Legal Question in Credit and Debt Law in New Jersey
How old does a bill need to be for it to be sent to collections
I have an advertising client that is now currently in the 30-60 day late colomn for a bill. Typically the company that I work for sends advertisers to collections after the bill is 120 days old. Is there a law that protects the advertiser and gives them a certain amount of time to pay the bill before my company is able to send them to collections? Does my company have the right to send my client to collections before it is 90 days or more late?
1 Answer from Attorneys
Re: How old does a bill need to be for it to be sent to collections
If a payment is late, the creditor can take any lawful action to collect it. When businesses delay in pursuing a claim, it is usually because of customer relations concerns or economics. Overly aggressive collection can lose customers who would otherwise pay - just pay late. Turning an otherwise good claim over to a third-party collector can lose whatever commission is paid. Too much of that and you're doing business for the benefit of the collector.
The discount and purchase incentive schedules of many companies are designed specifically to recover the additional costs imposed by slow-pay customers without losing them as customers. Big businesses tend to be the worst offenders.
See also: http://info.corbettlaw.net/lawguru.htm
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