Credit Applications & Contracts: Prevent Debt Issues Before They Start

When debt collection is handled before the debt actually becomes a problem, you’re already a step ahead of the game. One of the best ways to accomplish this is to have an arsenal of well-prepared, strong as oak documents such as a credit application or contract. Not only do these documents protect your best interests in collection issues, they also give you the legal power and necessary information needed for your experienced debt collection attorney to pursue your debts, especially if you are forced to file suit.

While a contract is more specific in terms of the business exchange, a credit application may include the following:

  • Interest Rate for Late Payment: Establish a minimum default interest rate should the client submit late payments.
  • Banking Information: Know where the money is in case you need to find it.
  • Attorney’s Fees Clauses Which Reduce or Remove Judicial Discretion
  • Jurisdiction: This dictates what court will hear the case should it go to suit.
  • Company Owner’s Contact Information: All contact information needs to be correct and up to date, including name, phone numbers, email, and address.
  • Personal Guaranty: When possible, a personal guaranty is a preferred piece of information. This way you are protected should assets dwindle or disappear.

No matter the business relationship, every client should submit a credit application or a signed contract that outlines the payment terms, rights, remedies and what is expected from each party. It is critical that these documents are well-prepared in order to effectively and efficiently collect debt if the need should arise.

If you need the assistance of a knowledgeable, skilled debt collection attorney in Massachusetts to prepare or review these documents for you, please contact our office today. Our 30 years of experience in preparing contracts and credit applications has helped many businesses prevent debt issues before they start or assist in litigation cases. For more information on our legal services, please contact us at (508) 620-6900 or email alanmcohen@collections-law.com.