Making Debts Pay Off – The Importance of Debt Recovery in an Economic Crisis
With reports from CNN of a global coronavirus recession, and the Financial Times confirming a huge slide in the value of the pound, it is no real surprise that the Chancellor of the Exchequer, Rishi Sunak, has announced a £350 Billion ‘lifeline’ for the economy, in an effort to prevent further economic downturn.
Even aside from the current crisis, recent statistics confirm that the average total debt per UK household in 2019 rose to £60,213, with the average credit card debt per household standing at £2,594. According to the Office for National Statistics, the UK’s total household debts stood last year at an astonishing £120 Billion.
Why should my business be concerned with existing debts?
Businesses with overdue invoices and other existing debts can often be left struggling with complex decisions as to different avenues for enforcement. Whilst the Government has rolled out various measures over the last few years to simplify money claims, it can remain a daunting prospect for many would-be claimants, and accordingly many businesses simply write off debts as ‘bad debts’, without obtaining advice and seriously considering the possibility of enforcement.
In these uncertain times, it is not clear whether ongoing work will be able to be continued, whether contracts will be cancelled, and whether future work will be forthcoming over the next few months as we weather the economic storm. As a result, it is good business practice in times like this to ensure that existing debts are paid.
What options are available to enforce my existing debts?
Many creditors are justifiably concerned about the enforceability of debts against both individual and corporate debtors, given the economic climate. Therefore, before beginning the debt recovery process, it is vital to obtain as much information and evidence as to the debtor’s ability to make good on their debt before spending any time on recovery.
Once it has been established that enforceability is worthwhile and proportionate, a number of options are available including:
- Obtaining a writ of control over a debtor’s assets
- Registering a legal charge against the debtor’s property
- Obtaining an attachment of earnings order
- Negotiating a payment plan with a debtor
How can Ellis Jones help me recover my existing debts?
At Ellis Jones, our Debt Recovery Solicitors are highly experienced in the field of debt recovery and enforcements, working closely with Tracing Agents and High Court Enforcement Agents to deliver a turn-key solution for all of our clients’ debt recovery needs.
From conducting initial research into the likelihood of successful and proportionate enforcement, to dealing with the intricacies of the court proceedings, to settlement negotiations and potentially the instruction of Bailiffs. Our Debt Recovery team has the skills and experience to give your business the best possible chance at recovering existing debts, and providing a much needed cash-injection into your business during a time of crisis.
If your business has existing and outstanding debts and could benefit from our Debt Recovery expertise, contact our Dispute Resolution Team by calling 01202 525333 or by emailing Lauren.Day@ellisjones.co.uk to discuss your needs and how we may be able to assist you.