Collection letters first warning of collection procedures

After your reminder letters, when it's obvious there's no action regarding payment, you may have to institute collection procedures.

However- There's no harm in sending your first warning as a somewhat more strongly worded reminder.

When advising regarding possible collection procedures:

Ensure compliance with law
Do not use threatening terminology
State your intent to commence collection
Remind the client payment will cease any collection actions

This example is of a first warning of collection procedures after two previous notices.

Example

Business letterhead

Addressee

Your reference
Our reference
Contacts

Dear….

Overdue account- First notice of intent to commence collection procedures

If you have already paid this account, please disregard this notice.

I refer to our two previous notices regarding overdue account detailed below.

Please note that our policy is to institute collection procedures upon failure to respond to two reminder notices.

As no response has been received to previous notices, collection procedures for the account detailed below, (including overdue account charges), will be instituted if no response to this notice is received within one calendar month of the date of this notice.

Goods purchased:
1 Mega Breeze Air conditioner       $699.90
1 Persian Rug, Axminster               $150.00
1 Delivery                                      $ 40.00

Amount due:                                 $889.90
Overdue account charges            $266.96 (15% per month x 2 months)

Total amount payable                 $1156.86

Important: If you are having difficulty paying this account, it may be possible to schedule payments, or arrange a line of credit, or some other method of addressing your needs.

Please contact us on the above phone number or email if you require further information.

Yours sincerely
Sign
Title
Date

Disclaimer

Please note:

This text is intended for advisory and guideline purposes only.

Any business letter can become a legal document, so check your content properly before issuing.

Any executable or statutorily defined document should be checked for compliance with legal requirements, and you should seek legal advice regarding its contents.