Getting frustrated with clients who just won’t respond about overdue payments. It made me think about what legal stuff I need to keep in mind while pursuing these invoices.
Are there different laws across states regarding debt collection? I don’t want to mess anything up while trying to get what I’m owed.
Laws vary by state but a simple call works.
Look at your contract for late payment terms. Many states allow fees if they are specified in your agreement.
I include a clause for collection costs. This way, if legal steps are needed, the client covers those expenses.
Review your state’s rules on debt collection before taking action. Many areas allow late fees if your contract mentions them. Save all communication records. After an invoice is 30 days overdue, consider sending a formal demand letter. Some states have specific wording for collection notices. If it reaches 90 days overdue, look into small claims court or hire a collection agency. Keep detailed documentation as it may be important later.
Been through this mess more times than I want to count. Here’s what I’ve learned the hard way:
Check if your state has a Fair Debt Collection Practices Act. Some states are stricter than others about what you can say and when you can call.
Document everything:
Most states let you charge interest on overdue invoices even without a contract clause. Usually around 1.5% per month. Worth looking up your state’s statutory rate.
If you’re dealing with a business client versus an individual, different rules might apply. Business debt collection is often less regulated.
Don’t threaten legal action unless you actually plan to follow through. Empty threats can get you in trouble in some places.
You might try sending a firm reminder. Sometimes that gets their attention.