When customers fail to pay their bills or debts to businesses, these businesses have the right to pursue the money owed to them. Various tools and remedies are available to business owners to recover their payments. The most appropriate one to choose depends heavily on the circumstances of the debt and the relationship between the business and the delinquent party.
For help collecting a business debt, contact the Weisblatt Law Firm today at (713) 666-1981.
“Self-Help” Remedies and Collection Agencies
“Self-help” remedies involve the creditor taking matters into their own hands to recover the debt. This is first typically done by communicating a demand for payment directly to the customer. If the customer fails to pay, the business owner will likely eventually involve a debt collection business. Although debt collection agencies can be effective, creditors must be aware of the percentages they charge.
Secured Transactions
Depending on the terms of the debt owed to you, you may have the authority to seize collateral when a business debt goes unpaid. If the debt was issued based on a secured transaction, you may be entitled to seize the collateral used in the deal. Often, real estate is used in secured transactions, in which case a borrower could lose property upon becoming delinquent.
Court-Based Remedies
Looking to the Courts
As a creditor, you have the right to take legal action for a business debt. However, you may be subject to court costs and attorney’s fees. Some of the remedies the judicial system may offer you include:
Seize Debtor’s Property
In cases involving emergencies, the creditor may be able to seize the debtor’s property even before the court decides the matter. These are extraordinary measures.
Replevin
Replevin is the right of a legal owner of a piece of property to take steps to recover that property from someone who holds it unlawfully.
Attachment
In an attachment proceeding, there is usually a court hearing, after which the court issues an order authorizing the creditor to take the debtor’s property or title to the property. Like replevin, attachment is available in only extraordinary cases, such as when the debtor is about to dispose of the property.
Lawsuits and Liens
In addition to court-based remedies, there are other legal courses you can take to recover property or payment as a creditor.
Lawsuit:
Creditors can sue debtors directly in court. Upon receipt of a judgment in its favor, the business can seek the appropriate remedies and relief. If the debtor does not appear in court, the judge will rule in favor of the creditor.
Lien:
Judgment liens can arise if a creditor goes to court to collect on a debt and proves its case, or the debtor fails to contest the matter. The court will order a judgment in the creditor’s favor in the amount owed to it by the debtor, and the creditor then has a lien against the debtor’s property in the amount of the judgment.
The Weisblatt Law Firm fights hard to accomplish your goals.
What Are Your Rights as a Creditor When Your Business Is Owed a Debt?
Understanding Your Rights
Collecting unpaid debts is essential to the success of any business. Texas attorney Andrew Weisblatt is a skilled Houston B2B business collections attorney who understands how to effectively collect from businesses that may be reluctant or unable to pay their outstanding financial obligations.
To learn about your rights, schedule an appointment with Mr. Weisblatt by calling our Houston office today at (713) 666-1981.
Attorney Andrew Weisblatt
Mr. Weisblatt has practiced continuously since becoming licensed in 1992 and has represented businesses ranging in size from one person start-up ventures to multi-national corporations employing hundreds of people in multiple countries. From 2005 through 2009 Mr. Weisblatt was in-house counsel and chief operating officer of a multi-national corporation in the steel products industry. That in-house position provided valuable insight into how businesses work and what they actually need from their lawyers – both in-house and outside counsel. Attorney Bio
