No creditor would wish to devote significant resources to regaining debt where this may be prevented. It is important that where money that you are owed has not yet been paid, you have the aid of specialist solicitors that can pursue this for you personally as a matter of urgency. Sometimes taking rapid action is likely to make the difference in if you're able to recover the debt successful.
Recovering Commercial Lending in Scotland
In BBM Solicitorsour commercial staff understand the realities of being made to recover commercial debt, regularly working with businesses to put contracts and systems in place that increase the chance of bad debts. But, we also appreciate that instances do arise where the repayment of debt is withheld or just can't be paid, requiring more appropriate actions. Our team offer a specialist provider, navigating our clients through the legal procedures necessary to recoup the industrial debt they're due.
Recovering Due Debts: Engage with the debtor
It's highly recommended that when debts fall on account of a creditor needs to speak to the person or business in question, making them conscious of this circumstance. It's necessary to get into some sort of dialogue with a lien: outstanding debt may be due to absentmindedness in their own part, and a gentle reminder may be enough to cause payment. However, it could be possible they're refusing, or lack the funds, to make payment to the debt.
It is important that when contacting a debtor, a creditor makes them aware of the consequences of failing to repay their debt:
Where the contract allows it, or where the client is a company insured by the late payment of commercial loans laws, interest could be applied to the amount they owe.
It's critical that creditors give borrowers honest warning of the chance of legal actions being taken against them if they don't make payment in a reasonable period, e.g. seven days.
In BBM Solicitorswe regularly engage with debtors in their lenders' behalf. It's our adventures that getting in contact with a debtor, and informing them of the effects of the actions, will normally yield consequences for creditors.
Taking proper legal action to recover debt
If a borrower fails to make payment on an unpaid debt, and has been given notice of the impacts of their actions, then a creditor may then proceed to raise formal legal proceedings against them.
Pursuing Insolvency Options
No matter whether a debtor is a corporate body or a person, it is possible for creditors to take advantage of the bankruptcy regime to recover the debt. The principles, however, are somewhat different for every kind of debtor:
Where a borrower is a limited company and the debt is undisputed, often the ideal approach to forcing payment is that a 72 hour winding up requirement, which demands the satisfaction of their debt over the time frame. This involves Sheriff Officers operating a need notice we've drafted, calling for payment of the debt. Where payment isn't forthcoming (and not disputed), a creditor may then seek the court's consent to put the company into liquidation, and to appoint a liquidator. This type of demand tends to prompt a reply!
Where a borrower is an individual with a little interest in real estate, it's likely to place them into bankruptcy to secure outstanding debt. This is called'sequestration'. However, there are limits on what could be done with a debtor's house, particularly when their family lives together.
Proceeding with Diligence
Assuming that a debtor has not responded to, either or defended against, a creditor's attempts to recover commercial debt, and that the insolvency regime would not be useful, a lender may request the court to issue an order (known in Scotland as a decree) recognising the debt is due.
Based upon the value of the outstanding debt, then a petition for a court to give decree should be raised in one of two places. The Sheriff Court will handle all legal disputes concerning debt recovery, while legal actions concerning debts of a high value, e.g. over #100,000 who are extremely complex, ought to be brought before the Court of Session. The worth of the debt will also determine the court procedure and time frames which have to be viewed.
You will find a number of alternatives available to creditors pursuing diligence against a debtor. The usefulness of these measures will be dependent on the situation in question. The choices offered are as follows
Earnings Arrestment
That is an order in the courts that instructs a debtor's employer to deduct the cash owed to lenders directly out of their monthly salary. But, there's a limitation on the quantity which can be taken from a debtor's salary, based on how far they earn.
Arrestment
It is open to lenders to prevent creditors from getting cash that they have in their bank account, although certain minimum amounts might be abandoned. This measure will require paperwork being done by debtors, so stipulating that cash be subtracted from their account and paid to lenders, through the courts, in satisfaction of their debt that is outstanding.
Inhibition
Where a debtor does not have any savings or is unemployed, but does possess land, a creditor could prevent them from selling it. This secures the value of their home for the creditors for a period of up to five years.
Attachment
This involves Sheriff Officers making an inventory of land capable of being marketed, e.g. non-essential items possessed by the debtor like a vehicle, that could be seized and sold to repay debt. Attachment does not consist of property in a debtor's home. This will only be effective at seizure in which an'Exceptional Attachment order' has been granted by the judges.
In BBM Solicitors we've got a long, successful history of working with companies to guarantee the payment of all debts. Our team offers assistance and advice that reflects our client's requirements, offering effective solutions to legal issues. We can handle every aspect of your situation, such as calling debtors, increasing court actions, and representing your interests when demanded. If you will need help in regaining commercial debt, please contact our commercial team at BBM Solicitors.
Debt Collectors in Glasgow City
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If all your customers paid their bills in time, running a business would be much simpler, would not it? In fact, you frequently have to wait for payment, which makes you tons of money to invest in your business or even pay your bills. You also have to locate the resources to cope with the extra administration caused by slow payers. Additionally, losses from consumer liquidations and bankruptcies are trying. Many of these business failures have been predictable and therefore avoidable.
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