When someone owes your small business money, you certainly feel like a victim. But did you know that if you aren't careful, you could break the law by trying to get the money back?
How to Break a Federal Debt Collection Law
You have a small business, and your bills are coming due soon. You could easily pay those bills if a few thousands dollars of overdue invoices were paid. It's time to give your clients a few friendly reminders:
1] You call up the biggest debtor at his home number. The debtor's girlfriend answers and you leave the message that you were just calling to remind her husband about the invoice you had sent last month.
2] You get into an argument over the phone with the next debtor. In the heat of the moment, you say you're referring the debt to you attorney--when in reality, you know you can't afford to do that.
3]It's getting late--in fact, it's already after 9pm. But you know that debtor number 3 tends to stay up quite late, so it's practically midday for him. So, you cheerfully give him a call and remind him about the invoice of a couple of months ago.
Congratulations, you may have just broken a federal law three separate times. Plus, you could be sued for it.
Collections Laws Finer Points
Have you figured out what collections law you broke yet? It's the Fair Debt Collections Practice Act (FDCPA), the federal law for collections. Meant to protect consumers from harassment, it has a clear list of things you can't do. Let's look at what you did wrong in the last example:
- Never tell someone other than the debtor that you are calling about a bill. You can, of course, leave a message that you called. You can even call someone simply to find out if they know if a hard-to-reach debtor has moved house. But you cannot under any circumstances let on that they owe money. Simply leave your name and phone number as with any other "call me back" telephone message.
-Never claim to be involving an attorney when you are not. Of course, this might seem like a soft area of the law, since intentions are fuzzy. But, for instance, if it's clear that suing to recover the debt would cost as much as the debt itself, your bluff will be obvious in retrospect. To be on the safe side, don't ever claim to have involved your lawyer.
-Never call before 8 am or after 9 pm, unless you have the explicit permission of the debtor. But unless that permission is in writing, you're safer not calling during those hours, anyway. Of course, it's not strictly this simple.
For instance, the law is only supposed to apply to consumer collections, not business collections. But with home business and telecommuting blurring the line between work and home, you're better off following the law's dictates in every case.
Plus, the law has numerous other protections for debtors--or traps for collectors, depending on your point of view. This is just one reason why you might want to outsource your over-aged accounts receivables to a professional service.
If you want to learn collection laws, then visit collection laws for the latest information on debt collection laws and collection agency regulation.
efficient cleaning crew Northbrook ..As you may already know, asphalt paved parking lots do... Read More
If you are a non-operator owner of many work trucks,... Read More
We are noticing an increase in the length of time... Read More
Why Alliances FailWhen do you know an alliance is falling... Read More
You are selling your small business (business value under $1... Read More
Top 3 Ways to Maximize Your Small Business Server Consulting... Read More
There were only an estimated 1800 active franchisors in this... Read More
Business card size works well for invitations to special events.What... Read More
If you interviewed business owners of failed businesses, a majority... Read More
All franchises must meet the legal definition of a franchise... Read More
One of the biggest excuses franchisees of home based and... Read More
You've heard it before; we're living in an information age.... Read More
1. Look Over Your Shoulder ? Of course, Punxsutawney Phil... Read More
You've heard marketing and advertising gurus quip, "Sell the sizzle,... Read More
We very much like what we see in Lubbock, TX... Read More
The challenges of the small business owner are well documented.... Read More
A recent survey indicated that clean Taxi Cabs Fleets have... Read More
When you feel like you're always busy working on your... Read More
No, I'm not talking about gambling or dairy cows ?... Read More
Company mottos can easily be printed on a business card.Sometimes... Read More
As you reflect on this year and prepare for next... Read More
By outsourcing to skilled professionals you'll be able to grow... Read More
Here are some sound debt collection techniques that can be... Read More
Writing a business plan is a fundamental step to ensuring... Read More
You're pretty proud of yourself! After all, only four months... Read More
cleaning lady near Wilmette ..We're birds of a feather, public relations and small business.... Read More
One overlooked individual in the process of taking a company... Read More
The current lack of industry leaders represents an exceptional opportunity... Read More
Don't you find that there are so many decisions you... Read More
One of the biggest fears people have about starting a... Read More
Often smart entrepreneurs look for out of the way businesses,... Read More
Starting and growing a small business can be a daunting... Read More
In many industries, image is one of the last things... Read More
Expanding your business requires you to take a good hard... Read More
One of the first things you will need to set... Read More
If a customer owes your local business money, it's hard... Read More
There is much competition in the mobile auto detailing business.... Read More
Should you buy a business opportunity or Franchise if you... Read More
Ask anyone trapped in a cubical about their entrepreneurial dream... Read More
The challenges of the small business owner are well documented.... Read More
Small businesses need Public Relations, possibly more than large corporations,... Read More
When should you create a foundation in order to solidify... Read More
At first blush this idea might be difficult to wrap... Read More
When we speak of branding most of the time people... Read More
More sales and more profit. Isn't that what you want... Read More
It's a strange anomaly.Most people who set out to start... Read More
Writing a business plan is a fundamental step to ensuring... Read More
The following are six essential skills to business success. You... Read More
Sacred cows take a long time to die. We get... Read More
When small businesses fail, the wreckage is often assigned to... Read More
Small Business |