Collection case

A debt collection case refers to a case that is taken under consideration by a debt collection company, a lawyer, or the creditor themselves. The purpose of a debt collection case is to recover one or more unresolved financial matters from a debtor.

The debt collection case originates when a debtor fails to settle an invoice, debt or other financial matters. If the creditor then decides to collect the amount, it becomes a debt collection case.

Who can handle a debt collection case?

As a creditor, there are several options for handling the debt collection case.

You can choose to handle the debt collection case yourself, which is often referred to as "self-collection". In this situation, you handle the entire process yourself - from sending reminder letters, collection alerts, phone calls to any repayment arrangements.

If you prefer not to manage the debt collection case yourself, you can enter into an agreement with an authorized debt collection company or a lawyer specializing in debt collection (so-called debt collection lawyer) to manage the case on your behalf.

Finally, it is possible to seek assistance from the enforcement court to handle your debt collection case.

It's important to note that only authorized debt collection agencies and lawyers are allowed to handle debt collection cases on behalf of others.

How a debt collection case proceeds

While no two debt collection cases or debtors are identical, the process for debt collection cases can be described in general terms to give a sense of how they typically progress. However, it's important to understand that the process can vary based on the unique circumstances of each case.

If a debtor pays immediately after receiving the collection notice, the case is closed at this point. However, if the debtor chooses not to pay, the case may progress through a number of steps before it is eventually resolved. In some cases, debt collection cases can also end without resolution, for example if the debtor passes away or is declared bankrupt.

Despite this variation, it's possible to outline a general process for debt collection cases:

Collection notice / Demand letter: All debt collection cases begin with a collection notice or demand letter, where the debtor is informed of the outstanding debt. The debtor is given 10 days to pay the amount to avoid an actual collection process.

Debt collection actions: If payment is not received within 10 days of the debt collection notice being sent, actual debt collection actions are initiated. These may include phone calls to the debtor, physical attendance, adding interest, collection fees, sending reminder letters, reminder fees or setting up an installment plan.

Judicial debt collection process: If the previous steps do not result in payment or response from the debtor, the case can escalate to a judicial debt collection process using the bailiff court.

It is important to consider the unique situation of each case, but this description can serve as a general guide.

Are all debt collection cases resolved?

While a large proportion of debt collection cases are fortunately resolved - either by full or partial payment of the outstanding amount - the reality is that some debt collection cases do not lead to a resolution.

There are several reasons why a debt collection case may not be resolved. Some of the most common reasons include the death of the debtor, bankruptcy, or a financial situation that is so complicated that your claim is drowned out by other debts.

Need help with your debt collection case?

With over 150 years of combined experience in the industry, Collectia has in-depth knowledge of debt collection and effective debt recovery for various businesses. If you are facing debt collection challenges, we are here to help. Don't hesitate to contact us for a no-obligation conversation about how we can help you and your business with debt collection.