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What is the Debt Recovery process?

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Mika, Staff Writer

Tuesday, 16 March 2021

If there is one thing that can be hugely frustrating for any business, it is the process of trying to chase and recover a debt. Waiting on payable debt puts your business at risk of suffering from a lack of cash flow, resulting in your own monetary problems. 

So, what can you do about this outstanding debt? Hiring your own debt recovery and collection service could be the answer to your debt chasing problems and could help ease your stresses.

In this guide, we aim to take a closer look at debt collection and the processes you need to go through. We will also look at the pricing of these services so you can find the right one for you and your needs.

What is the difference between Debt Collection and Debt Recovery?

One of the best first steps to getting your debt recovered is undertaking the process on the correct terms. The main differences between debt collection and debt recovery are very slight and usually depend on the people trying to recover the debt. With debt collection, it is usually you as the business, or the one owed the money, who is seeking to collect the debt from the customer.

When it comes to debt recovery, this is usually done by a third party, separate from the party who is owed the debt. If it has got to this point, then you may have been chasing a debt for some time. By opting for debt recovery, you will be paying for expert debt recovering skills and a far better legal chance of recovering your debt.

How much do Debt Recoverers charge?

All debt recoverers and debt collectors have their own price tag. The cost of their services will depend on a number of factors and can change considerably depending on where you are operating throughout the world. One of the key factors that define the cost the most is how much the debt itself is.

Based on this approach, the larger the amount of debt, the higher the fee to the debt recovery will be. 

Is there a time limit on collecting a debt?   

With most national laws and legislation, debt collectors have six years to collect the outstanding debt or twelve if it is mortgage debt. This time period starts from the last payment, if any, you received from the debt payer. Although there is a time period set, you will still have lawful rights as a company owed a debt, and this can still be pursued. This time period should be enough time to have the debt you’re owed either repaid or taken on to the next legal stage.

To sum up 

While chasing debt can be a stressful process for any business, knowing the exact stepping stones to get the money owed is an important start. As long as you approach the debt collecting process with legitimacy and follow all laws and legislation while working with reputable debt recovery companies, there is nothing to stop you from collecting what is owed. So bring peace of mind and destress by contacting a debt recovery business today.

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