Someone Owes Me Money – What Should I Do?
Someone Owes Me Money – What Should I Do?
There are many reasons why someone would owe you money. In the case of a private individual, this could be money lent to a friend or family member to help them with something.
In business terms, there are also different reasons why someone would owe you money. It may be as simple as a client who has not paid their bills or invoices. It could also be that a supplier has not reimbursed you for goods or services which were not received.
In any case, if you are asking yourself ‘what do I do if someone owes me money?’. If so then it’s time to learn what the options are for collecting on your debt.
Our team of industry-leading debt collection experts have listed some pieces of free advice which are designed to help every business in the UK recover and claim back their unpaid debts.
What To Do If Someone Owes You Money
If you are a UK based company that is owed money by anyone, be that a client or another business, then there are several key points of information you should know.
Firstly, it is important to consider the options available to you. In brief, they are:
- Abandon the debt
- Attempt to collect the debt independently
- Instruct a professional debt collection agency
Now that the options are known, it is important to consider what each one will mean for you and your business, and which choice is best.
In the case of the first option, it may seem like the worst decision, and in many ways it is. Ignoring debt guarantees that your money WILL NOT be recovered.
There are reasons why a business owner may simply abandon a debt. Perhaps it is an important client they don’t want to confront (and risk damaging their relationship). It may be they simply do not have the time or means to pursue the debt.
In any case, despite initial perceptions, there are always better options than this and any amount of owed money should not be ignored.
It is not advised to ever simply abandon a debt. If there are concerns remember – no business has ever lost a client simply because they were asked to rightfully pay.
Independently Recovering A Debt – Pros and Cons
“I have money owed to me, I’ll try collecting the debt myself!”, is something that many business owners say to themselves every day.
Attempting to collect a debt independently is definitely an option. It is one which many business owners across the UK choose to do as soon as they begin to gain debts that are owed to them.
Whilst initially a promising choice, there are many downsides to going down this path. For instance, when collecting a debt independently, the resources and time of at least one or more company staff members are taken up with the recovery task.
This means that the debt begins to cost even more money right away, and as well as this, there is no solid guarantee that the debt can actually be recovered.
Alongside this, the time taken to collect a debt can be too costly and ultimately the rest of the business begins to suffer. This is because value-based activities which help to grow the company are not being performed.
Quite often, the relationship between the debtor and the business can become damaged during this process. If handled incorrectly, potential future sales opportunities can be lost forever.
How Do I Find Someone Who Owes Me Money?
The act of finding someone who owes you money is also a concern and can be a particular headache for those who have debtors that vanish without a trace. In these situations, time and money will need to be spent tracking them down – at more cost to you.
Complications can arise if the debt is owed from someone overseas. For someone without specialist knowledge of any nation’s unique debt collection laws, things can become complex and costly very quickly.
Lastly, if the case eventually requires involving the court, then costs can increase again. This makes the recovery of the debt potentially even more costly than that of the money which is owed to you.
If this happens, then the time and money spent so far could have been wasted, impacting the business even more.
Whilst many businesses are sometimes successful when recovering a debt independently, the cost often far outweighs the rewards.
It is important to remember that there are better options that have a drastically higher likelihood of a successful recovery combined with a dramatically lower cost.
What Do I Do If Someone Owes Me Money? Instruct A Debt Collection Agency!
By far the best option on this list is to instruct a professional debt collection agency to perform the recovery process on your behalf. An agency will provide a clear picture whilst applying their expertise to collect your debt in as timely a manner as possible.
Choosing the right debt collection agency for you is a big subject, and we recommend reading the guides our experts have prepared to help with this.
Federal Management is the UK’s leaders for commercial debt collection, so we will now focus on why choosing them to recover your owed money is the best choice.
A professional debt collection agency will be able to recover your debt in the quickest and most cost-effective way possible. As well as this, you have the best chances of recovering money owed to you when compared to the other options in this guide.
Federal Management provides a free appraisal reflecting the viability of your debt’s recovery. This means from the first stage you will know whether your debt can be recovered.
In some cases, a debt simply cannot be collected (for reasons such as a lack of proof, necessary documentation. Perhaps the company has dissolved), and knowing this at the beginning can save a lot of wasted time and hope.
As soon as the debt collection agency is instructed, your own company staff will be free to focus on value-based tasks which grow your business. This will allow you to operate as normal whilst the recovery process takes place.
In the case of Federal Management, all communications with the debtor are handled in the most sensitive and professional manner possible. Our clients have constant access to all communications between us and the debtor.
The outcome of this is that business relationships between the client and debtor will not be jeopardised, leaving future business opportunities open.
Tracing the debtor will not be an issue, as a professional agency has the resources to find them regardless of location. For any international debt collection, Federal Management has a trusted network of global agents. Each one is an expert in the collection process of each of their respective nations.
Court costs may not even be necessary, as a debt collection agency usually achieves a result well before this step is necessary. It is important to note the difference between a debt collection agency and a solicitor who specialises in debt recovery.
The latter will tend to gravitate towards long, drawn-out court processes which may add up to more expense in the long run.
Ultimately, instructing a debt collection agency like Federal Management is the best option when someone owes you money. Their ability to collect any commercial debt in a completely professional and low-cost manner means that instructing them is the option with the best outcomes for you and your business.
Someone Owes Me Money, What Should I Do? Frequently Asked Questions
Do You Just Deal With B2B Debt Collection?
We are the UK’s leading Business Debt Collection specialists but can also help with Personal Debt Recovery
What Is Your Recovery Rate?
We collect as much as 90% on undisputed Business debts.
What Are Your Commission Rates?
Our Commission rates start from as little as 6% upwards dependant on the value, volume and complexity of the debts.
Are You A Professional Company?
Yes, we are a Multi Award Winning FCA Regulated Company that has operated since 2004
Do You Have A Minimum Debt Value You Will Act On?
It depends on the nature of the debt. Normally £500+ but we can usually help or give advice for smaller amounts.
A Foreign Customer Owes Us Money, Can You Help?
Yes, we have a network of trusted, accredited Debt Collection partners around the world and have recovered millions for our clients.