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Bad Debt Collection Letter

Bad Debt Collection Letter Template for Australia

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Key Requirements PROMPT example:

Bad Debt Collection Letter

"I need a Bad Debt Collection Letter for collecting an overdue payment of AUD 45,000 from a commercial client who has been unresponsive for 90 days; this is the final notice before legal action."

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Document background
The Bad Debt Collection Letter is a crucial document in the debt recovery process, typically used when previous attempts to collect payment have been unsuccessful. This document is designed to comply with Australian legislation, including the Australian Consumer Law, Privacy Act 1988, and the ACCC/ASIC Debt Collection Guidelines. It serves as a formal written demand for payment and is often the final step before legal action is considered. The letter must include specific information such as debt details, payment terms, and the consequences of non-payment while avoiding any harassment or undue pressure on the debtor. It's essential that the content and tone remain professional and comply with all relevant Australian regulations regarding debt collection practices.
Suggested Sections

1. Sender Details: Full business name, address, contact information, and any relevant license numbers of the collecting entity

2. Date: Current date of the letter

3. Recipient Details: Debtor's full name and current address

4. Subject Line: Clear identification of the letter's purpose - 'FINAL NOTICE: Outstanding Debt Collection'

5. Debt Information: Details of the original debt, including account number, original amount, interest accrued, and current total

6. Payment Demand: Clear statement of the amount required and payment deadline

7. Payment Methods: Available payment options and detailed instructions for making payment

8. Legal Compliance Statement: Statement of compliance with debt collection laws and regulations

9. Consequences of Non-Payment: Legal and professional description of next steps if payment is not received

Optional Sections

1. Previous Communication Reference: Reference to prior attempts at collection, used when multiple notices have been sent

2. Payment Plan Options: Include when willing to offer flexible payment arrangements

3. Dispute Resolution Process: Information about how to dispute the debt, included when required by jurisdiction or circumstances

4. Interest Calculation Breakdown: Detailed breakdown of how interest has been calculated, used for larger debts or when specifically requested

5. Third-Party Authorization: Information about acting on behalf of the original creditor, used when collecting as a third party

Suggested Schedules

1. Statement of Account: Detailed breakdown of the debt, including original amount, interest, fees, and payments made

2. Copy of Original Agreement: Copy of the contract or agreement that led to the debt

3. Payment History: Record of all payments made and missed payment dates

4. Interest Calculation Schedule: Detailed breakdown of how interest has been calculated and applied

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok³ÉÈË°æ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

alex.den.21@genieai.co
Relevant legal definitions




















Clauses




















Relevant Industries

Financial Services

Retail

Professional Services

Healthcare

Construction

Manufacturing

Telecommunications

Utilities

Education

Real Estate

Insurance

Small Business

Relevant Teams

Finance

Accounts Receivable

Credit Control

Legal

Collections

Risk Management

Administration

Customer Service

Operations

Relevant Roles

Credit Controller

Accounts Receivable Manager

Collections Officer

Financial Manager

Credit Manager

Debt Recovery Specialist

Accounts Manager

Finance Director

Credit Risk Manager

Business Owner

Financial Controller

Debt Collection Agent

Industries







Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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