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A Debt Recovery Solicitor Can Help You Claim Interest On Commercial Debt

By Jo M Robinson

Republish: EasyPublish™ Published: 10May2011 Word count: 1128 Viewed: 106 time(s) Get Free Content For Your Site

It is difficult for many small businesses to continue operating when larger companies avoid making payment for as long as possible. The reason that some corporations do not pay their bills on time is because they profit from the interest the money gains while it remains in their account. When you have financial problems because your customers have not made payment you should contact a debt recovery solicitor.

You may know someone who can recommend a good debt recovery firm of solicitors or you could undertake some research online to find one. You may think that employing the services of a solicitor that deals in commercial debt recovery is something that you cannot afford. A debt recovery solicitor will not only help you to reclaim the money that is owed to you, they will also be able to help you claim interest on that debt. The 1998 Late Payment of Commercial Debts Interest Act was updated in 2002, under that act you are allowed to claim interest of 8% above the rate set by the Bank of England. Once your debt recovery solicitor writes to the company that owes you money stating the rate of interest they owe, it no longer benefits those who owe you money to keep that cash in their account. This process was introduced to try and persuade people that withholding payment to accrue interest was not good business practice.

Your solicitor will explain the process of commercial debt recovery to you and the steps that they will take to recover your money. The solicitor will begin by taking all the details of your business with the company that owes you money. Providing the other company do not dispute that they owe you the money the debt recovery solicitor can write them a letter. If the debtor ignores the letter and the debt is more than £750 then a statutory demand note can be issued.

A statutory demand note is a legal document that gives the company twenty one days to pay what they owe, including any interest. If the debt is not paid in full then at the end of that period your debt recovery solicitor can apply to the court for a winding up petition. In effect this is a notice that you intend to make the company bankrupt and petition the court to appoint a liquidator. The debtor may decide to pay the debt including costs and interest to avoid liquidation unless they cannot pay in which case the winding up process will begin.

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