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Effective Collection Post-Commercial Litigation

Effective collection post-commercial litigation is crucial for companies to recover funds owed to them. Having a robust recovery system in place can significantly increase the chances of successful debt collection. In this article, we will discuss a 3-phase Recovery System for Company Funds, outlining the key steps involved in the process and the key takeaways to keep in mind for effective post-commercial litigation collection strategies.

Key Takeaways

  • Implement a 3-phase Recovery System for Company Funds to streamline the debt collection process.
  • Utilize skip-tracing and investigation techniques to gather accurate debtor information for better contact and resolution.
  • Consider legal action if initial collection attempts are unsuccessful, with clear guidelines on the costs and procedures involved.
  • Understand the options available when recommending closure or litigation, including the associated costs and potential outcomes.
  • Be aware of the competitive collection rates offered based on the number and age of claims submitted, to optimize recovery efforts.

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 resolution. The process includes:

  • Sending the first of four letters via US Mail.
  • Conducting skip-tracing and investigations to gather optimal financial and contact information.
  • Engaging in persistent communication efforts, including phone calls, emails, text messages, and faxes.

Daily attempts are made to contact the debtor, with the aim to settle the matter swiftly. If these efforts do not yield results within 30 to 60 days, the case escalates to Phase Two, involving our network of affiliated attorneys.

The initial phase is critical in setting the tone for the recovery process. It is designed to maximize the chances of voluntary compliance by the debtor, thus avoiding the need for further legal action. The efficiency of this phase can significantly influence the overall success of the recovery system.

Phase Two

Upon escalation to Phase Two, the case is transferred to a local attorney within our network. Immediate action is taken to assert the seriousness of the debt recovery process. The attorney drafts a series of demand letters and initiates contact with the debtor through persistent phone calls. Despite these intensified efforts, some cases remain unresolved, necessitating a transition to Phase Three.

In this critical phase, the focus is on leveraging legal pressure to facilitate payment, while preparing for the possibility of further legal action.

If Phase Two does not yield the desired results, a strategic decision must be made. The options are clear-cut:

  • Continue with standard collection activities, such as calls and emails.
  • Proceed with litigation, understanding the associated upfront costs.

The choice hinges on a careful assessment of the debtor’s assets and the likelihood of recovery. The costs for legal action typically range from $600 to $700, depending on jurisdiction, and are required to initiate a lawsuit. Our firm’s commitment to a no-recovery, no-fee policy ensures that clients are not further burdened financially should efforts fail at this stage.

Phase Three

Upon reaching Phase Three, the path forward becomes clear. If the investigation suggests low recovery prospects, we advise case closure, sparing you further costs. Conversely, choosing litigation necessitates upfront legal fees, typically $600-$700, based on the debtor’s location. Should litigation not yield results, you owe nothing further.

The decision to litigate or withdraw is pivotal, with the latter allowing for continued standard collection efforts without additional charges.

Our fee structure is straightforward and competitive, with rates varying by claim volume and account age. Here’s a quick overview:

  • For 1-9 claims:

    • Under 1 year: 30%
    • Over 1 year: 40%
    • Under $1000: 50%
    • With attorney: 50%
  • For 10+ claims:

    • Under 1 year: 27%
    • Over 1 year: 35%
    • Under $1000: 40%
    • With attorney: 50%

In essence, our goal is to align our success with your recovery, ensuring a mutually beneficial outcome.

Recovery System for Company Funds

What is Phase One of the Recovery System for Company Funds?

Phase One involves sending letters to debtors, skip-tracing, investigating debtor information, contacting debtors via various methods, and attempting to resolve the matter within the first 30 to 60 days.

What happens in Phase Two of the Recovery System for Company Funds?

Phase Two includes forwarding the case to an affiliated attorney, drafting demand letters, contacting debtors via phone calls and letters, and providing recommendations for the next steps if resolution fails.

What are the options in Phase Three of the Recovery System for Company Funds?

In Phase Three, the options include closing the case if recovery is unlikely, proceeding with litigation (requiring upfront legal costs), or continuing standard collection activities. Rates for collection services are also provided based on the number and age of accounts.

What are the costs involved if legal action is pursued in Phase Three?

If legal action is pursued in Phase Three, upfront legal costs such as court fees are required, typically ranging from $600.00 to $700.00. If litigation fails, there are no costs owed to the firm or affiliated attorney.

What are the collection rates for accounts based on the number of claims submitted?

The collection rates vary based on the number of claims submitted within the first week. Rates range from 27% to 50% of the amount collected, depending on the age and value of the accounts.

How are accounts handled based on their age and value in the Recovery System?

Accounts are categorized based on age and value, with different collection rates applying to accounts under 1 year, over 1 year, under $1000.00, and those placed with an attorney.


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