Debt collection procedure – what are the stages?

Debt collection is a process carried out by a debt collection agency. It takes various steps to recover the debt owed to the original creditor from the debtor. What happens during the debt collection process? A specialist:

• contacts the debtor, e.g. by telephone,
• explains the situation and the next stages of the debt collection process,
• proposes solutions to ensure that the repayment of the debt is tailored to the debtor’s circumstances.

These steps are intended to clarify the matter and find a solution acceptable to both parties

Are you wondering what the stages of debt collection look like? Although the process may seem complicated, it is worth familiarising yourself with its individual stages and checking what actions are taken at each one.

Amicable debt collection is the first and most commonly used stage of debt recovery. Its main aim is to resolve the matter at the pre-litigation stage. The debt collection agency contacts the debtor to:

• inform them of the debt incurred – a specialist may, for example, call or send a letter,
• agree on a possible repayment date.

These activities are conducted in a professional manner and with a view to reaching an agreement. As a result, it is often possible to resolve the matter without taking it to further stages.

If the debtor wishes to settle the debt, the next stage of the debt recovery process will be to establish repayment terms. The most important thing here is to find a solution tailored to the debtor’s current financial situation. In practice, this may involve:

• setting a payment deadline,
• spreading the debt into instalments and signing a settlement agreement
• establishing a personalised repayment schedule.

This approach allows you to get your finances in order and avoid further consequences associated with non-payment. At EOS Poland, we treat you as a partner. We want to work with you to develop a plan that will enable you to get out of debt in a way that suits your circumstances. That is why we approach each case individually, to fully understand your needs.

What might happen if, despite prior arrangements, repayments are not made according to the schedule or contact cannot be established? In that case, the creditor may take further steps, such as sending a demand for payment. In this, they will inform you of:

• the obligation to pay,
• possible further steps if the matter is not resolved.

If the matter still cannot be resolved, the next stage may be court proceedings. The court will review the documentation gathered in the case and may issue a ruling Only after obtaining the relevant ruling and an enforcement order can the case be referred to a bailiff.

The duration of the debt recovery process depends on many factors, including:

• the stage of the debt recovery process,
• the amount of the debt,
• the completeness of the documentation,
• the complexity of the case,
• the effectiveness of contact with the debtor.

If the matter is resolved at the amicable stage, the repayment period depends on the terms of the settlement and the repayment schedule. If it becomes necessary to take the matter to court, the entire process is prolonged. Therefore, it is best and most advantageous to settle the matter and repay the debt before the case is referred to court.

Debt collection is a process designed to help sort out your financial situation and lead to the repayment of the debt in the simplest way possible. Although it often causes concern, in practice many cases are successfully resolved at the amicable stage – thanks to dialogue and the debt collection agency’s personalised approach.

Arrears in payments can be a cause for concern, but working with a debt collection agency gives you the chance to resolve the matter amicably and avoid unnecessary stress.

• What does it mean when a debt collection agency takes a case to court?

Court proceedings are intended to formally confirm the obligation to repay the debt and enable further legal action to be taken.

• Does debt collection mean a bailiff?

No, debt collection does not automatically mean bailiff proceedings. In many cases, the process begins with amicable measures aimed at clarifying the situation and determining a possible method of repaying the debt.

• Is it possible to negotiate debt repayment?

Yes, in many cases it is possible to negotiate the terms of debt repayment. Contacting the debt collection agency promptly allows you to discuss your financial situation and jointly agree on a solution tailored to your current repayment capacity.