Offering client a reduced amount for quick payment

[tony84]

I have a client who owes us a bit of money.
I feel for him because he has lost his business and I can only imagine what he is going through.

I have seen his business in the news and I can see he owes staff money etc.

Im debating saying if he can pay it by the end of the month I will cut his bill in half, but if he doesnt pay it by the end of the month then it will go back to the original amount and I will be filing it with small claims. Can I do that without committing myself to having to accept half if it goes into march?

 

[Gecko001]

I would not do that. It will feel to him like a threat and if you do get paid, you will not get what you are owed. An alternative is to suggest monthly payments, say one cheque dated now and three post dated by one, two, and three months. If he refuses, you could ask him for an alternative.

 

[Mark T Jones]

There's nothing illegal in a time constrained offer.

It seems that you are on negotiating terms, which is good - how about you give them the option between a reduced sum now, or monthly installments?

 

[Newchodge]

I have a client who owes us a bit of money.
I feel for him because he has lost his business and I can only imagine what he is going through.

I have seen his business in the news and I can see he owes staff money etc.

Im debating saying if he can pay it by the end of the month I will cut his bill in half, but if he doesnt pay it by the end of the month then it will go back to the original amount and I will be filing it with small claims. Can I do that without committing myself to having to accept half if it goes into march?

Unless you believe your client has money available, nothing ill make a difference.

 

[tony84]

One of the customers has a job where I think it would be frowned upon if she had a CCJ. Fairly sure they would find the money if they had to.
I dont want to do small claims, partly for myself but partly because I know they have a lot going on. But we are 4 months in now and we are at the end of the line of me being nice.

If he came up with a reasonable repayment plan I would happily accept it. But the line in the sand came and went on Friday so tomorrow I have to work out whether we receive payment or start the small claims process.

 

[Mark T Jones]

Unless you believe your client has money available, nothing ill make a difference.

It's all relative - unless they are bankrupt and on benefits, it's likely there will be some money (now or in the future)

It's often a case of nursing things, whilst establishing your place in the pecking order

 

[pentel]

I have a client who owes us a bit of money.
I feel for him because he has lost his business

Is the debt owed by the client or the clients company?
If the company is it a limited company?

 

[Gecko001]

It's all relative - unless they are bankrupt and on benefits, it's likely there will be some money (now or in the future)

It's often a case of nursing things, whilst establishing your place in the pecking order

Yes there could be a pecking order. Unfortunately, sometimes banks and other advisers, when dealing with customers who are in financial difficulties, will advise customers to pay nobody but those they "must" pay such as mortgage providers. Unfortunately, some debtors will regard every direct debit as a "must". Believe it or not those can include subscriptions to popular sports and drama streaming services!

Doorstepping them might get you up that pecking order, if you are not prone to temper outbursts. Remember, it is very easy to take the behaviour of a persistent debtor personally. Try to avoid that. Calling them on the phone at least once every two weeks can also work. Be persistent.

 

[Mark T Jones]

Yes there could be a pecking order. Unfortunately, sometimes banks and other advisers, when dealing with customers who are in financial difficulties, will advise customers to pay nobody but those they "must" pay such as mortgage providers. Unfortunately, some debtors will regard every direct debit as a "must". Believe it or not those can include subscriptions to popular sports and drama streaming services!

Doorstepping them might get you up that pecking order, if you are not prone to temper outbursts. Remember, it is very easy to take the behaviour of a persistent debtor personally. Try to avoid that. Calling them on the phone at least once every two weeks can also work. Be persistent.

I'm guessing this is consumer debt. And when I used to do such things, the saying in collections was

'You can do it the legal way or the illegal way. But once you step into illegal territory, you've lost the right to follow a legal process'

Doorstepping consumers is very much on the line there, but asking to meet is OK.

 

[Gecko001]

I'm guessing this is consumer debt. And when I used to do such things, the saying in collections was

'You can do it the legal way or the illegal way. But once you step into illegal territory, you've lost the right to follow a legal process'

Doorstepping consumers is very much on the line there, but asking to meet is OK.

Of course, you should not harass debtors, but meeting them face to face is not illegal, or is it? I was not suggesting you go to their home if they have an office. Phoning them is not illegal either as far as I know.

 

[tony84]

Is the debt owed by the client or the clients company?
If the company is it a limited company?

Owed by the clients.

Of course, you should not harass debtors, but meeting them face to face is not illegal, or is it? I was not suggesting you go to their home if they have an office. Phoning them is not illegal either as far as I know.

I suppose the issue with meeting face to face is that there is no record of what was said/agreed and it could turn confrontational.


I hate being in this position as it means something has gone wrong. As much as I feel for them, they have their mortgage and my lad who did it has been paid. So I am sat here out of pocket.

 

[Gecko001]

Owed by the clients.

I suppose the issue with meeting face to face is that there is no record of what was said/agreed and it could turn confrontational.


I hate being in this position as it means something has gone wrong. As much as I feel for them, they have their mortgage and my lad who did it has been paid. So I am sat here out of pocket.

You can make a note of what was said at the face to face meeting immediately afterwards, if not at the meeting itself, and keep it in the file. That is a record.

 

[Michael Loveridge]

I often advise clients in this sort of situation to make an offer to accept, say, 50% if the debt is paid by a fixed date. You should always use the words `without prejudice', which means that the debtor can't refer to your offer as evidence should the matter end up going to court.

And I'm afraid that I also advise clients that he who shouts loudest gets paid first. In any situation like this there will be numerous creditors, and in my experience those that act most aggressively generally do best, as there will be limited funds, and once the aggressive creditors have been paid there's often nothing left for the more lenient ones. It's not pretty, and one might wish that creditors who were willing to wait for payment were better rewarded, but it's the harsh reality of business.

 

[tony84]

But in

I often advise clients in this sort of situation to make an offer to accept, say, 50% if the debt is paid by a fixed date. You should always use the words `without prejudice', which means that the debtor can't refer to your offer as evidence should the matter end up going to court.

And I'm afraid that I also advise clients that he who shouts loudest gets paid first. In any situation like this there will be numerous creditors, and in my experience those that act most aggressively generally do best, as there will be limited funds, and once the aggressive creditors have been paid there's often nothing left for the more lenient ones. It's not pretty, and one might wish that creditors who were willing to wait for payment were better rewarded, but it's the harsh reality of business.

I think in his case my debt is owed by Mr and Mrs. Knowing what she does and who she works for, I dont think a CCJ would go down to well so she would presumably want to avoid it.