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ToddS
09-23-2004, 08:09 AM
What is the best way to collect on these accts? Has anyone had any success with Small Claims Court? Please keep in mind that these are accts that are delinquent several months. Thanks

Todd

crawdad
09-23-2004, 06:17 PM
Knock on their door when they have company. Be polite, and give them the bill.
Crawdad

mx495
09-23-2004, 09:27 PM
As long as you have some kind of documentation you can get them in small claims. I have done it before and it is easy, The first time it's kind of a pain, but after that it's pretty much as easy as a visit to the courthouse. I think all states are different but here it just has to be under 5 grand for small claims. Write a letter saying you are GOING to take them to court if they don't pay, most will pay with a threat, the rest will usually pay when the get a certified letter from the court saying if they pay they won't have to see you in court. Most people are as afraid as you are to go to court, and it is an inconveniece to them. If you win they pay court costs, if you lose your out the filing fee which is $25 here.

Team Gopher
09-24-2004, 02:54 PM
Hi ToddS,

Here is a great quote from this post (http://server2.lawnsite.com/showthread.php?t=77126).

"I read where one person said his uncollected accounts for last year were 8%. Well, here's a little secret about collecting on old clients who still owe you money. Now a collection agency will charge you anywhere from 40%-60% of the uncollected balance as a fee if they collect the money on your behalf. Let's say an old client still owes you $100. Well, the collection agency will get $40-$60 of that (on avg) as their collection fee. Well, here's the secret. Nearly every courthouse in the US has a mediation division. This is a free service. You simply walk into the office, write down how much the person owes you along with their name and address. It takes < 10 minutes. Your county courthouse will mail a letter to that person indicating that they are requested to appear on xxx date at the county courthouse for mediation. Here's what works...the letter looks very similar to a court summons for small claims law suits. It even states, John Doe vs Joe Customer for xxx dollars in xxx county before the county judge Joe Blow. Most people see this letter from the courthouse arrive in their mail and immediately call with an apology and the check arrives the next day. I've even had people hand deliver the payment with a few hours of receiving the letter. Some of the accounts I collected on were up to 2 years past due. That's unheard of in collections. It's almost impossible to collect on accounts past 120 days even using collection agencies. Again, this is a free service offered through your county and state. If the person does contest the money owed and they show up at the courthouse, you will then meet with a mediator. Takes no more than 30 minutes. This means you and the customer sit down at a table and a mediator sits in the middle and hears both sides of the story. The mediator tries to help reconcile the problem. If it doesn't work, the only other option is small claims court. However, small claims is not worth the cost or hassle for small dollars. With the free mediation service, any amount is worth going through with this process. If the person gets the letter and pays you before the scheduled mediation date, you simply call the mediation office and tell them. They will then close the mediation case.
I've used this with about 26 former accounts over the last 10 years. Unfortunately in business, we will have clients who don't want to pay for whatever reason. It happens. This is a simple way to give you the edge.
Now you may be thinking, "I don't want a reputation in the community of someone who takes clients to court". Let me tell you, I have never had any bad press or reports to the BBB. These people owed me $$. It worked and nearly all clients paid and were apologetic. I even had this method featured in an article of Smart Business Magazine. Hopefully, you don't have to resort to this collection method but it's there if you need it."

HOOLIE
09-24-2004, 11:10 PM
I haven't gone to Small Claims since I've been in business, but I went about 30 times over the years at my old job. Won almost all of them, except for a couple that we mediated and reached an agreement on. In Virginia, anything under $1,000 is Small Claims.

The way it works here is, you call the courthouse to set up a trial date, usually at least 4 weeks or more down the road. The court sends you the papers within a few days. The key part is, you don't have to send the filing fee right away, as long as the court gets it before the trial date you're OK. So what I would do, I would set the date, get the papers, send one copy to the deliquent customer, and what for their phone call. About 80-90% of the time they'd call to make payment arrangements. Then I'd call the court back to cancel the trial, and since I'd never even sent the filing fee in yet, my boss wasn't out any money. Of course if you do go to court and win, the defendant owes you the filing fees as well.

lasher66
09-24-2004, 11:46 PM
If I have a customer that owes me money from 2 mowing seasons ago, can I still take them to small claims? just wondering.

Lasher

HOOLIE
09-25-2004, 01:12 AM
Lasher,

Not sure about this. I'll bet it varies from state to state. I did ask the court clerk once, she was pretty sure there's some statute of limitations, but she wasn't sure what it was. 2 years might still be OK. We had a guy who stiffed us and moved away. Maybe 4 or 5 years later he moves back into the area, and calls us for an estimate. Must have forgotten who we were. I left him an estimate- $35 per cut, with a deposit of $845 (to cover what you owe us). Needless to say, he didn't jump on that. And I still don't think he's ever paid my old boss.

horselady
09-28-2004, 11:28 PM
The Statute of Limitations is 10 years in Indiana.