Commercial collections can be confusing for business owners. One of the most common concerns we've noted is the statute of limit on commercial collections. Different sorts of debt have different time limits. Can an older commercial debt ever have that time limit reset? In many instances, the answer is yes.
How Would Re-aging Help Commercial Collections?
When an account is re-aged, it renews the statute of limitations. This means your business gets more time to try and collect on the account. You could continue to work with the debtor on a payment arrangement or you could take more serious steps and hire a collections lawyer or sue for the money that is owed to you.
Sometimes, debtors may contact you and ask you to re-age the account because they intended to pay. Whether you agree to do so should be based on whether you believe the debtor has the willingness and the ability to pay, that they admit that they owe the debt, and whether that debt was listed as part of a bankruptcy.
The Importance of a Collections Process
Re-aging a debt to restart the statute of limitations is only one part of the commercial collections process. Keep in mind that you need a collections process that starts the day after an account becomes delinquent. The sooner you begin the collections process, the more likely it is that you will be able to collect on the debt. You should understand your options for collection: keeping it in-house, hiring a third-party debt collector, selling your debt, or hiring a lawyer who can help you exercise your legal rights.
For more information on the debt collection process, contact experienced commercial collections attorney Ronald P. Slates today.