When it comes down to the myriad rules that govern debt collections, it’s clear that crafting a good letter to your customers is a skill that requires significant forethought. The details and the tone need to be in sync. At the same time, it’s important to treat your customers with empathy while also making the rules apparent with respect to clearing debt from their registers (and yours).
We came across an article on the Business News Daily website that offered insight on this very matter. It’s a practice that can help you avoid the extra steps of using a collection agency. And it’s a critical start to a process that can ultimately be a test of your customer service skills.
Different types of debt collection letters
The article presents several reasons why a company would need to send a letter in the first place. The main one is fairly obvious: you need to let a debtor know they owe you money. The basics call for the due date and the nature of the debt. It’s also important to treat the customer in a friendly, compassionate way from the outset.
You may also need to outline a payment process. Scheduling payment plans that make sense for your business can be one way to make sure you are both in agreement on how the debt can be paid in full.
At some point, though, you may need to outline legal concerns if the debt is unpaid for a long period. In that case, a separate letter down the road that goes into the possible legal actions a customer may encounter is essential. It’s at this point that if you don’t get a response to your satisfaction, a collections agency may be needed.
A handy list
The article in Business News Daily offers some elements to consider when it’s necessary to communicate with your customers about their debt. Among their recommendations:
- Include the amount of money owed.
- Also include the initial payment due date.
- Follow that up with the new due date for payment. You can write that it’s due “ASAP,” but a more formal date may be a better option.
- Outline the instructions on how to pay the debt.
- Be sure to add a phrase that asks the debtor to let you know if it’s an error or that it’s already been paid.
- You can also consider a sentence that notes that you still value and want the customer’s business, but that payment is required in order to do so.
- For later collection letters, it’s important to be compassionate but clear about possible legal action, including sending the debt to a collections agency.
- Also, make sure at later stages that you state the debtor can dispute the debt via a validation letter sent within a timeframe you set.
Following these protocols can ensure that customers not only remain loyal, but also make good on their obligations.
