The Dos and Don’ts of Writing Collection Letters

When writing a collection letter, remember several dos to ensure that your communication is effective and appropriate. Here are some of the most important dos:

Be Clear and Concise

Being clear and concise is essential when writing a collection letter. You want to ensure that the debtor understands exactly what they owe when it's due, and the consequences of not paying. Here are some tips for being clear and concise:

• Use simple language: Avoid using complex terminology or technical jargon. Instead, use simple, straightforward language that the debtor will understand.
• Use bullet points: Consider using bullet points to break up long paragraphs and highlight important information. This can make your collection letter easier to read and understand.
• Avoid ambiguity: Be specific and avoid vague language. For example, instead of saying "We would appreciate it if you could make a payment soon," say "Your payment of $500 is due by May 1st."
• Use short sentences: Long, convoluted sentences can be confusing. Instead, use short, clear sentences that get straight to the point.
• Proofread: Before sending your collection letter, proofread it carefully to ensure no errors or typos could cause confusion.

Be Polite and Professional

Being polite and professional in your collection letter is key to maintaining a good relationship with the debtor and increasing the chances of successful debt recovery. Here are some tips for being polite and professional:

• Use a professional tone: Your collection letter should be written professionally, conveying respect for the debtor.
• Avoid threats or intimidation: Never use threats or intimidating language when writing a collection letter, as this can damage your relationship with the debtor and may even be illegal.
• Address the debtor respectfully: Use the debtor's name and title (Mr., Mrs., Ms.) in the salutation and throughout the letter. This shows that you are addressing them as individuals, not just debtors.
• Acknowledge the debtor's situation: Recognize that the debtor may face financial difficulties and empathize with them. This can build trust and encourage them to work with you to resolve the debt.
• Thank the debtor: Thank the debtor for their attention to the matter and their prompt payment (if applicable). This shows that you appreciate their cooperation and can help maintain a positive relationship.

Be Specific

Being specific is essential when writing a collection letter. You want to ensure that the debtor understands exactly what they owe when it's due, and the consequences of not paying. Here are some tips for being specific:

• State the exact amount owed: Clearly state the money the debtor owes. Include any interest, fees, or other charges that have accrued.
• Provide a due date: Specify the date by which the debtor must make a payment. This can be a specific date or a timeframe (e.g., "within 14 days").
• Explain the consequences of non-payment: Clearly state your actions if the debtor does not pay. This may include legal action, reporting to a credit bureau, or referring the debt to a collection agency.
• Provide details about payment options: If you offer the debtor options for resolving the debt, provide clear details. For example, if you offer a payment plan, specify the amount of each payment and the date it is due.
• Include a timeline: Provide a timeline for any further action you will take if the debtor does not pay. For example, you may specify that you will send a second collection letter in two weeks or refer the debt to a collection agency after 30 days.