We represent small business owners in a variety of matters, but an important part of our practice is helping these clients collect debts owed to them. We have blogged about this before, particularly about the different approaches to collection that might be taken to secured versus unsecured debts.
Staying on top of debt collection is important to keeping a business cash-rich and may be crucially important to commercial success if the new enterprise is started on a slim budget.
Hire a knowledgeable lawyer
When a new business is launched, there are many things to consider and much to do to get off the ground. In the excitement of the new venture, the owner may not give much thought to the future role of the business as a creditor that is owed debts. It is crucial to involve an attorney in the development of the business, including drafting airtight contracts and agreements for use in transactions with customers.
Careful drafting of contracts should maximize the business owner’s legal rights to collect on future delinquent debts. For example, make explicit the payment requirements and the steps that will be taken if those expectations are not met by the customer.
Especially for a small, local business that might need to develop and preserve relationships in the community, the first step may be to informally remind the customer about the late payment. If payment is not forthcoming, the owner should work with legal counsel to decide on next steps, which could include involving a collection agency or filing a lawsuit.
We will cover in more detail collection options and creditors’ rights in future posts.
In Albuquerque and throughout New Mexico, the law firm of Giddens & Gatton Law,amp; Jacobus has bankruptcy attorneys who offer expert handling of Chapter 7, Chapter 11, Chapter 12 and Chapter 13 bankruptcy cases and can specifically provide advice as to bankruptcy and its alternatives.
We represent many debtors and creditors in Albuquerque, Santa Fe, Las Cruces, Taos, Raton, Farmington, Gallup, Grants, Roswell, Los Lunas, Placitas, Belen and the rest of New Mexico. Contact Giddens & Gatton Law,amp; P.C., at (505) 273-3720 to set up an appointment or visit the firm’s website at giddenslaw.com. Giddens & Gatton Law,amp; P.C., is located at 10400 Academy Road N.E., Suite 350 in Albuquerque, New Mexico.