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Business Debt and Debt Recovery

Debt recovery can be one of the most vital processes to ensure your business stays afloat, as debtors can turn an otherwise profitable business into one with serious cash flow problems. Many solicitors are able to offer a fixed fee service to chase up debtors in the early stages of a dispute, and they can arrange credit, bankruptcy or company checks to give you an idea of the likelihood of recovery, as well as offering bulk services for multiple customers.

A letter before action is a simple instruction to the debtor that you have sought legal advice and that you will issue more formal proceedings if the debt is not paid within an agreed

time frame. Depending on the type of debt, this cost effective action can be successful in up to three quarters of instances, and many firms are able to send such a letter on the same day you contact them. After this, you can then issue legal proceedings, which involves an application to the court and notice served to the debtor. Many cases are resolved at this stage, although because you are likely to also wish to claim for the costs incurred, many debtors will allow the case to go to a full hearing, which can result in a County Court Judgement. Obtaining a judgement is not necessarily the end of the matter, as the judgement must be enforced to recover your debt. Finding the right lawyer for this aspect is vital, as a range of recovery methods can be used, some tailored to recovery from a business.

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