There’s nothing worse than loaning money to someone that doesn’t want to pay you back. When you do something out of the kindness of your own heart to help another one, it can be very upsetting when you see them throwing it all back in your face. Not only does it weigh on your finances, but you’ve also got to deal with the emotional consequences. Depending on the amount of money you’re owed, you might never want to help anyone out in the future. If you’re serious about trying to collect a bad debt, there are certainly things you can do to get the process underway. The world isn’t over once you try to collect a bad debt, but you might experience some difficulties along the way. Even still, you deserve compensation and you should get it back however you can manage it!
Try To Separate Your Personal Feelings
Whenever you get into a situation that involves money you’re owed, the person that owes you will do whatever they can to get out of paying it back. Whether they complain about losing a job or just not having it, they’ll try to do anything to make you feel guilty for asking for the money. They might even get bold enough to blame you! Whatever the case, don’t let it stop you from trying to collect a bad debt. In this case, it will be most important for you to keep any contact with them on a business level. Don’t engage in personal conversation that will make you upset. If you’re able to keep your feelings out of the equation, you’ll see how much more successful you can be. To let the borrower know how serious you are, you should be prepared to take any measures to get your money back: no matter if you have to tarnish their credit report or take them to a court of law.
Have Your Evidence Ready to Go
It’s important to get any kind of serious agreements down in writing but so long as you and the borrower had a thorough understanding that you would loan the money and they would pay back as soon as possible, you have a binding contract. If you don’t have an agreement that’s been cemented in writing, you can gather all of the information that was shared between you and the borrower regarding the money they owe you. Having all of the emails and letters you shared is a great idea and it will be all the better for proving your case. As long as these pieces of documentation detail when and at least how the borrower planned to pay you back, it should be easier to collect a bad debt.
Give the Borrower a Serious Warning
No matter if you’ve got the correct documentation or not, you should send the borrower a letter that’s been registered and demand that they pay you back. Your letter should touch upon the terms that you all agreed on. Remind them of the date you all came to this agreement, how much they should pay you back and when you expect the first payment to be made out to you. If they consented to paying interest charges, you should be sure to remind them of this information. It’s your responsibility to upfront and clear about what you want and when you expect to have it. By this point, the borrower had enough time to make good on their loan and they haven’t: you don’t owe them any further kindness.
Get Some Professional Help
If you don’t get a favorable response or payment within two weeks or less, it’s up to you to take further action. Don’t let your borrower get off easy without paying the price! Get a lawyer to have your back through the process. If your lawyer were to send a letter over to your borrower, you can bet that they would take it a lot seriously very quick. Hiring a lawyer will not be cheap in most instances but if you’re owed a lot of money, it definitely wouldn’t hurt to have the assistance of a talented lawyer on your side. The letter from your lawyer to your borrower is certain to send shock waves into their head. Your lawyer will most certainly be flowery and exact in their language and they’ll most likely remind your borrower of the trouble coming their way if they don’t cooperate. If you’re not totally confident in your ability to collect a bad debt on your own, your lawyer will be there to get you through the tough times with ease.
Do Whatever It Takes To Get It
If your borrower still seems unwilling to settle after all this, you’re more than ready to take your issues up with district, small claims or superior court. Small claims court is probably the best option since it’s the most inexpensive and a lawyer or attorney isn’t required.