Business Collections: 4 Critical Times to Contact an Attorney

attorney for business collections

Every business depends on reliable payments to maintain healthy cash flow. However, when invoices aren’t paid on time, collections of the outstanding balances are not always straightforward. Debt collection, especially when it comes to businesses, is regulated by federal and state laws that dictate what businesses can and cannot do to recover what they’re owed.

Key Legal Issues in Business Collections

Businesses must understand several important legal issues with collections. They should also understand that working with an attorney can become essential if routine collection efforts fail or disputes escalate.

  • The Fair Debt Collection Practices Act (FDCPA) – The FDCPA prohibits abusive, deceptive, and unfair debt collection practices. Use of any unlawful collection tactics, such as harassment, misrepresentation, improper interest rate changes, or failing to follow required notice provisions, can lead to legal penalties.
  • State Laws – Illinois also has specific laws that businesses must follow when it comes to collections. These laws set rules for collecting on past-due accounts and prohibit deceptive or unfair practices, as well as define parameters for businesses that are filing lawsuits.
  • Statutes of Limitations – Every debt has a “statute of limitation,” which is the maximum period of time after a debt becomes due that legal proceedings can be initiated to collect it. Attempting to collect on debt that has reached its statute of limitation can lead to legal complications.
  • Bankruptcy – When someone declares bankruptcy, businesses are not allowed to continue actions to collect on their debt owed. Continued attempts can result in severe penalties from the bankruptcy court. Understanding the different types of bankruptcy and how they impact your ability to collect is vital.

How We Can Assist in your Business Collections  

Even with the best intentions, collections don’t always go smoothly. This is where an experienced attorney with extensive knowledge of fair collection practices can be so important. At Churchill, Quinn, Hamilton & Van Donselaar, Ltd., we can:

  • Ensure your business is compliant with federal and state laws
  • Navigate disputes and negotiate settlements
  • Initiate legal action, such as lawsuits or judgments
  • Help navigate situations that involve bankruptcy proceedings
  • Provide invaluable expertise for complex cases
  • Save your business significant time, stress and financial losses from improper collections practices

If your business has collections that are stalling or proving to be more difficult than you thought, reach out to our office for the legal assistance you need to move forward without putting the business at risk. Call 847-223-1500 to schedule a consultation.