MAKE YOUR FREE Collection Letter
Other Names:
Demand Letter
Debt Collection Letter
Past Due Letter
What is a Collection Letter?
Borrowing and lending money is a serious commitment; if the borrower hasn't upheld their end of the bargain a Collection Letter can help. Just because someone hasn't paid off their balance doesn't mean they're trying to shrug off their obligations: they might have issue with certain charges, believe they've already paid, or might have simply forgotten. This sample Collection Letter can help you address possible issues, resolve debts, and move forward.
A Demand Letter should account for likely complications by being detailed and thorough. Cite the principal amount, any interest or fees, and a description of what the original balance is for—including dates and locations. By clearly conveying all the relevant information you may be able to avoid future misunderstandings or any challenges to your claim.
If the other party isn't acting in good faith a Collection Letter can do more than simply relaying the amount to the debtor. If the debt remains unpaid you'll need to have solid documentation that you provided the borrower sufficient notice before you can increase collection activity. No one lends money expecting to run into issues, but having your efforts recorded in writing can help you take the next steps if needed. A Collection Letter is an important first action to receiving what you're owed.
A Demand Letter should account for likely complications by being detailed and thorough. Cite the principal amount, any interest or fees, and a description of what the original balance is for—including dates and locations. By clearly conveying all the relevant information you may be able to avoid future misunderstandings or any challenges to your claim.
If the other party isn't acting in good faith a Collection Letter can do more than simply relaying the amount to the debtor. If the debt remains unpaid you'll need to have solid documentation that you provided the borrower sufficient notice before you can increase collection activity. No one lends money expecting to run into issues, but having your efforts recorded in writing can help you take the next steps if needed. A Collection Letter is an important first action to receiving what you're owed.
When to use a Collection Letter:
- You want to collect payment for an outstanding debt.
- You are considering more forceful collection measures.
Sample Collection Letter
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COLLECTION LETTER
Dear ,
This is a reminder that your account with us appears as past due. Our records indicate that you have an outstanding balance with the following invoice overdue:
| Past Due Date |
| Principal Balance |
| Description |
In addition, on , the interest began to accrue at a rate of % per annum. As of the accrued interest you owe equals .
Summary of Charges:
ACCRUED INTEREST:
TOTAL BALANCE DUE:
Please let us know the status of this payment. Please do not hesitate to call us if you have any questions about the balance on your account. If we have not heard from you from within 30 days of the date of this letter, we will initiate further action that may result in legal proceedings.
Regards,
| By: | Date: |
