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The Ins and Outs of Collecting Debt

In the legal profession we refer to two ways of collecting debt. We call these two ways “soft” collections and “hard” collections. Debt collectors will mostly try and collect your debt the “soft” way before having to revert to the “hard” way. What follows is a breakdown of the two ways that debt collectors go about collecting your debt.

In the first place, “soft” collections means to not wanting to revert to harsh and formal court procedures. In this manner of debt collection, debt collectors often try to contact the debtor personally and find out why they did not pay their debts and whether they want to make an arrangement to pay off the debts or not. This manner of collecting debt can be very efficient as debtors can feel that we want to help them and that we are not out to merely take everything they have, by contacting them directly they may feel inclined to make payment.

This manner of collections also has a down side. Debtors promise to pay again and again and then they don’t keep to their promises. This leads to the collection process being unnecessarily delayed and creditors beginning to become impatient. This is then when the last step of “soft” collections takes place and a formal letter of demand is sent to the debtor stating that in the event that they do not pay the full amount owing within a specific time frame, that a formal summons will be served on them.

Now we get to the “hard” way of collecting debt. This starts by drafting a summons stating that the debtor owes a certain amount to the creditor and that a civil case is being opened against the debtor due to his non-payment. The document goes to the relevant court to obtain a case number and from there the document goes out to the relevant sheriff to be served on the debtor.

From there the debtor has a certain period of time to defend the matter and if he does not do so within that time, the attorneys for the creditor may apply to the court for a date to have judgment granted against the debtor including legal costs and interest on the amount that is owed.

There is the possibility that the debtor can choose to defend the matter and then the process gets a bit more complicated. Certain documents have to be exchanged between the applicable attorneys – these documents have to be filed at court, specific time frames have to be adhered to and you can never know what the other party is going to do next.

Now that you know a bit more about the process you can see that debt collections aren’t as straight forward as you might think. It could really become a long process and you just have to bear with your attorneys – you can be assured they are doing everything they possibly can to get your money as soon as possible.

TARIEN VAN DYK – CANDIDATE ATTORNEY – LLB(UP)

Burden Swart Botha Attorneys Pretoria

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