Is there anything more frustrating than a client refusing to pay? They pay you for all the work, and then you get nothing. You are responsible for your financial obligations and costs associated with a job. We don’t have to tell you that not getting paid can be stressful.

The debt collection process offers you many options. You have options, and you should act when you are required to.

You’ve reached the right place if you are tired of trying to chase down bad debtors. This article will show you how to create a successful letter of demand from the best letter of demand template.

What is a formal demand letter?

What is a demand note? A demand letter is a request you send to someone in writing, asking them to pay the debt. You can send anyone a demand letter. If someone owes money to you, you have the right not to involve a lawyer.

Many businesses prefer to have their correspondence professionally written by their lawyer. Letters written by professionals are generally considered to be more valuable. A letter of demand can be used to prove that you are serious about the matter and will take it further if necessary.

How it works

After you have sent several reminders and requests in writing, a formal letter should not be sent. After you have tried everything to reach the other person, the demand letter is sent.

After the debtor receives the demand letter, they have 21 days to pay the amount or contact you to arrange a payment plan. If you do not receive a response, you will likely need legal advice to determine the best course of action.

You can seek mediation, or, if necessary, you could go to a small claims court. This should not be used as a last resort.

How to write a demand letter

Although writing a letter of request can be difficult, it is possible as long as you include the right information. You don’t have to send the letter in a specific way. If you feel it is appropriate for your situation, you can also send it via email.

These are the details that a letter in demand must include:

  • Your information and that of the debtors (contact details, address, etc.)
  • The date the debt was first incurred and the amount owed
  • Information and dates for any disputes regarding this payment
  • Description of the nature and consequences of the breach
  • Describe any previous reminders or attempts to collect payments.
  • The last due date to settle the sum is
  • Instructions for how to pay (such as your bank details)
  • You should not pay the consequences (intended legal action).
  • Your signature
  • Attach copies of any relevant documents (e.g., the invoice)

A letter of demand should be professional in tone and detail. Do not vent your frustrations now. Get personal or emotional.

It is not a good idea to make threatening statements. If you end up in court, a badly written demand letter can seriously damage your case and reputation.

If the situation is managed well, you might even be able to come out of it without any bitter feelings.

Is it a good idea for a demand letter to be sent by email? It is possible to send your request letter via email. However, there are no rules. For formal documents, most are sent by registered mail or hand delivery, so there is no doubt that they have reached the correct person. It doesn’t matter how you send it; it is important that they are read and considered seriously.

What’s next?

Although you might be ready for battle, you never know what your letter will be received. There are three outcomes possible after you have sent your letter of request.

  1. Accept your demand – This is where the debtor shows up at the party and meets your demands.
  2. A counteroffer is when the debtor accepts your demands, but not all of them. Negotiations begin.
  3. Refusal – This is the worst-case scenario if your terms are not accepted. You will need to take legal action.

It is not difficult to chase bad payers. While you can do the job yourself, hiring a professional might be more efficient. This way, you won’t have to worry about legalities and writing your letter.

You could also outsource credit control, even though this is an option. This will ensure that all your credit control tasks, such as follow-ups and payment reminders, are handled immediately.

Outstanding debt

It is important to get paid. Cash flow is essential to your business. There’s nothing worse than not getting paid. You worked hard to build your business and deserve the money you owe.

Although it might not be easy to send a demand letter, it can save your company.