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Bill collecting help

Ducki_Contreras's picture

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Has anyone had to use a professional service to collect delinquent accounts? How or where should I look for this? I am located in central Jersey, though I don't know that it really matters. Thanks,hungry and pissed off.

fdampier's picture

Fair enough,


  the economy slowed down at the same time so perhaps our loss of business should factor that in more to the equation. I just remember going and talking to one of our former customers who left us. He wouldn't look me in the eye, stirred the dust with his toe and acted for all the world like I was the mafia.  Left me with the most uncomfortable feeling I've ever had in decades of doing business.  We had no issues with him, he paid his bills and did a good deal of business with us. He left because he was afraid that someday we'd feel that we had to put the "arm" on him.


       Now after that I went and talked again to the bill collector involved to see if I misunderstood what transpired.  Make no mistake, the guy owed the money, while he kinda disputed it,it wasn't at all in question.  His arguements were basically "well you're makin' plenty so what I owe isn't important." 


     While looking for a solution one of his friends (that we lost ) indicated that he had some pretty severe personal obligations (That he never mentioned to us) and paying the bill really cut into not only his cash flow but his personal obligations.  He had to go to a lot of his "friends" and put the arm on them to survive.  That kinda gave me an answer why it wound up hurting us  so much.  One guy talks to another and the story gets changed and maybe enhanced, and suddenly a reputation we've worked for decades to earn is trashed. Our only defence is to talk to everyone and try to reearn their trust.  So far it hasn't turned around.


    The money involved wasn't in anyway the differance between profit and loss, we collected out of principle.  The collector we used wanted to collect the full amount rather than some work out in order to get his full commision.  If  we had been in conversation, it would have been simple to develope a workout, but he was a master at avoiding us.  


     What we actually netted out of the deal amounted to less than 5% of our monthly decrease in revenue.  How much of that is due to the changed business climate and how much can be directly attributed to collection is debateable.  Just in retrospect we shouldn't have.........

LRutherfor1's picture

The only thing that everyone left out of the discussion is a "mechanic's lien".  You have the right to lien the property of the person that owes you money.  If they sell or refinance the property, you will be paid as a second mortgage holder.  It might take a while, but it's the law, and they can't get around it unless they file bankruptcy.


Len (Len's Custom Woodworking)

riverr1's picture

That would drastically depend on the nature of the work you did or do. Build a guy a custom desk and don't get paid, I doubt you'll have much luck with a mechanics lein. Build and install the kitchen cabinets, and you'll probably pull it off.


Don

LRutherfor1's picture

You are probably right that you wouldn't necessarily get paid on a small job, but you do have the right to file the mechanic's lien.  The law states "On any private project, the lien laws or rights apply". 


I teach classes in "Contract Documents and Construction Law, and I've seen examples of mechanics who have won settlements as low as a few hundred dollars.  Anything lower than that number, you're better off to file a claim in small claim's court.


Len (Len's Custom Woodworking)

riverr1's picture

When it comes to the courts you never know. I think it often just depends on the mood of the day. Around here though, as far as I know, to file a mechanics lien you have to have worked as\at what at one time was called a mechanic. That would be plumbers, electricians, carpenters, masons, etc. A cabinet maker building someone a custom piece of furniture like a diningroom table I don't think would have anymore luck filing a mechanics lein then a doctor would for non payment of a bill. Now if you were building custom kitchen cabinets, then the mechanics lein could apply. In this situation we don't know the nature of the work performed.


Don

AlanTurner's picture

Mechanic's Lien laws in each state are different.  Some require that after a lien is filed, the lienor (creditor) must file a complaint in court within a certain time frame, such as 90 days, or the lien is extinguished.  Clouding title to real estate makes people (debtors) nervous; as to personal property, less so.  Ws the piece permanently installed, so that the lien might attach to the title to real estate is an issue worth considering.  Some states allow a lienor to hold the property until full payment is recieved (useful for an auto mechanic) and might be used if a custom piece hits the shop for a tweak or repair.  Many small claims courts are business friendly, and do not require a  lawyer. 


Or, as a carpenter friend of mine used to do, you could consider showing up at the site with a crowbar and threaten to remove the trim, doors, sheetrock, etc., till payment is recieved.  He did get paid this way, but this approach I would not recommend.