The filing of a lawsuit can be used to seek an overdue payment on a debt. Yet a plaintiff could exhaust time and money by pursuing such an action. The same plaintiff might have gotten better results by writing an effective demand letter.
A demand letter can serve as a way to get paid, without going to court.
It can do away with the need to file a lawsuit. It demonstrates a readiness to pursue a less aggressive approach.
Tricks to use, in order to increase the letter’s effectiveness
• Explain the reason for the request for money; why does the debt exist?
• Be specific about the amount of money owed to the letter’s writer.
• Mention previous attempts to obtain the owed funds; offer details on each attempt.
• If a contract was written, refer to the contract. A copy of that same document does not have to be attached to the demand letter.
• Set a deadline for paying. State what action will get taken, if the requested payment has not been made.
Actions to avoid, when seeking payment from a debtor
The legal system allows for the filing of a lawsuit, if someone has refused to pay a debt. On the other hand, the legal system frowns on other tactics.
• An effort to extort the desired money is illegal.
• Threatening to destroy some of the debtor’s property should not be viewed as an acceptable way to answer a lack of payment.
• Anyone that wants to obtain owed money by legal means should not pursue the making of false or exaggerated accusations.
• Naturally, anyone that wants to proceed according to the law would rule out the possible use of blackmail.
In fact, time could be wasted, if someone that was owed money did try to pursue one of the actions listed above. Time becomes quite valuable, if you have chosen to sue a debtor. You need to meet a filing deadline.
If you miss the deadline, then you have lost the ability to sue the person that is indebted to you. That is why creation of an effective demand letter can save both time and money. Even if you do meet the deadline, you need to spend money, just to get money.
You might decide to pay someone to deliver a summons to the defendant. You do have to pay a court fee. If you hire a lawyer, you must share some of any money that you might win with that same Kitchener. In addition, the lawyer will expect you to cover the costs of things like paying the recorder at the discovery session. It is not cheap. Letter writing could prove less expensive. Think twice before you file a lawsuit.