is unlikely or proceeding with litigation.

What happens if recovery is not likely in Phase Three?

If recovery is not likely in Phase Three, the case may be recommended for closure, and you will not owe anything to the firm or affiliated attorney. Alternatively, you can choose to proceed with legal action by paying upfront legal costs for filing a lawsuit.

What are the costs involved in proceeding with legal action in Phase Three?

The costs of proceeding with legal action in Phase Three include upfront legal expenses such as court costs and filing fees, which typically range from $600.00 to $700.00 depending on the debtor’s jurisdiction.

What are the collection rates for DCI based on the number of claims submitted?

DCI’s collection rates vary based on the number of claims submitted. For 1 through 9 claims, rates range from 30% to 50% of the amount collected, while for 10 or more claims, rates range from 27% to 50%.

What actions are taken in Phase One of the Recovery System?

In Phase One, letters are sent to debtors, skip-tracing is conducted, and debtors are contacted for resolution. Daily attempts are made to contact debtors for the first 30 to 60 days. If unsuccessful, the case proceeds to Phase Two.

What occurs in Phase Two of the Recovery System?

In Phase Two, the case is forwarded to a local attorney who drafts letters demanding payment from the debtor. The attorney contacts the debtor and continues attempts to resolve the account. If unsuccessful, recommendations for the next steps are provided.