Extending credit to your clients and debtors is not a choice at times. Most businesses have to do that from time to time. Unfortunately, not all debtors are good debtors. When a debtor refuses to pay the bills or honor a judgment, it is important to take legal action. Working with a New York collection attorney can be a huge advantage. If you are hiring a collection lawyer for the first time, here's what you can expect and need to know.
Collection lawyers are not agencies
Debt collection agencies have a big role to play for businesses across different sectors and industries. They typically deal in the collection of bills, debts, and invoices on behalf of business clients, for which they adhere to certain practices and means. However, an agency cannot work as a lawyer or pretend to be one. Collection attorneys have the legal expertise and understanding of laws and can initiate legal action against a debtor who is hiding assets or has a common name. Your lawyer's job is not to chase the debtor but ensure that judgments are enforced, and your money is recovered.
An overview of laws
There is a statute of limitations that applies to judgments. You are required to collect a judgment within 20 years, which may seem like a lot of time. In the real world, collecting a judgment only gets tougher over a period of time. If judgment debtors refuse to pay, the court cannot do much for you. Your attorney's job is to initiate a detailed investigation to find bank accounts, investments, check land records, and investigate transactions to gather evidence. Your lawyer can get you an information subpoena, which makes it mandatory for the debtor to answer certain questions related to their assets. In some cases, it may make sense to settle a judgment because the debtor is unable to or unlikely to pay the debt. For instance, if your debtor intends to file for bankruptcy, settling the judgment for less is a wise idea. Your lawyer can offer advice on all that.
Not to undermine the role of agencies, but collection attorneys do much more and have the right to take legal action on behalf of the client. If you are hiring a lawyer, ask them if they have worked for similar businesses and what they can do for your company. There is no harm in asking questions related to their work profile.
