Tips to Creditors
1. Obtain and Verify Credit Application:
Creditors often extend credit to assumed names, without knowing the actual name of the debtor, doing business under the assumed name. For example, Acme, Inc. may do business as Baker Company. If a credit application is completed in the name of Baker Company, it may be difficult to determine the true name of the party to be sued — Acme, Inc. doing business as Baker Company. Though a party can be sued in its assumed name, it is important to know specifically to whom creditor extended credit. Creditor should generally confirm through on-line research, or other information, the precise name of the party which is obtaining credit.
2. The Stalling Debtor – Get Written Admission of Debt.
Is a Debtor acting in good faith? Does he really need only to obtain payment from his customers in 21 days? Or, will he then need an additional 30 days? Is it prudent to grant these extensions without action? Probably not. Require the Debtor to commit. Even if he cannot pay, he can confirm the debt, in writing. Tactfully require a specific written admission of the debt. If Debtor refuses, or delays confirmation of the debt, the Creditor should consider prompt action. The Creditor may save 21 to 51 days, as in this example. Debtors sometimes attempt to stall for months.
3. The Unresponsive Debtor – Sue or Close.
A Debtor who ignores demands, is communicating his intention to avoid the debt. Creditor should decide to promptly sue or close the matter. This decision should be made after Creditor or counsel reviews available information, the apparent collectability of a judgment, and whether the debt is disputed.
4. Prompt Suit:
Blenden Roth strives to make immediate written and telephone payment-demand, and report findings. Unfortunately, these demands are often ignored. If suit is to be filed, we generally sue within 7 days of receipt of creditor’s authorization. Upon issuance of citation, the documents are promptly forwarded to an experienced process server, for service on Defendant.
We request, and work with court-appointed Receivers to seize Debtor-funds deposited in banks and financial institutions. Receivers can also collect Debtor’s accounts receivable. Receivership is a powerful collection remedy. Our firm has overseen hundreds of receiverships.