Debt Settlement for Small Business Collection Claims in Canada
There are situations where settling a business debt for less than the original amount owed makes sense for both parties. Working with a collection lawyer can help.
Types of Debtors
The first step in determining whether you should offer a lower payment to settle a business debt is to identify which type of debtor you’re dealing with. There are different categories of debtors that may apply.
- A customer that will do anything to avoid paying the debt.
- A customer that owes several debts and pays sporadically.
- A customer that typically pays on time but is having financial trouble.
Settlement strategy may change for each type of debtor as well as other factors such as the nature of the relationship and the amount of the debt owed. Rather than stress and guess, join LegalShield and a provider lawyer can advise you on the best course of action.
How Much Should You Settle For?
If you decide that settling for less than you’re owed is a good option, you need to think about the amount you would be willing to accept. There are several factors that you can weigh.
- Do they owe you for a physical product or services? Have you fully delivered?
- What were the hard costs to deliver the product or service?
- What is the nature of your relationship with the debtor? Do you want it to continue?
Every situation is different and it’s wise to consult with a lawyer related to debt settlement. Also, with a LegalShield membership, you can have a provider lawyer draft the appropriate settlement paperwork under the 25% discount from their hourly rate for business matters, once you’ve come to an agreement.
Plans Start at Only $49 Per Month.
Key Features of Our Small Business Legal Plans
LegalShield’s business plans can help you in the following areas.
Legal consultation from a provider lawyer on business legal matters, with legal research for each issue, if needed.
Receive help with business legal matters more efficiently with professional communications issued on your behalf.
Put business-related legal documents through legal review.
A collection letter from a provider lawyer could help you recoup payments more efficiently.