What are a creditors’ collection options?

| Nov 30, 2020 | Firm News |

As a creditor in Ohio, you need to know what your protections are. This includes your options when it comes to collections. After all, you need access to available remedies if a customer does not pay what they owe.

There are many options to consider when pursuing your collection options. What you pick depends on what you want out of the situation.

Whether or not to take your case to court

Science Direct looks at protections for creditors, including collection options. A first option may be turning to collection agencies or seeking compensation yourself. If you contact the customer directly to demand payment and they refuse, you can turn to regulated debt collection agencies.

You can take the matter to court, too. Generally speaking, experts suggest you only do this in unique situations, though. For example, you may want to take this path if your case involves perishable goods, or if collateral would decline rapidly.

Involuntary bankruptcy proceedings

You can also initiate an involuntary bankruptcy proceeding in some cases. If the court accepts your petition, the debtor must liquidate assets to pay off debts. Barring that, they may need to create a repayment plan that guarantees you get paid back.

You can sue to collect debt if prior attempts fail. If the debtor cannot contest the claim, it entitles you to enforceable judgment. Using this, you can claim enough property to pay off the debt. In most cases, the local sheriff will provide assistance in such matters. You can also claim a lien, such as a mechanics’ lien, a materialmen’s lien or judgment liens. Liens ensure debt repayment.

Any of these options could work in your quest to collect debts owed to you. You just need to decide which suits your needs more.