How to Collect Money from People Who Owe You: 14 Steps

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How to Collect Money from People Who Owe You: 14 Steps
How to Collect Money from People Who Owe You: 14 Steps

When you lend someone money, you don't always get it back. The debtor has broken a promise, and you shouldn't feel bad about asking for money someone owes you. Whatever the reason for the original loan, when a person owes you for default, there is always something you can do. Sometimes it just needs a simple reminder, but being prepared to scale your orders effectively can increase the chance that you'll receive what's rightfully yours.


Part 1 of 3: Asking for money

Collect Money From People Who Owe You Step 1

Step 1. Define whether you have reached the time when you believe you will be paid without having to ask

If the initial agreement does not have an explicit payment date, you will need to determine it yourself.

  • Consider the amount owed. A small debt may not be worth it, but one of considerable value should not be overlooked.
  • If the money owed is related to a business transaction, collect it as soon as possible. Waiting will make it harder to receive.
Collect Money From People Who Owe You Step 2

Step 2. Ask politely about money

After the stipulated date passes, ask for the money. At this stage, you should only let the debtor know that the debt has not been paid. Sometimes people just forget and just need a friendly reminder.

  • Do not demand payment; prefer to make a reminder ("Do you remember that money you borrowed?") that allows the debtor to protect himself.
  • Include all relevant information when inquiring about debt. You should be prepared to provide the amount provided, when you received the last payment, the amount due, the agreements you are willing to accept, your contact information and a clear payment date.
  • If you are dealing with a company or customer, asking this question in letter form can help as it will provide written evidence in case the situation gets worse.
  • A good deadline for payment would be between 10 and 20 days from the date of receipt of the letter. That time is in the near future, but not close enough that the debtor will panic.
Collect Money From People Who Owe You Step 3

Step 3. Decide whether to accept alternative forms of payment

It may not be worth waiting for the full amount. If it's small or you don't believe the person can pay, consider letting them provide something else in return. Performing a service or other favors will do, if such an agreement is acceptable to you. If so, be clear about the offer and pursue payment as soon as possible.

Don't accept the exchange too soon, as this can give the impression that the debt can be negotiated or that the debtor can take even longer

Collect Money From People Who Owe You Step 4

Step 4. Be more incisive when charging

If the debtor does not respond to the first request, be more direct. Make it clear that you expect immediate payment or a final commitment, and provide clear instructions on how to pay.

  • The language here should be more direct and demonstrate a certain urgency. Phrases such as "You need to pay now" or "We need to reach an agreement now" will tell the debtor that you are serious and that you have no intention of negotiating any further.
  • Include clear consequences for non-payment. Let the debtor know what you intend to do if you do not receive the amount owed on the correct date, and be prepared to put this plan into effect.
Collect Money From People Who Owe You Step 5

Step 5. Continue increasing billing rigor

If you do not receive any payment after the second contact, it is possible that the debtor does not have the money or does not want to pay. Your job is to get him to make you a priority through various phone, letter, email, or personal contacts, so that he decides to pay you before anyone else (or run off into the hills).

Collect Money From People Who Owe You Step 6

Step 6. Hire a collection firm

Hiring a third party to handle your complaint informs the debtor that you are serious and frees you from the trouble of contacting them and negotiating payment. Firms will charge up to 50% of the amount for the service provided, so you need to decide if a partial payment is better than nothing.

If hiring a collection firm is too expensive, you can skip this step and file suit in Small Claims Court

Collect Money From People Who Owe You Step 7

Step 7. Know what you cannot do

If you are collecting your debt, there are certain practices that may be illegal in the region where you live. There are laws that regulate the practice of collection, and even if they do not apply to individuals but to firms that specialize in this task, you will still need to stay within what is acceptable under the laws of your state. In general, it's best to avoid the following tactics:

  • Calling at absurd times;
  • Add fees;
  • Delay receipt of the amount on purpose to increase fees;
  • Telling about the debt to the debtor's employer;
  • Lie about the amount owed;
  • Making false threats to the debtor.

Part 2 of 3: Taking legal action

Collect Money From People Who Owe You Step 8

Step 1. File a lawsuit in Small Claims Court

Check the laws of your state or the website of the Court of Justice to find out if you can file a lawsuit, as there is a limit on the amount involved in the case, which generally cannot be higher than 20 minimum wages for those who do not intend to hire one. attorney. You can find your state's court of law website on the National Council of Justice page, "Court sites".

  • If you go to court, prepare for the hearing. If you have a contract, promissory note, or other documentary evidence of the debt, make enough copies to provide to the judge and the debtor or the debtor's attorney. You can also copy any other evidence you wish to present in the same way.
  • This step can be drastic, so see if the amount owed is worth the trouble of appearing in court. If the debtor is a friend or relative, this measure is sure to have a negative impact on your relationship.
Collect Money From People Who Owe You Step 9

Step 2. Enter the process

If you lose in Small Claims Court or cannot file a lawsuit there, go to the State Court of Appeals. Consult or hire an attorney, fill out the correct forms and prepare for the hearing date with all the necessary paperwork you can muster.

  • This option is generally more expensive considering the fees charged by the courts and attorneys' fees, but if you are successful, it may be worth more than using a collection firm.
  • The threat of prosecution may be enough to make someone pay, but avoid making such a threat unless you really intend to move forward.
Collect Money From People Who Owe You Step 10

Step 3. Complete a Notification Petition

After obtaining a judgment unfavorable to the debtor, you can file a Notice of Notice for contempt of court if it is still not paid. Completing this document along with a Petition for Designation of Hearing will cause the court to schedule a hearing, forcing the debtor to come back and explain why he has not paid the debt.

At the hearing, you must ask the court for permission to deduct the debt directly from the debtor's salary

Part 3 of 3: Getting paid

Collect Money From People Who Owe You Step 11

Step 1. Get the money

After the entire process of asking, demanding and suing to receive the money, the debtor will be forced to pay. Sometimes it's just a matter of asking. In other cases, it may be necessary to take additional steps decreed by a court, perhaps a Mandate of Enforcement or a Right of Retention, to receive correct payment.

If the case has gone to court and you have engaged the services of an attorney for that purpose, consult with that professional to decide the best course of action

Collect Money From People Who Owe You Step 12

Step 2. Locate the debtor's employer

Once you receive permission from the court to deduct the debt from the debtor's salary, it will be up to you to determine where that person is employed. The easiest way to do this is to ask her. If the debtor does not want to count, it may be necessary to send a set of interrogations, which are questions that must be answered in writing and under oath. Check your state court's website to find the interrogation forms.

Collect Money From People Who Owe You Step 13

Step 3. Send the interrogations to the debtor's employer

Once you believe that you have found the person's current employer, you will need to send inquiries to them to confirm that the debtor is employed and that their wages are no longer being deducted.

Collect Money From People Who Owe You Step 14

Step 4. Ask for a wage garnishment order

Once you receive confirmation that the debtor is employed, you can ask the court for a wage garnishment order, which will be sent to the employer to begin deducting directly from the debtor's wages.

Check which laws govern wage garnishment in your region


  • Don't feel guilty about charging you what they owe you. You didn't break the word; the debtor does, and you have every right to collect it.
  • Remember to stay calm and not get nervous. It is the debtor who should be upset because he has not kept his promise to pay. Being firm yet polite increases your chances of getting paid.
  • If a person or company is used to giving them work when paying, think carefully about working with them again in the future.
  • Keep all paperwork during the process, especially if the matter ends up in court. For business transactions, preserve legal documentation whenever possible.
  • The billing procedure provided in this article is for basic informational purposes. Please be aware that the specific forms that must be completed in your region may vary and the procedure may be in a different order. Research before filing a lawsuit or hiring an attorney.


  • If a debtor has filed for bankruptcy protection, stop collecting it immediately to avoid violating federal bankruptcy and debt collection laws.
  • If you are collecting a commercial debt, read the applicable laws or you could end up being prosecuted.
  • Try not to reveal to any other parties that the person owes you money, as you could end up committing slander or defamation, depending on the circumstances.

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