Customers who are past due on their accounts is one of the most difficult situations to deal with.Asking for payment in a firm manner is delicate, but can be accomplished.You should let the customer know how much is due and how to pay.You should send additional letters if the customer doesn't pay by the deadline.A first notice, a firm reminder, and a final demand are the letters.
Step 1: Write your letter in a format that is easy to read.
It's a good idea to set your letter up like a business letter.The Times New Roman 12 point works for most readers.The date that you are sending the letter is important.You need to include your business address at the top if you don't use company letterhead.
Step 2: Request money.
The first day that payment is due, you should mail out a reminder.A friendly tone is what you want to use.The customer may have forgotten that a check is in the mail or that payment is due.The customer should be given a deadline to pay.The payment on your account was due on April 12th.We haven't received payment yet.You might be willing to offer a payment plan if you submit your payment within seven days.Mention that in the letter if it's true.You can accept half of the amount due this month and the other half a month later.
Step 3: Payment methods that are acceptable are identified.
You do not want the customer to use a method that you don't accept.If you want to protect yourself, explicitly state what payment methods you accept.If credit card payment is an option, include lines at the bottom of your letter for the card number, expiration date, cardholder name, signature, and the amount to be charged.You could write that you can pay by check or money order.We accept payment with Visa, Master Card, or American Express as a courtesy to our clients.If you choose to pay your balance with a credit card, complete the form at the bottom, sign, and return the letter to our office.You can call to set up credit card payment.
Step 4: The letter should be stopped.
The customer should be told what you have included.If payment has already been made, make sure to ignore the letter.If you don't have a phone number or email address, you should give that information as well.You can write, "I have enclosed a copy of the invoice I sent."You can use the stamped envelope.Remember to sign your letter if you have already sent your payment.Also include your title.
Step 5: The customer will receive the notice.
You can email the letter or mail it.It is best to send a return receipt if you send by mail.The customer has received your reminder.You should include any enclosures, such as a copy of the invoice or an envelope.Attachments should be sent as PDF if you send the notice by email.
Step 6: Let the customer know that they are late.
Use the same format for the second letter.You have already sent a notice, but haven't heard anything.Late fees, charges, or interest should be mentioned.The tone should be serious.Your first reminder was friendly, but now you need to be serious.You can write, "As of today, we have not yet received payment from you, although we sent you notice on April 13."Your account is late.We haven't applied late payment or interest charges yet.
Step 7: Provide another deadline.
The customer should be given another seven days to pay.If they don't pay up, be warned of consequences.Late fees or other charges can be added.You can use the same language that you used in your first notice to remind the customer of your payment methods.
Step 8: The letter should be stopped.
The customer can be told what will happen if they don't pay.If someone is late with their payments, you might have a policy of no longer doing business with them.You could write "We have a policy of refusing service to any individual who has an account more than 14 days late."We are confident that it will not be necessary for you to stop doing business.If you have already sent payment, please ignore this letter.You can mail it certified mail and get a return receipt.You should always keep a copy of your records.
Step 9: Make sure to identify the letter as your final demand.
The letter should be a standard business letter.Put the words in bold and underline them if you want to include a heading.You want the recipient to know that this is their last chance to make a payment.
Step 10: Explain the late fees.
You should tell the customer that they are in violation of your agreement and that you have added interest or a penalty for being late.Tell them how much they need to pay.Your account remains delinquent despite previous reminders.Due to you being in violation of our payment terms, we are adding a $50 late payment penalty per our Late Payment of Debts Terms of Agreement.
Step 11: Give a time limit.
The customer should be told how long they have to make the final payment.You shouldn't give them too much time.You can set a deadline of 72 hours.If the customer doesn't meet the deadline, what will happen?You can pass the account onto collections or take the customer to court.It is important that you pay your bill in full within 72 hours.If you don't, we will have little choice but to pass this account to our debt collection agency, who will add more charges to the account.
Step 12: Don't reply to the letter.
The client should pay up if they don't take the final demand letter seriously.You could write, "We suggest that you take this matter seriously and pay your balance in full as soon as possible."
Step 13: The letter needs to be delivered.
You should use certified mail to send this one.If you don't hear back from the customer, then you can either send the account to collections or file a lawsuit.