Debt Recovery – Formal Letter of Demand

In circumstances where there is a debt owed to you and you have tried multiple attempts to recover the debt but failed, you need to consider issuing the debtor a formal letter of demand. A letter of demand is often viewed as a solution of last resort as there are chances of damaging the relationship (eg. business relationship) between the creditor and debtor.

What is a Letter of Demand?

A letter of demand is concise letter that demands for the outstanding payment. This letter will specify the funds owed for the services rendered by creditor, circumstances leading to this letter being issued to the debtor (eg. multiple failed attempts to recover the debt owed) and consequences if payment is not made by the debtor by a stipulated date.

Every now and then there are companies or individuals who owe a debt to another party, know that there is a debt owing but refuse to make payment on time as they do not think the other party is going to do anything about it. This often happens to companies or individuals who have a close business or individual relationship with the debtor. In these circumstances, a letter of demand especially one that is issued by a lawyer oftentimes prompts these parties to resolve the dispute sooner rather than later.

Why Should I Engage a Lawyer to Write My Letter of Demand?

Lawyers are highly experienced in this area of practice. Lawyers are legal experts at handling debt recovery matters and letter of demands. Thus, it is more likely that they are able to cover all areas in their letter, leaving no gaps or room for other interpretations. It is often the case where debtors are more likely to pay if a letter of demand is issued by a lawyer as they do not wish for any legal action to be brought against them. It can also help set a strong deterrent for failed dealings and perhaps prevent the same impropriety in future.

If you would like us to enquire about writing a letter of demand or if you have received a letter of demand and would like to find out more about your rights and options, Straits Lawyers are here to help. Simply send us an email at info@straitslawyers.com or give us a call on 8410 9069 to arrange an appointment for an online interview.

Please note that this article does not constitute legal advice and Straits Lawyers will not be legally responsible for any actions you take based on this article.