As a professional debt collection agency, we always provide recommendations to clients as the case goes on. We will list the detailed reasons for such recommendations, their pros and cons, and what could happen with all foreseeable scenarios. Most clients could follow our recommendations and therefore achieve the best result under such circumstances. However, there are some clients who insist on their own thoughts and therefore bring the debt recovery to a worse situation than we previously discussed with the clients. They believed they could accept the worse situation, but they actually couldn't accept when it actually hits. We have shared many successful debt recovery stories in our blogs, here we share a negative example.
Background
By mid-July 2022, Xservice Debt Collection received an appointment to recover outstanding commercial rent, approximate amount $65,000. At the time of appointment, the lease agreement was still ongoing however the tenant had already moved out due to the landlord threatened to change the lock if the tenant don’t pay.
The Debt Collection Process & Recommendation
Xservice Debt Collection started actions immediately after the appointment had been received. After a week-long negotiation with the debtor, considering various disputes raised by the debtor, we came to a payment proposal of $45,000 payment to be paid over 5 months. Then we reported to the client and discussed the proposal, client rejected it. After another week-long consideration by the client, the client came to a counter offer of $100,000 with one immediate lumpsum payment (client took into account the future unearned lease because the lease was still ongoing). We assessed the client’s $100k counter offer and believed it was non-realistic under such circumstances, and therefore recommended the client counter offer of $45,000 plus bond (bond amount $20,000) to be paid over 5 months by the debtor, which is approximately 100% recovery. However, the client still denied, and firmly requested $100,000.
The Result
After a month of back and forth negotiations between the client and debtor, the client compromised a few times and finally agreed to our previous recommended proposal, and the debtor also compromised to give up the bond. However, the debtor’s cash flow deteriorated after a month, hence requested further delay of the first instalment, just like what we foresaw when providing recommendations a month ago. Although the client now agrees, the debtor’s situation has changed. The client refused to further delay the first instalment, and subsequently the matter went to legal action.
Are you looking for an active debt collection agency to recover outstanding debt? If your client is not paying invoices in Australia, contact Xservice Debt Collection for an obligation-free assessment. With more than ten years experienced expert to evaluate your situation, our debt collectors could provide customised solutions and recommendations for your specific case scenario. Let us take the hassles over from you, just follow our recommendations, and we’ll bring you the best possible result in recovering your debt.