Unpaid commercial debts and chasing after debtors can take a tremendous toll on your business in both time and money. The first step in collecting a debt is often sending a demand letter. The commercial collections lawyers at Klapper & Fass can help creditors in New York and nationwide assert their rights in pursuing the money that they are due. We can use skillful negotiation, sound strategies, and aggressive litigation tactics in our efforts on your behalf.The Contents of a Demand Letter
The Uniform Commercial Code has largely been adopted in New York, and it governs commercial accounts involving the sale of goods or services that are valued at more than $500. Under U.C.C. § 2–725, you must bring a debt collection lawsuit for breach of a sales contract within four years of accruing the cause of action. Other types of debt may have different statutes of limitations. The time period starts running as soon as the breach happens, not when you realize that you are not getting paid. Therefore, it is critical to send your demand letters and initiate efforts to collect the debt long before the four years expire, preferably as soon as you realize the debtor is not planning to pay.
Even before sending a demand letter, we will have to track the debtor to make sure that the demand letter and any subsequent filings are served at the proper address. It can be useful in some cases to find out whether the business has filed for bankruptcy or whether the individual responsible for the debts has nonexempt assets that are collectible. To learn this information, we may do asset locating and skip tracing.
Notice of default must be given to a debtor when you are relying on contracts, promissory notes, or other documents that specify that notice is to be given. However, even in cases where it may not be strictly required, you should put a debtor on notice by sending a demand letter so that you have one last opportunity to collect the amounts you are due before incurring the expenses of litigation. Notice also ensures the debtor will be aware that it will be responsible for any additional interest or attorneys' fees that may be specified in the agreement that created the debt.
When sending a demand letter, we include information such as the names of the parties, the nature and amount of the debt, any additional fees incurred based on the agreement, and the next action to be taken if there is no response. It may be appropriate to send a statement of account with the demand letter to show the total outstanding balance that is due.
In some cases, a demand letter can lead to a debtor agreeing to a written payment plan in order to avoid litigation. The debtor may agree to a consent judgment clause in the payment plan that allows you to immediately enter a judgment against the debtor, which cuts down on the time and expense of filing a traditional lawsuit.Pursue a Commercial Debt by Enlisting a New York Lawyer
The creditors’ rights attorneys at Klapper & Fass can seek the money your business is owed from debtors in New York and throughout the United States. Many of our clients have come from Westchester, Suffolk, and Nassau Counties, as well as throughout the five boroughs of New York City. Contact us at 914-287-6466 or via our online form.