Manufacturing companies often face challenges when it comes to collecting international debts. In this guide, we will explore a comprehensive Recovery System for Company Funds that can assist manufacturing companies in navigating the complexities of international debt collection. The system is divided into three phases, each with specific strategies and recommendations to help companies recover funds efficiently and effectively.
Key Takeaways
- Implementing a structured Recovery System can significantly improve the chances of collecting international debts.
- Thorough investigation of debtor’s assets is crucial in determining the likelihood of recovery.
- Consider the options of case closure or litigation based on the investigation results.
- Understand the costs and implications of legal action before proceeding with litigation.
- Tailored collection rates based on the number and age of claims can provide cost-effective solutions.
Recovery System for Company Funds
Phase One
Within the first 24 hours of initiating Phase One, a multi-pronged approach is deployed to secure company funds. Immediate action is taken to ensure that the debtor is aware of the outstanding debt and the urgency of the situation.
- A series of four letters is dispatched via US Mail, marking the commencement of the collection process.
- Concurrently, extensive skip-tracing and investigative efforts are undertaken to gather the most up-to-date financial and contact information on the debtors.
- Our dedicated collectors engage in persistent outreach, utilizing phone calls, emails, text messages, faxes, and other methods to negotiate a resolution.
Daily attempts to contact the debtor are standard during the initial 30 to 60 days. If these efforts do not yield a resolution, the case escalates to Phase Two, involving immediate referral to our affiliated attorneys within the debtor’s jurisdiction.
The goal is to achieve a swift and amicable resolution, minimizing the need for further legal action. However, should the need arise, the infrastructure is in place to advance the case efficiently to the subsequent phase.
Phase Two
Upon escalation to Phase Two, the case is transferred to a local attorney within our network. This shift signifies a more formal approach to debt recovery. The attorney’s immediate action includes drafting a series of demand letters on law firm letterhead, signaling the seriousness of the situation to the debtor.
The attorney’s involvement adds legal weight to the collection efforts, often prompting a more urgent response from the debtor.
Simultaneously, the attorney’s office begins persistent attempts to contact the debtor via phone. Despite these intensified efforts, if the debtor remains unresponsive, a strategic decision is required. The next steps are critical and hinge on the specific circumstances of the case. A detailed report outlining the issues and recommended actions will be prepared for your review.
Here is a brief overview of the potential costs associated with proceeding to litigation, should that be the recommended course of action:
| Legal Action | Upfront Costs |
|---|---|
| Court Costs | $600 – $700 |
These costs cover court fees, filing charges, and other related expenses. It’s important to note that these are preliminary expenses and do not guarantee a successful recovery of the debt.
Phase Three
Upon reaching Phase Three, the path forward becomes clear. If the debtor’s assets and case facts suggest low recovery odds, we advise case closure—no fees incurred. Conversely, should litigation seem viable, a decision point arises.
Litigation entails upfront costs, typically $600-$700, covering court and filing fees. These costs initiate legal proceedings to reclaim the full debt amount, including filing expenses. Should litigation not yield results, the case concludes without further charges.
Our fee structure is straightforward:
-
For 1-9 claims:
- Under 1 year old: 30%
- Over 1 year old: 40%
- Under $1000: 50%
- With attorney: 50%
-
For 10+ claims:
- Under 1 year old: 27%
- Over 1 year old: 35%
- Under $1000: 40%
- With attorney: 50%
Deciding against legal action? Withdraw at no cost, or opt for continued standard collection efforts. The choice is yours, ensuring flexibility and control over your company’s debt recovery strategy.
Frequently Asked Questions
What is the Recovery System for Company Funds?
The Recovery System for Company Funds consists of three phases aimed at recovering company funds through various methods such as sending letters, skip-tracing, contacting debtors, and legal action if necessary.
What happens in Phase One of the Recovery System?
In Phase One, the company sends letters to debtors, skip-traces and investigates debtors, contacts debtors for resolution, and if unsuccessful within 30 to 60 days, moves to Phase Two involving legal action.
What is the process in Phase Two of the Recovery System?
Phase Two involves forwarding the case to an affiliated attorney who sends demand letters to debtors, attempts to contact debtors, and if unsuccessful, provides recommendations for the next steps.
What are the options in Phase Three of the Recovery System?
In Phase Three, the company may recommend closing the case if recovery is unlikely or proceeding with litigation. Legal action requires upfront legal costs, and if unsuccessful, the case will be closed with no further fees.
What are the rates for collection services provided by the company?
The collection rates vary based on the number of claims submitted and the age and amount of the accounts. Rates range from 27% to 50% of the amount collected, depending on the specific circumstances.
What happens if the company fails to collect through litigation in Phase Three?
If the company’s attempts to collect via litigation fail in Phase Three, the case will be closed, and there will be no additional fees owed to the company or the affiliated attorney.
