Frequently Asked Questions
Debt Recovery Costs
Yes! The Government’s Late Payment of Commercial Debts Act allows creditors to claim the cost of recovering a debt. We add late payment interest and compensation to the debt amount to cover our fee, and then recover the total amount from the debtor, we then forward 100% of the original debt to the creditor.
No! We will never ask you to pay any upfront costs and there are definitely no hidden charges. Advocate’s service works on the basis that we will successfully recover the full amount of the outstanding debt plus our fee from the debtor. In the unlikely event that we are unsuccessful in recovering a debt our services are completely free of charge.
The late payment interest amount will depend on how long the debt has been outstanding and the late payment compensation amount will be £40, £70 or £100 depending on the size of the debt.
61% of cases are settled in full following an initial demand letter and in most of these cases late payment interest and compensation will fully cover our fee.
Where late payment interest and compensation does not fully cover our fee, we will add recovery costs to the amount to be paid by the debtor. Recovery costs will vary depending on a number of factors, including the age, size and nature of the debt along with the complexity involved in recovering the debt. Typically the recovery costs charged to the debtor are 5% of the debt owed.
Interest, compensation and where applicable recovery costs are legally payable by the debtor under late payment legislation. We would advise the debtor that payment of the original amount is not accepted and the full amount including interest, compensation and where applicable recovery costs is now due. Alternatively you may decide to accept payment of the original amount after deduction of our fee equivalent to the late payment charges.
Debts We Will Consider for Recovery
No! Our knowledge, experience and expertise is in business to business debt recovery.
Yes! We would consider any debt over £500.
Yes! We will consider cases where the debt is up to 6 years old. However, the older the debt the more difficult it will be to recover.
Yes! Our team are experienced is dispute resolution and work closely with both parties to achieve a satisfactory conclusion, whilst recognising that it is your money they are working to recover.
If the debtor is in liquidation it is not possible to make them pay. The first line of enquiry should be to ensure that they are actually are in liquidation or receivership. It is not uncommon for companies to inform creditors of administration proceedings, in the hope that they will write the debts off, while they in fact carry on trading. It’s always worth checking.
The Debt Recovery Process
Our approach to commercial debt recovery and the methods and disciplines we practice produce outstanding results, we have a pre-legal success rate of 93% in the cases we accept. No matter the nature, size or age of the debt, if the debtor is solvent and the debt is undisputed, we will recover it!
All we need to start the recovery action are some basic details about the debtor and the amount outstanding, the trading name, address and a telephone number, along with a copy of the invoice. We can even carry out a basic search if you don’t know all of these details. Any additional information is helpful and this could be in the form of copies of statements, delivery notes or correspondence with the debtor, email addresses and mobile numbers or any known reason why the account has not been paid.
We will send you by email, an Account Referral form which will capture most of the details we require. It should be completed and returned with a copy of the invoice(s). Email is our preferred method of document delivery, email@example.com. If you would prefer to fax documents the number is 0117 9074701. Copy documents can be sent by post, but please do not post original documents.
Pre-legal processes are completed in 14-21 days, however the debtor will usually make contact within 7 days to start discussing payment. We have successfully completed some cases in as little as 48 hours, whereas some disputed cases have taken considerably longer to recover. The majority of cases are paid in full within 2 weeks, with the few remaining cases either in litigation or written off within 4 weeks.
We will always negotiate on your behalf with the express aim of recovering the debt in full, and may require further information from you to settle a dispute. Even if initial contact from the debtor is to raise a dispute, dialogue has been opened and once we start discussing the case with the debtor, swift settlement in full usually follows.
Monies recovered and collected will be transferred to the Client on the same working day that the monies are available as cleared funds in Advocate’s Client account.
We will always endeavour to recover the whole debt in full. However if we can see that the debtor does not have the means to pay in full we will negotiate settlement of the debt by instalments. If you agree to the instalment plan we will undertake to collect each instalment when due.
You will receive each instalment as it is collected, normally on the same working day that the payment is available as cleared funds in Advocate’s Client account.
International Debt Recovery
Yes! We do accept cases like this. However, it does depend on which country you are based in. Please contact us and we’ll let you know if we can help.
By law, if a service is not “Not Exported” VAT should be charged. Our service is carried out in the UK therefore you would be charged VAT.
Debt Recovery Litigation
No, we are commercial debt recovery specialists. We work closely with an associated solicitor to issue legal proceedings on your behalf. Alternatively we can pass on your case file to the solicitor and you may deal with them directly.
You do! In the unlikely event that we have been unsuccessful in recovering a debt and legal action remains the only option available, the final decision to proceed is yours. We will of course advise you and would only ever recommend legal proceedings in cases where there is a reasonable possibility of securing a judgment, and more importantly of actually being paid.
By the time we reach the point when you have to decide whether or not to instruct us to issue proceedings, we will have enough information about the debtor, their financial position and any assets they may own to be able to advise you accordingly. If we believe that securing a judgment would not result in payment, we would recommend the debt be written off.
Yes! In the unlikely event that we have been unsuccessful in recovering a debt and the Client then decides to progress to litigation, legal costs will be the responsibility of the Client. We will supply full details of the costs involved in taking the most appropriate course of legal action. Court fees and most legal costs can be added to the claim and are paid by the debtor if the action is successful.