You want quick resolution of delinquent accounts. A well-organized paper trail that includes pertinent customer information and documentation will ensure delays are avoided.
Why Do I Need Documents?
Your collection professional needs to be armed with basic information in order to communicate and demand money from your debtor. Proper documentation, forwarded right at the beginning of the collection process, allows your collector to effectively handle the claim on your behalf.
What Documents Do I Need?
Credit application or equivalent. This is the most crucial and should contain:
- Debtor’s full name and physical address (not a P.O. Box)
- Debtor’s legal identity, including whether it is a corporation, partnership or proprietorship
- Names and residential address of the owners or debtor
- Nature of the debtor’s business
- Debtor’s phone, fax and email
- Trade references including exact bank name and account number
- A properly worded credit application will include an agreement for the debtor to pay interest. Simply place a line following the debtor’s signature that states the credit information is accurate: “Below the line is an agreement to pay interest, which is signed separately from the verification of the credit information. Without a specific agreement to pay interest, we are limited to suing for the legal rate allowed in the state where suit is brought. Also, if a personal agreement is expected, it must be in writing as much as any granting of any security interest.”
- Purchase Orders
- Proof of Deliveries
- Personal Guarantee
- Promissory Note