Understanding your situation
Someone owes you money and has not paid despite informal requests. Common scenarios include:
- Friend, family member, or acquaintance borrowed money and is not repaying
- Client or customer did not pay for services you rendered or goods you delivered
- Business owes you a refund for a cancelled service, defective product, or overbilling
- Former business partner owes you money from a dissolved venture
- Loan you made is now overdue and the borrower is unresponsive
- You won a verbal agreement for payment and the other party is denying it or delaying
- Insurance company is underpaying or delaying a legitimate claim
What you need to prepare
- ✓Documentation of the debt: loan agreement, invoice, email confirmation, text messages
- ✓Record of payments already made (if partial payment received)
- ✓Dates when payment was due and any prior requests for payment
- ✓The full legal name and address of the debtor
- ✓Any acknowledgment by the debtor of the debt (written or recorded)
⏰ Deadline
Statutes of limitations for debt collection range from 3–10 years depending on jurisdiction and debt type. Act promptly - the sooner you send a formal demand, the stronger your position. Give the debtor 7–21 days to respond.
🏛️ Authority
Small Claims Court (for smaller amounts, typically up to $10,000–$25,000), Civil Court, Collection agencies (as a last resort alternative)
⚖️ Legal basis
Breach of contract, unjust enrichment (common law). Promissory note law. Consumer protection acts. Debt recovery procedures vary by jurisdiction.
Expert tips
- 1State the exact amount owed, broken down clearly (principal, any agreed interest, costs you have incurred due to non-payment).
- 2Reference the original agreement or understanding as specifically as possible - date, amount, what it was for.
- 3Mention that continued non-payment may result in interest charges, court costs, and damage to credit rating (where applicable).
- 4If the debtor has made partial payments, acknowledge them and state the remaining balance. This avoids disputes about the total.
- 5Consider whether a payment plan offer could resolve the matter faster - sometimes debtors genuinely cannot pay the full amount at once.
- 6Keep the tone professional and firm. Aggressive or emotional language can undermine your legal position.
- 7For business debts, check whether the company is solvent before investing heavily in recovery efforts.