Skip to content

Past Due Accounts: 5 Best Ways to Collect

Past due accounts can slow down your operations, creating cash flow problems and making it more difficult to pay for inventory, wages, production, and other operational expenses. And having to fight tooth-and-nail to collect adds even more stress to you as a business owner.

It’s an extremely difficult hardship and one that contributes to the 82 percent of businesses that fail due to cash management problems. In this article, we’re going to help you avoid the muck by giving you our picks for the five best ways to collect without grinding your business to a halt.

1. Offer Options for Past Due Accounts

Try to work out a payment plan with the customer. This could involve breaking up the bill into smaller, more manageable payments. If the customer is uncooperative or unwilling to work out a payment plan, send them a final notice or demand letter giving them a specific amount of time to pay off the debt. If the customer still does not respond, contact a debt recovery service to help you collect.

2. Weigh Your Legal Options

Of course, you always have the option of taking the matter to court. Before doing so, consider the following factors:

  • How much money is owed?
  • Are you confident that the person owes you the money and that they have the ability to pay?
  • Is the debt well-documented?
  • Do you have their agreement to repay the debt in writing?
  • Do you have proof that your end of the transaction was upheld?
  • Is the amount worth pursuing legally, or would it all be drained in legal fees?

You should also consider whether or not you have a good working relationship with the person. If you do, don’t give that up easily. Be willing to negotiate as much as you can. However, if the person is ignoring your attempts or stonewalling, stand up for your rights.

Viable legal options may include garnishing the customer’s wages. For this, you will need a court order. Similarly, a court order can help you seize the customer’s assets, such as their bank account or property.

3. Turn Over Debt to Collection Agency

Another option is to turn over the past due accounts to a collection agency or sell it to a third-party lender.

You will need to compile all of the pertinent information about the debt, including the amount owed, the date it was incurred, and the contact information for the debtor. Then, you will need to find a reputable third-party lender who is willing to purchase the debt.

Selling a debt could leave a negative impression on the debtor if a third-party company violates any laws or gets overly aggressive in its tactics. Vet the company’s reputation thoroughly if going this route. You can collect on what you’re owed without making lifelong enemies.

This is one of the things that has helped Southwest Recovery Services over the years. We’ve been committed to getting our customers paid quickly and responsibly. We do this through adherence to the Fair Debt Collection Practices Act and the Fair Credit Reporting Act. You can read more about our standards here.

4. Send Account to Credit Reporting Agency

You can also send the account to a credit reporting agency, which will damage the customer’s credit score.

You’re certainly within your rights to report unpaid debt to a credit bureau. If the customer wants to repair their credit (and it’s likely they will if they wish to buy a home or car), they’ll pay the debt at some point.

On the other hand, reporting the debt can do long-term damage to the debtor’s credit report and may make them less likely to pay. It’s best to first exhaust every option of collecting or settling the debt before resorting to this option.

5. Negotiate a Settlement

Finally, you can always try to negotiate a settlement with the customer.

In this scenario, they would agree to pay off the debt for less than what is owed. This is known as a “pay for delete” agreement. It’s definitely not ideal, and going it alone will almost certainly result in shortchanging yourself.

A better option is to use a debt recovery service. This keeps the emotions and susceptibility to manipulation out of it. You show the debtor that you mean business while also exercising enough leniency to motivate them to action.

Furthermore, a debt recovery service will likely be able to get a higher percentage of what is owed than you could on your own. After all, your first devotion is to the operations of your business, not acting as a full-time collection agency.

Do You Have Any (Way) Past Due Accounts?

If so, it’s time to take action. You can do it without being the “bad guy” and without putting your business’s reputation at risk. That’s where Southwest Recovery Services comes to the rescue. We have many years of experience using a combination of legal assertiveness and know how to get debtors to pay businesses and lenders what they’re rightfully owed. Contact us today to get started.

Have A Question?

Get In Touch

Southwest Recovery Services is a national collection agency with offices in Texas, Oklahoma, Missouri, Ohio, Florida and Georgia.

Payment Processing

  • Online Payment Terms and Conditions

    Welcome to the Southwest Recovery Services LLC payment processing site. Please read and agree to the following online payment terms and conditions, website Terms of Service, and Refund Policy prior to agreeing and completing your online payment.

    *** NOTICE ***

    This is an attempt to collect a debt and any information obtained will be used for that purpose. This communication is from a debt collector. If you have any questions or would like to talk to a live Collections Specialist, please call us at (866) 558-3328 during standard business hours: Monday thru Friday 8am-6pm CST. You can also mail your payment directly to Southwest Recovery Services LLC, 16200 Addison Road Suite 260, AddisonTX 75001.

    Credit Card Transaction

    By submitting payment information through this Service you agree to the terms and conditions of this Agreement and any documents incorporated by reference. You further agree that this User Agreement forms a legally binding contract between you and Southwest Recovery Services Inc. and that this Agreement constitutes "a writing signed by You" under any applicable law or regulation. Any rights not expressly granted herein are reserved by Southwest Recovery Services Inc.. By clicking on the "I Agree" button and by clicking on the “click here to pay by credit card” button, you are accepting these terms and the stated fees for using this service.

    IMPORTANT:  Please make sure that you have correctly inputted your account number and creditor’s name in the payment form. This information can be found on your bill. For assistance, please contact us at (866) 558-3328. 

    This site provides a secure payment portal for making online payments. Please ensure that you are paying the correct party and that you have a valid account number received from us.

    If you do not know your account number, please do not make a payment through this web site at this time. Instead, please Contact Us to obtain your account number before returning to make the payment. Without the account number we cannot credit your account with the payment you make on this site, which would result in a significant delay in processing of your payment.

    • This is a web site of a collection agency.
    • This is an attempt to collect a debt.
    • Any information obtained will be used for that purpose.

    Question? Contact Us: info@swrecovery.com

Make A Payment