What are your options when someone won’t pay your business?
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What are your options when someone won’t pay your business?

| Sep 1, 2020 | Debt Collection |

Running a business means offering goods or services that other people pay for. Unfortunately, most businesses will eventually encounter someone who resents the obligation to pay for the goods or services they have already received.

When someone refuses to pay you, you have the right to pursue collection activity against someone who owes your business money. There are several ways that you can do this.

When companies sell their debt, they often lose out on the value

The quickest and easiest way to get a red mark off your ledger is to sell the debt to a private collection company. The problem with doing that is that the company will probably only pay a few cents on the dollar for the debt an individual owes you.

If they are able to collect the full amount, you will not see the remaining balance. You lose out on the value when you trade the outstanding debt for an upfront payment.

You may be able to take the other party to court

Depending on the circumstances, there are several ways in which the Kentucky courts could help compel the other party to pay you. If your company did work on a property, you may be able to request a lien against that property until you get paid in full for the services or materials provided.

For most other situations, the company seeking payment can likely file a civil lawsuit against the party who owes money and specifically request a garnishment of their wages. The courts could take money out of their paycheck to repay you, helping you avoid the issue of them refusing payment.

Getting legal help with debt collection is often necessary. Small mistakes could leave you vulnerable to action by the other party over fair debt collection practices.