As a creditor, it is vital that you understand the limits of the law when confronting payment delinquency. When it comes to contacting delinquent clients, the Fair Debt Collection Practices Act, or FDCPA, governs much of this.
One of the provisions of the Act is that if a delinquent client contacts you in writing and tells you to stop contacting him or her, you must cease and desist. However, according to ConsumerFinance.gov, there are still other actions that you can legally take in the pursuit of your rightful payments.
What must the cease and desist letter entail?
First of all, it absolutely must be a physical letter in writing. A delinquent client asking you not to contact them over the phone or through email does not suffice.
Your first action as a creditor in this situation should be to respond in writing to say that you will no longer contact the delinquent client. However, you may tell the delinquent client that this means you can take legal action against him or her for the lack of payment.
What happens next?
By law, creditors must provide delinquent clients with the name of the creditor, how much the delinquent client owes the creditor, information about the delinquent client having the ability to dispute the debt and that the delinquent client may contact the original creditor if you are not the original owner of the debt.
Once you have done this, there are additional options available to you. You may choose to file a lawsuit against the delinquent client, or make negative reports to one of the three credit bureaus.