Payment default

Payment default is basically about defaulting on any kind of payment - typically an invoice, rent or similar.

The term can therefore be used for all types of non-payments where a debtor has not paid a creditor on time.

In practice, however, the word 'default' is most often used in relation to rent - and non-payment of rent - for both private tenancies and commercial premises and leases.

In this article, we focus on the word default, both in a tenant-landlord situation and in any other debtor-creditor relationship.

What can you do in the event of a payment default?

If you as a creditor find that an invoice sent to a debtor is not being paid, most will start by sending a reminder letter, with or without a reminder fee.

If the debtor doesn't respond to the reminder, you have the option to send two more reminders or send a debt collection notice.

If the debtor still doesn't respond to the debt collection notice, you have the option of self-collection or letting a debt collection agency/lawyer collect on your behalf.

If there is a payment default in connection with a lease, a demand letter/rent demand letter is sent, which acts as a reminder. The demand letter may also include a demand fee.

If the tenant still doesn't respond to your demand, there is a possibility to terminate the lease if the rent is not paid.

Templates for payment default

If you are a creditor and find that a debtor is not paying your invoice on time, you have a wide range of options to take initiatives to get the debtor to pay.

Among other things, you can send reminders (with or without a reminder fee) and debt collection notices(demand letters).

At Collectia, we help small and large companies with their payment defaults on a daily basis through efficient reminder and collection processes.

We've put together a number of great templates you can use as a business if you experience payment defaults - including templates for reminder letters and debt collection notices.

You can find them by clicking the link below.

Get help from a debt collection agency or lawyer for payment defaults

If you are facing challenges with a customer, tenant or borrower defaulting on your agreement, not paying rent or not paying an invoice, don't worry.

Fortunately, in Denmark, there are good options for recovering all or part of the debt - both by collecting the debt yourself (called self-collection) or with the help of a lawyer or a debt collection agency.

Basically, the creditor, lawyer and debt collection agency can do the same thing, but we often see that both lawyers and debt collection agencies have a much more professional approach to recovery than the creditor. This can have an impact on recovery, the speed of recovery and, not least, the chances of getting the money back.

If you need help with debt collection, you are always welcome to contact us at Collectia for a free and non-binding talk.