What Happens If a Debtor Gets an Attorney?

Earlier this year, we explained the common signs you need to hire a commercial collection agency to deal with someone who owes you money. What happens if a debtor gets an attorney to deal with the debt collection process? This article explains what happens after a business debtor gets an attorney and how it affects how we handle commercial debt collections.

With the commercial debt collection process, the first step involves contacting the debtor and letting them know that we’re working to collect money that they owe to the original creditor. Some businesses that owe money to creditors don’t like hearing from a commercial collection agency and have a tendency to make the collection process more complicated than it needs to be.

As soon as we are informed a debtor has hired an attorney, we as a commercial collection agency are required to discontinue any discussions with the debtor. While the Fair Debt Collection Practices Act (FDCPA) doesn’t apply to commercial debt collectors, agencies have to obtain licenses to practice debt collection. They also have to work with the Commercial Collection Agency Association (CCAA) to maintain responsible and professional commercial debt collection activities. One of the first steps a debtor’s attorney makes is to negotiate with the commercial collection agency on an amount that the debtor will pay to resolve the debt owed.

If negotiations don’t go well, then the original creditor may decide to sue the business debtor. This can happen if the debtor’s attorney decides not to immediately or eventually contact us about the debt. This can happen due to a lack of communication between the attorney and the business debtor. It can also happen if the attorney is owed money by the debtor and doesn’t want to invest more time into resolving the debtor’s financial issues. If the negotiations go positive, then the creditors will come to an agreement on an amount the debtor will pay to resolve the debt.

As a top professional commercial collection agency, Prestige Services, Inc., has the skills and knowledge to finish debt collection jobs smoothly and in a way that improves the way our clients handle their business.