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Making
the decision to file a lawsuit can be a difficult one. Here are
factors to consider when your debtor won't pay:
How large must your claim be?
A small claim will not be worth the expense in court costs,
travel time and attorney's fees to pursue. The size of the claim
you send to collection depends on the amount of money you are
willing to spend for court costs. I do not recommend filing suit
unless your claim is over $1000.
How much will my lawsuit cost?
Court costs are your biggest concern. The court costs to file
suit, serve the debtor with summons and issue post judgment
proceedings to collect the debt will cost $200 to $400.
Court costs include fees that you will be required to pay the
court to file your lawsuit, have summons served on your debtor
and for garnishing your debtor's wages, bank account or other
assets. You may also have to pay detective fees and asset
searches and in some instances, appearance attorney fees in
outlying counties to appear and take judgments. We do not
outsource cases.
Do you have good documents?
Do you have sufficient documents to prove your case? Necessary
documents include contracts, agreement confirmation
letters, invoices, statements, delivery receipts, etc. If you
don't have complete documentation, you may not be able to win
trial if the debtor disputes your claim.
Do you have a witness?
If your case goes to trial, a person who has knowledge of the
events must be available to present your case. If the person who
handled the transactions is no longer working for you or cannot
come to court to testify, you can substitute a person who is
familiar with the debtor's file. This could be the collection or
credit manager.
Does your debtor have assets?
If you don't know where your debtor works, banks or owns
property, try to locate assets before you invest money in court
costs. Hiring a detective to locate assets can save you money.
If you can't locate assets, you can collect by bringing the
debtor to court to testify about his assets.
Decide to file a law suit is based on a hard examination of your
chances to win. If you assess your documents, witnesses and
costs before you file suit you will strengthen your chance of
winning in court and collecting your debt. My initial
consultation is free. I will be happy to review your documents
and help you assess your case.
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