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Wilson Cole's Podcast From The Road

Jul 7, 2020

Business can be rough sometimes and you might find yourself not being able to pay someone you owe. We’ve had clients that have had these types of problems in the past. We understand that it’s almost always due to unforeseen circumstances or a cash flow issue. So today Wilson and Samantha will be going over what exactly happens if you owe another invoices and you cannot pay.

What Happens When You Can’t Pay Your Invoices?

Being unable to pay your invoices can be devastating. However, understanding what will happen if you’re unable to pay your invoices will be the first step to finding a solution.

Always Try To Reach out To Your Creditor First and Foremost

Reaching out to your creditor is something we highly recommend if you can’t find a way to fully pay your invoices. Reaching out to your creditor lets you work out a deal to be able to pay the debt over some months or to even reduce the amount of debt that you owe. Usually radio silence isn’t a good idea because it gives your creditor the idea that you might be trying to get away from paying their fees.

The Case Will Eventually Reach Collections if Both Debtor and Creditor Cannot Agree

Usually what happens if both the debtor and creditor are unable to make an agreement, is that a case is then filed at collections. At Adams, Evens & Ross our process typically takes 30 to 45 days which mainly consist of reaching out to the debtor and creditor. We always try to resolve the case before it turns into a lawsuit. The debtor is the last group that the case will go through before reaching an attorney.

What Happens When It Reaches an Attorney

Once the case reaches an attorney, they start checking everything for any mistakes. They ensure that they’re suing the right person. You’d be amazed at how many times a creditor has sued the wrong person. After everything is in order, a demand letter is sent in order to resolve it. If the case isn’t resolved by that point, then it is now a waiting game of 30 to 40 day increments of filings before a court date is set.

Do Not Ignore A Lawsuit and Be Served a Judgement

You want to make sure that you do not ignore the lawsuit. Once a judgement is served the collections company will be able to simply just pull the money out of your account and hand it over to the creditor. They don’t even have to prove that you legally owe the fee either, they just need to prove that the judgement was acquired legally.

Main Takeaways

● If there's a company out there right now that's watching this video in the awkward position of owing more money than they can pay, it does happen. Especially in this economic climate.

● Once we get a judgement, depending on the state, we can pull that money out of the account. If they get served, they do not want to ignore that lawsuit

● They do not have to prove that you owe it, they just have to prove, in most cases that the judgement was acquired legally.