Commercial Debt Recovery

Commercial Debt Recovery

FreeDebt Recovery's Solution

FreeDebt Recovery will ensure that the debt is collected and that your business does not suffer because of another business’s poor administration or financial problems.
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Debt Recovery Process

We work with businesses of all sizes from all sectors, many of whom use our services on a regular basis and consider us their debt recovery partner.
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FreeDebt Recovery's System

The most important aspect of debt recovery is to take action promptly and decisively. The longer a debt is left, the worse the situation will become.
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Commercial Debt Recovery

Even the best-managed businesses will, from time to time experience difficulty in getting in all the monies due to them. For most businesses, cash flow is their lifeblood, and any interruption to that flow, especially for new or growing businesses, can cause serious problems. 

No one wants to take on more debt, either in the form of a loan from their bank or credit card to cover debt just because someone else is not managing their business properly and not paying what is due.

While we can all appreciate that there can occasionally be reasons for non-payment, it is all too often that your customer is experiencing cash flow problems themselves. One of the major difficulties with debt is the way in which it can impact on a whole chain of businesses, one company not paying a bill can set up a reaction similar to a line of dominoes. Then there are always a few awkward clients who choose either not pay until the very last minute or try to avoid paying up at all.

Whatever the “reason” FreeDebt Recovery will explain the seriousness of the situation to your debtor, that you are determined to recover the money that they owe, and further that consequences for their own business will result from non-payment of their debt to you.

THE PROBLEM; LATE, SLOW AND NON-PAYERS

The Solution; FreeDebt Recovery

FreeDebt Recovery's Solution

The Government introduced the Late Payment of Commercial Debts Act with two aims. Firstly, to compensate creditors for the late payment of debts. Secondly, to deter late payment. It only applies to the commercial supply of goods and services where there isn’t a provision for interest in the Terms of Business.

In brief, for invoices that are not paid on time, it enables you to claim interest, compensation and (for orders placed after 16 March 2013) your reasonable costs of collecting the debt where these exceed the compensation. 

Chasing poor payers takes time away from doing what you do best, running your business, and costs both time and money. It isn’t a pleasant task or one that business owners relish, so tends to be put off until the debt is very overdue. Taking prompt and decisive action by handing the whole file over to B2B debt collection specialists, FreeDebt Recovery, takes an unpleasant task off your desk, and quite simply and professionally, gets in the money owed to you in full.

Prompt action is vital when recovering commercial debt because if your debtor is not paying you there are likely other creditors who are less tolerant and who will take action with the result that their debt then takes priority over yours.

When you instruct FreeDebt Recovery, you will find that we are as good as our word with no hidden charges. Our service is risk-free and in the unlikely event that we are unsuccessful in recovering the money you are owed there is no charge whatsoever

We work with businesses of all sizes from all sectors, many of whom use our services on a regular basis and consider us their debt recovery partner.

We will work to recover any commercial debt of over £500 and recover 90% of the debts we are asked to recover without recourse to legal action

INSTRUCT US

Submit a debt or call us on  0800 032 5092

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Debt Recovery Process

Over the years we have found that successful B2B debt recovery requires a flexible approach, there is no one size fits all. Each individual debtor will have their own reasons for non-payment, our expert case managers will be sympathetic yet firm, leaving each debtor in no doubt that the bill must be paid.

Our case managers bring vast experience, patience and determination to negotiations, and will explain the provisions of the Late Payment legislation when necessary, to deliver an effective, and professional recovery.

The most important aspect of debt recovery is to take action promptly and decisively. The longer a debt is left the worse the situation will become, debtors tend to bury their heads in the sand and put off dealing with demands for payment. We find that by speaking to them directly and explaining the legislation that they can be brought to realise that they need to pay the debt without any further delay.

FreeDebt Recovery's System

The client makes an initial contact, fills out our online form and sends us the invoice or invoices and a copy of any paperwork relating to the case which they wish us to action.


We carry out our initial investigations to establish the debtor’s financial position, current trading status, location and property ownership. 


We contact the debtor in writing with an initial letter of demand requesting payment of the outstanding debt within 7 days. The letter will detail the debt, the amount owed, and show the late payment interest and compensation calculations as allowed by the Act.


The interest and compensation will cover our costs up to this point. When investigations have been particularly complex and time-consuming recovery costs will also be added to the debt.


Our initial demand letter meets debt recovery litigation protocol and advises the debtor that a specialist B2B debt recovery practitioner has been instructed and that further proceedings and charges will be instituted unless payment is made.


This letter often finally makes the debtor aware that the situation is serious and in the vast majority of cases results in a successful recovery. If the debt has not been settled with 7 days we will issue a final demand letter, formally giving 7 days notice of legal action, to comply with the legal protocol. detailing the costs that are being incurred under the legislation through delaying their payment, and the consequences of a statutory demand or court judgment against them.


If no response is received within 7 days debt recovery litigation protocol can be considered to have been completed and formal legal action can be taken. However, during this period we will also attempt to make contact with the debtor by telephone at their home and place of business. 


When one of our professional case managers makes contact with the debtor by telephone the matter can usually be brought to a successful conclusion, there is something about a personal one to one contact that brings the seriousness of the matter home to the debtor.


A conversation with the debtor can be is also useful in establishing further details that may be part of the case against them. We find that very often we can establish the grounds for non-payment and resolve them, sometimes in the case of hardship, and with the agreement of the creditor, by agreeing to a payment plan. It also helps us to identify cases where the debt is genuinely disputed and litigation may not be appropriate.


We will by now have made more detailed enquiries as to the financial position of the debtor’s business possibly by making a visit to their premises. We have found that a visit from our experienced case managers can provide a valuable insight into the financial position of the business and the businesses’ assets.


Visiting a debtor at their premises also allows us a final opportunity to explain the consequences of a court judgment against them and often leads to immediate payment. 


A visit to the debtor’s premises has been found to be very successful in finally achieving payment from even the most reluctant. 


Although, if at this stage we have been unsuccessful in recovering the debt we may, with the client’s agreement, issue legal proceedings.


However, legal proceedings are not always necessary or entirely effective. There are other enforcement methods businesses may choose to explore. A credible alternative is the threat of insolvency action under the Insolvency Act 1986 for undisputed debts over £500 which can provide a cost-effective and low-risk solution. Under the legislation, a limited company is deemed insolvent if it is proved, to the court’s satisfaction, that it is unable to pay its debts as they fall due. 


By serving a correctly worded 72 hour winding up a notice on its debtors, who cannot pay within that time period, the creditor is entitled to present a formal winding up petition to effectively close the company down. In respect of non-limited businesses, partnerships and sole traders, the personal service of a Statutory Demand under the same Act gives the debtor 21 days to pay in full or face individual bankruptcy proceedings.

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