Why we prefer to settle debt problems without legal action

When it comes to handling debt collection issues with your clients, the last thing you want to do is go to court. Which is good, because that’s the last thing we want to do!

Of course, where necessary, we will assist you with court action, but any such action is usually as a last resort – and not the first port of call. This might sound a little unusual, especially for a professional debt collector, but there is method to our madness. And frankly, it’s not really madness! So today we wanted to dive into why we prefer to settle debt issues with your clients outside the courtroom.

Preserve Relationships

The main reason to avoid going to court over a dispute with a client is that it pretty much destroys any hope of you rebuilding that relationship. Once you take someone to court, they rarely want to work with you again, and for many businesses this can have a serious impact on you and your business professionally, and reputationally. So if you want to rebuild a relationship and continue working with that client, you are always better off working out the issue outside of court. Many cases can be solved with simple negotiation, mediation or even just a letter, which allows you to open a dialogue and resolve things amicably.

More Likelihood Of A Positive Outcome

Along with the potential to preserve the existing relationship, you also have a much higher likelihood of achieving a positive outcome without court action. Court action tends to ruffle feathers, and some people can decide to close down, or just dig in their heels if court is on the cards. But if you are willing to approach it from a different angle, are willing to negotiate repayment terms or discover the reason for the late payments, then you are more likely to get a positive response from the client and come to a mutual agreement. This outcome will be much more agreeable to both parties, which is ultimately the aim, after all.

More Can Be Achieved With Less

When it comes to debt collection, a lot of people think they need to go in hammer and tongs to get results. Many businesses will opt to go right to small claims court once an invoice has been overdue for a month or more, sometimes without looking for an alternative course of action. In reality, you can often get results without having to go that far. Carefully worded emails and phone calls, or even a letter from a solicitor or debt recovery agent can achieve the same results, cost you less and keep that all-important relationship intact.

At Debtcol, we believe in trying to settle things outside of court as much as possible. Whether that’s negotiating a payment plan or sending a letter, we will always exhaust all other options before we suggest progressing to court to claim your money back. If you would like to know more about how we work, or have a question about our debt collection process, just get in touch with the team today.