How to Recover A Debt From an Individual? – Helpful Guide

11th August 2023

Looking for advice on the best method for how to recover a debt from an individual? Look no further than UK debt resolution giant DCBL.

We have produced this helpful guide to help you understand how to correctly recover a debt to you or your business from an individual

Dealing with unpaid debts from individuals is a common concern for businesses as well as individuals.

Around 58% of SMEs are currently waiting on money which is tied up in unpaid invoices from individuals and businesses, according to research from Barclays.

Whether you’ve lent money, provided goods or services on credit, or extended a helping hand, it’s important to know how to recover debts effectively.

There are many reasons why an individual may owe you money, and this could be from anyone such as a friend, family member or a colleague.

DCBL are specialists within the debt resolution sector and are here to help with recovering debts from individuals.

How to Recover A Debt From an Individual – Top 5 Tips

At DCBL, we are focused on providing an ethical yet effective debt recovery solution to our clients.

Whether you are owed money from a sole trader or need to know how to recover a debt from an individual, we have got you covered.

There are a variety of methods available when it comes recovering the amount owed to you. This guide offers the most practical steps that prioritise communication and amicable solutions to help you navigate the process smoothly.

Open Communication

Starting on the right foot is key. Begin by reaching out to the debtor through a friendly reminder letter, email, or even a call.

When an individual or sole trader owes you money, it is important to maintain a good relationship with the debtor.

After reaching out to the debtor, politely explain the outstanding debts owed, the terms agreed upon, and the impact it has on you.

Encourage an open dialogue to understand any reasons behind the delay and work together towards a solution.

No debt recovery case needs to escalate to dispute resolution or legal proceedings.

Negotiate New Payment Terms

Life is full of surprises, and circumstances can change unexpectedly.

If the debtor is facing financial challenges, consider discussing new terms that make it easier for them to repay.

This could involve extending the repayment period, reducing interest, or finding a middle ground that benefits both parties.

Whilst taking action to recover the debt is important, it may be beneficial for both parties if you can sort new payment terms.

The debtor will be happy that their circumstances are taken into account and you will periodically recover money owed to you.

Offer Partial Settlements or Payment Plans

In some cases, the debtor might not be able to pay the full amount. Instead of pushing for the entire sum, consider accepting a partial settlement.

This allows you to recover at least a portion of the debt without straining the debtor further.

Most debt recovery processes when recovering money from an individual will include partial settlements.

When an individual, rather than a business, owes money, it may be easier for them to pay any unpaid invoices this way.

Another approach is to propose a structured payment plan that breaks down the debt into manageable instalments.

This provides the debtor with a clear roadmap towards settling the debt without overwhelming financial burden.

Late payment may have occurred due to not having enough time to pay the balance, so a payment plan may prove useful to recovering your debt in full.

Legal Action as a Last Resort

If other options don’t yield results and the debt is substantial, you might consider legal action to recover the money.

Many people think that taking court action or enforcement action when they are owed money is a good thing. However, this should be your last resort, as court proceedings and debt recovery solicitors can be time-consuming and costly.

Instructing DCBL to Recover A Debt From an Individual

If all else fails, you can consider hiring a debt collection agency such as DCBL.

While always speaking to your debtor first is recommended to understand their situation, choosing DCBL should be the only step after this.

A debt recovery agency will specialise in recovering debts for individuals and businesses. As each debt recovery case is different, they will have specific strategies to encourage debtors to pay.

DCBL are industry-leaders and have over 20 years of experience in debt resolution and high court enforcement.

We specialise in ethical debt resolution and provide debtor tracing for those who cannot locate their debtors.

Whilst we do charge a fee to recover debts, we will take the burden of debt recovery off your shoulders. This will help you to focus on the important things, such as running your business or living your life.

Like other agencies, we do not just send out one debt recovery letter and hope for the best. Our debt recovery process is backed by over 1,800 5 star reviews on Trustpilot.

Click here for a free quote to recover your debt.

How to Recover A Debt From an Individual – Conclusion

When owed money from an individual, it doesn’t have to be a daunting process dominated by courts and legal action.

By focusing on open communication, negotiation, and alternative solutions, you can increase the chances of recovering what is rightfully owed to you.

Remember, every situation is unique, and a compassionate and flexible approach can lead to a resolution that benefits both parties involved.