Frequently Asked Questions

How much do you charge?

We are confident in our ability to be paid by results and as such, for our Commercial debt recovery service, we operate on a no-collection no-fee basis. We typically charge a commission rate of 15% on monies recovered.

What is your success rate?

Very good, after all, we get paid by results, and we’ve been trading for well over 20 years!  We pride ourselves on above average collection rates in the industry, and we have clients in located worldwide and in all industry sectors.

When should I start debt recovery action?

If there are warning signs, such as broken promises, worsening payment patterns, refusing to talk to you, then it pays to take action as soon as possible, otherwise you may find that you were too late. If a debtor does not have enough money to pay all their invoices, they will usually pay the people that initiate debt recovery action. Don't wait until the money runs out. Once you employ our services they will realise that it is in their own interest to resolve the matter and also that you are serious about recovering your money.

Is there a limit on the number of referrals?

There is no limit on the number of debt recovery accounts that you can instruct us on. For bulk debt recovery submissions, we can usually offer a reduced commission rate.

Can I chase payment without losing my customer?

There is never a guarantee, but we at Collection House always use a polite but firm approach. More often than not, when a customer pays an overdue debt they usually continue to do business with the client. Moreover, you would be surprised how often the same debtors arise!  

Ultimately, you do have to consider if a client is worth keeping if the continually renege on promised payments. Ask for your payment, get a payment date, set a deadline for payment, and follow up. Be consistent and don’t let it go on and on.

What do you need to start debt recovery action?

In the first instance we simply need your debtor’s name and address and the best way to contact your debtor (e.g. phone number, e-mail address); a note of what is outstanding and what the debt relates to (a copy of the invoice or a statement will usually suffice). We may require further information, such as a copy of any contract in place which might affect the way in which we try to recover the debt (for example, special terms and conditions or payment terms).

My debt is disputed, will you still take action?

Once we are in receipt with full details of the dispute, we will work to resolve the dispute directly with your customer with our experience in negotiation and mediation. 

My debtor is overseas, can you still collect?

Yes. We have collected money from many overseas companies, from The Americas, to the Middle East and Australasia. 

Can I charge late payment fees? 

Yes. If you have a clause relating to late payment in your terms and conditions, you must charge compensation in line with the amount stated. If you do not have a late payment clause in your terms, then you have a statutory right to charge your clients interest and late payment fees under the Late Payment of Commercial Debts Act 1998 (as amended). 

The amount of compensation you can claim is listed below. Collection House will add any applicable interest and late payment fees when acting on your behalf.

• For invoices up to £999.99, you can claim £40

• For invoices from £1,000 – £9,999.99, you can claim £70

• For invoices over £10,000.00, you can claim £100

Do I need to tell my clients that I will be claiming late payment fees and compensation?

You don’t have to tell your customers that you will claim Late Payment interest and compensation if they fail to pay on time. However, it is good practice to tell them in advance of your intentions, should payment be made late. You could ensure that your terms and conditions include a late payment clause as well as adding warnings on your invoices and statements 

What happens to late payment fees that are collected?

They are yours to keep! Any late payment fees and compensation that we collect will be forwarded to you, our client. Therefore, it is possible for you to make a profit from instructing us.

An example of a £5000 debt with the Bank of England base rate at 4%:

The annual statutory interest on this would be £600 (5000 x 0.12)

The daily interest would be £1.64 (£600 / 365).

Multiply the daily interest by the number of days the payment is overdue by to calculate exactly how much is owed.

A debt of this value would also attract compensation of £70

Can I claim reasonable costs?

As stated above you can claim a fixed sum (compensation) depending on the amount owed.

You can also charge any reasonable additional costs of recovery where they exceed the basic compensation rate.

Can I track my accounts with you online?

Yes. You can track your accounts online to see the latest progress via our secure 24/7 online portal.

How long does it take to collect a debt?

Sometimes it can be very quick – on receipt of one of our letters of claim or after we have spoken to the debtor – at other times it can take a bit longer. It will depend on a number of factors: age of debt, industry, debtor’s financial status, or if the debt is disputed.

Who makes the decision to take a legal action?

If after all our efforts the debtor has still not paid then you may wish to take the matter further by taking legal action. We work with an experienced firm of solicitors that can act up your behalf; in fact, given the amount of legal cases we refer each day, we are rewarded with reduced legal rates which result in a cost saving to you.

My outstanding debt is old, can I still take action?

Under the Limitation Act the life of a debt is 6 years. However the life of a debt can be prolonged as it includes 6 years since a payment was made or from last contact with the debtor. The best way will be for us to take a look and we can advise.

My debtor has disappeared, what can I do?

We offer a full tracing and investigation service.

Can you provide legal advice?

We use external solicitors in England and in Scotland, and we will be happy to discuss any debt related questions you may have and can advise you if we believe legal action is necessary.

What if the debtor has entered a formal insolvency?

If the company is in liquidation/receivership the chance of recovering the full balance outstanding is greatly reduced. However, we can act on your behalf and deal directly with the Official Receivers/Liquidators in order to obtain the best possible outcome.

Instruct us today. Just drop us an email at response@collecitonhouse.co.uk or call 01225 762004