Collection letters are letters intended to obtain payment from a client, a customer, or other sources of income. For example, you might use a collection letter to obtain a judgment you won in a lawsuit. You might also use a collection letter to notify a company you are waiting on your refund for an unacceptable product.
Your organization might use the basic format of a collection letter to request donations. The company you work for uses collection letters to request payment of overdue accounts. All collection letters are intended to accomplish one goal: to collect funds from debtors.
What to Include in a Collection Letter
Depending on the situation, a collection letter can take a friendly or aggressive tone. In all cases, it should state the amount of the requested payment and the date the payment is expected. Here are three main points to include in your letter:
- The amount due
- How the debt was incurred
- The time frame for payment
Collection Letter for Overdue Payment (Format)
{Your Name}
{Company Name}
{Company Address}
Leave this line blank.
{Recipient Name}
{Company Name}
{Company Address}
{Date}
RE: Payment Request, Invoice No. {Invoice Number.}
Dear {Name}:
Our records indicate your account balance of {Amount} became overdue on {Date}. I have enclosed a copy of the invoice for your reference.
Please pay the overdue balance today. If you have any questions, please contact me immediately at {phone number} or {e-mail address}.
Thank you for your prompt payment. We look forward to your continued business.
Sincerely,
{Your Signature}
{Your Name}
Attached: Invoice {Invoice Number}
Donation Collection Letter (Format)
{Your Organization’s Name and Logo}
Leave this line blank.
{Date}
Dear {Recipient Name}:
Thank you for your generous donation to our organization. As you know, we help {organization’s focus population} every day as a result of donations like yours.
You can use the enclosed form for payment by card if desired. We have also enclosed a postage-paid envelope for your donation.
Thank you for your support.
Best Regards,
{Your Signature}
{Your Name}
Payment Collection Letter (Format)
{Your Name}
{Your Company’s Name}
{Your Address}
Leave this line blank.
{Recipient Name}
{Recipient Address}
{Date}
Re: {Case Name}, {Case Number}
Dear {Recipient Name}:
As you know, a judgment was entered against you in {court name} on {date} in the amount of {amount}. As the creditor of this judgment, I would appreciate your payment within {time frame}.
Thank you for your prompt attention to this matter.
Sincerely,
{Your Signature}
{Your Name}
Sample Collection Letter
Elias Brown
Henderson Property Management
Henderson, NJ 87658
Mr. Nathan Brookfield
1078 South 98 Street
February 24, 2032
RE: Henderson Property Management vs. Brookfield, Small Claims Case No. 876592
Dear Mr. Nathan Brookfield:
As you know, a judgment was entered against you in small claims court on February 22, 2032, in the amount of $1,200.00. As the creditor of this judgment, I would appreciate your payment within fifteen days.
Thank you for your prompt attention to this matter.
Sincerely,
Elias Brown
Elias Brown
4 Types of Collection Letter
Sample collection letters and templates are helpful to businesses and organizations that need to collect debts but wish to remain professional. They can help you craft a letter that serves its intended purpose: to collect the funds you are owed. The 4 types of collection letter samples and templates here can be adapted to suit any business or personal need you may have.
Fund Collection Letter
A fund collection letter is a letter intended to collect funds from a debtor. This type of collection letter is often used by organizations that rely on fundraising to accomplish their goals. These letters are personable and appreciative while asking for the promised donation.
Friendly Collection Letter
A friendly collection letter is an amicable letter used to collect a debt. This approach to the collection is often used in a first attempt to collect account balances or as a request for a refund.
Debt Collection Letter
A debt collection letter is any letter intended to collect a debt. As seen above, there are many types of collection letters, and the style and tone of a collection letter are primarily determined by the nature of the collecting company or organization.
Aggressive Collection Letter
An aggressive collection letter is a collection letter written in a no-nonsense tone. This type of collection letter is used when all other recourse for collection has been exhausted. Companies occasionally write an aggressive collection letter to a debtor who refuses to pay their debt.
Collection Letter Templates
Collection letter templates cover the four types of collection letters you may send to a debtor to request payment on an overdue bill. These include the first, second, third, and final collection letters. If the reader responds to the first collection letter template, you may not need to send the second one.
Collection Letter Samples
The structure and content of a collection letter will usually vary depending on the nature of the debt, the debt amount, and state laws. Collection letter samples are example documents designed to show you how to handle different debts appropriately.
Debt Collection Letters
A collection agency sends a debt collection letter on behalf of a creditor to demand that a debtor settle an outstanding bill. The message includes information about the debt amount and a deadline. If it is a court action letter, it could also threaten legal action against the debtor.
Collection Letter Examples
Conclusion
The point of a collection letter is to firmly urge your debtor to pay you immediately. They should be written in a formal and professional style while still fulfilling their purpose. If your debt collection letters are not getting the results you need, try using one of the above templates to tone up your letter.
