Great News! You settled your New York Debt Collection claim. You have another chance to better protect yourself to make sure payment is made as agreed. To do so you should incorporate the terms of the settlement in a written agreement. If you think you do not need a written agreement, think again. Here’s why:
A written agreement drafted by your New York Debt Collection Attorney will insure payment will be made as promised by your customer or you will be entitled to judgment. By having the customer concede that the monies are owed you, and that if payment is not made as promised you should be permitted to enforce your rights to get paid with little or no effort.
Fear not, the agreement should not alienate the customer but best protect your rights to get paid. In fact customers are often willing to enter into agreements to avoid being sent to collection or to avoid further litigation after a case has already been referred out to a debt collection attorney.
Settlement agreements can be used to memorialize payment arrangement before, during and after debt collection litigation. Specific terms that would be incorporated into the agreement would depend upon your specific agreement and to the extent that you wish to protect yourself in the event of non-payment.
Terms that should be included in the settlement agreement depend upon your agreement with the customer. Specifically:
- Timing of Settlement: Did you settle in house or after the claim was referred to a New York Debt Collection Attorney?
- Debt Collection Phase: Has debt collection litigation, arbitration or mediation commenced?
- Judgment: Will your client agree that judgment can be entered against them in the event of nonpayment?
- Cost of Collection: Will your customer agree to pay the cost of collection?
- Legal Fees: Will your customer agree to pay the legal fees incurred by you as a result of their non-payment
- Length of Payout:What is the length of the term of the payout? For example, a Confession of Judgment is valid for 3 years.
- Statute of limitations: Is your time to collect the debt expiring?
- Release: Will you and/or your client want a release once payment is made?
- Personal Guarantee: Will an Officer of the corporation personally guaranty the terms of the settlement?
- Conditional Settlement: Will payment trigger an event? For example, will the client need to make payment before you agree to release product to them or go back with a punch list?
- Confidentiality: Will the terms of the agreement be kept confidential?
- Execution: Will an officer of the corporation sign the settlement agreement?
Settlement agreements offer opportunity of added protection to a creditor who has a promise of being paid. Make sure you take advantage and have an experienced debt collection attorney to represent your best interests.