Tips for Collection In Tough Times


A NL guest blog written by Philip A. Kahn, Esq. and David Levine, Esq. – published May 9, 2016 and reprinted by permission of Fein, Such, Kahn & Shepard, P.C

The documentation submitted to collection counsel in support of a debt collection claim against a former customer is of great assistance in the attorney’s handling of the case and, the better the documentation, the greater chance of collection. Credit applications, invoices, telephone numbers, banking information, employment information, and personal guaranties provide valuable information regarding assets and income in the event it becomes necessary to collect a judgment through forced measures. It is always important that the client knows exactly with whom they are conducting business.

The credit application is an extremely valuable source of information. It is recommended that a creditor utilize a credit application that contains necessary information to assist a credit analyst not only to decide whether to do business with the potential customer, but also to assist in the ongoing review of the credit relationship, and provide support to counsel in the event of a default. Credit applications can make a substantial difference in the collection of an account if a customer does not pay and must be forced to do so through litigation. It is important to ask on a credit application whether the company pursuing credit is a corporation, Limited Liability Company, proprietorship, partnership or something other than those categories. Sometimes a personal guarantee may be necessary or recommended as a form of security in the event of a default. That could be the difference in either recovering through third party intervention or ultimately writing off the account. The credit application should also contain a stated percentage to be added onto the amount owed in the event the claim has to be referred for collection as well as a monthly interest charge on any invoice over 30 days past due.

Further, it is recommended creditors retain a copy of any checks they receive from the customer. In the event it becomes necessary to collect a judgment through forced measures, the check provides the debt collection attorney with banking information for purposes of attaching the bank account towards payment on the judgment.

As a final word, the more detailed the underlying documentation the better chance the creditor will make an informed decision on whether to extend credit to the customer. Furthermore, in the event it becomes necessary to collect a judgment through forced measures it is always useful for the creditor to provide asset information already obtained to the debt collection attorney in the event it becomes necessary to collect a judgment through forced measures.

For more information please contact via email Philip A. Kahn or by phone at 973-538-4700 ext. 122.

Fein, Such, Kahn & Shepard, PC is general practice law firm of more than 50+ attorneys serving clients in New Jersey and New York. For over 25 years the firm has offered innovative solutions to business and individuals in the areas of asset protection business planning, civil litigation, creditor representation in the areas of foreclosure, bankruptcy and collections, elder law, family law, personal injury, tax, and trusts and estates. For more information, go to

This Article does not constitute legal advice nor create an attorney-client relationship.

© Fein, Such, Kahn & Shepard, P.C., all rights reserved. Permission is granted to reproduce and redistribute this article so long as (i) the entire article, including all headings and the copyright notice are included in the reproduction, and (ii) no fee or other charge is imposed.


Categories: Compliance, Creditors' Rights, Debt Collection, Guest Blogs, NL Insider

Tags: , , , , , ,

Leave a Reply

%d bloggers like this: