FAQs

What are your overall collection success rates?

There are several variables that will influence recovery rates: the age of the debt is arguably the most important factor. The older the debt is, the lower the chance of recovery. Other important variables include: industry, balance, documentation, demographics and type of debt (commercial/consumer/medical, etc.).

We will usually ensure you will be paid, normally within a few days unless:

• The debt is disputed
• The debtor absconds or goes into Receivership/Liquidation/Administration
• The debtor actually has no money.
• The correct identity cannot be established
• The debt is very old

Does Geslegal provide debt collection services for foreign companies?

We have extensive experience provided commercial collection services for foreign companies that are owed money by a Spanish company. We generally are able to get excellent results when Spanish debtors understand that a professional firm such as Geslegal is now insisting on payment and will not accept the excuses and delay tactics that have been used on their foreign vendors.

What is the process you employ?

For operational and security reasons we do not detail the exact process on our website, however the basic procedure is as follows: The first approach is made by letter, telephone and email informing your debtor that we are Debt Collectors and have been instructed to recover the debt. We run certain checks and searches on the debtor to get a fully detailed background. We aim to have the debt paid in full there and then, if this appears unlikely we will discuss the various options open to you and enforce collection via one of these recovery options.

How do I become a client of Geslegal?

We have a standard commercial collections services agreement in Word format for your perusal and authorization. This agreement does not mean that you are obligated to make all of your placements with Geslegal. Rather, it exists in order to explain what we intend to do for you, our client, and what we expect you to do for Geslegal. It's basically a mini rulebook governing our relationship.

What information would you need from me in order to get started?

After obtaining your company's name, address, fax, phone and E-mail address, we would require the debtor's contact information; name, address, phone numbers, total amount owing and its due date. This information is sufficient for us to commence collection activity against your debtor. However, relative to collections, knowledge is power. The more information we possess concerning the obligation, the easier it is to dissolve objections and effect payment.

The debtor seems to have disappeared can you trace him and how much does this cost?

Tracing debtors is all part of our service and there is no additional cost for this. While we cannot guarantee we will be successful in every case we do have a very good trace rate.

Who decides if the debt is to proceed to Litigation?

We will advise you of the various litigation options, the likely costs and outcomes. The ultimate decision whether or not to proceed with litigation is yours, based on our advice and experience.

The debtor company is in Receivership/Liquidation or Bankrupt, can you help?

Yes. We investigate all our debtors to ascertain that they were trading within Insolvency legislation. If they have been trading while insolvent we will instruct the Insolvency service to prosecute the Directors. This will then open the way to pursue them personally.

When do I have to pay you?

Only if we collect all or a proportion of the debt. Our fee is levied on what we actually collect less VAT and court costs. Please ask for our terms and conditions for full information.

If there is a trial or hearing will I need to attend Court?

If the case is defended you will have to attend or send somebody that dealt with the case to explain the nature of the debt to the court.

Can I recover the court fee from the debtor?

Yes if you are awarded judgement.

Must I sign a contract to use your service?

Yes. We work with written contracts.

What happens if the debtor I placed for collection contacts me and wants to work out a settlement arrangement?

Debtors sometimes do this to delay payment or to avoid contact by the agency. Once the account is placed for collection it is best to distance yourself. Please refer them immediately to our office.

Is there a collection fee if the debtor sends me their payment after I've placed them for collection?

Debtors placed for collection are immediately contacted by us. Sometimes they resent having been placed for collection and send their payment to the creditor, hoping the agency will not be compensated.

In such cases, please let us know if payment was received so that collection activity will cease. An invoice will be sent to you to cover the contingent collection fee.

If you are unable to collect the account I placed, then what?

Once all in-house collection measures have been exhausted, and if the debtor continues to conduct business, not having filed bankruptcy, a lawsuit may be prudent. Such activity involves the services of an outside collection attorney and additional contingent costs will apply.

No action is pursued without your authorization. If you choose not to move ahead, the file is closed and confirmation is sent to you.

What happens if the debtor placed for collection wants to return the product I shipped, rather than remit payment?

We are mindful that you are in business to sell product, not to re-purchase it from your customer. Every attempt will be made to recover the amount owed to you. If the debtor is having severe financial problems and wishes to return merchandise, we let you make the decision and convey it to the debtor.

How soon can I expect my money once the debtor remits payment to you?

Remittance or holdover periods, the time between collection of the debt and submission of the payment to the creditor, widely vary. Although the standard period in the industry is 30 days, Geslegal’s weekly remittance period is 10 days.

What if my debtor disputes the debt or simply refuses to pay?

If the debtor disputes the debt, Geslegal will provide them with verification of the debt, which typically consists of the documentation initially provided by the client. On occasion and depending on the dispute, Geslegal may have to request additional documentation from you, the client, in order to properly verify the debt. If the debtor simply refuses to pay, we will review the file to determine if litigation is advisable and upon client approval, we will forward the file to collection counsel. Relevant factors to consider prior to commencing litigation include: good documentation, balance, cost of litigation and a good address to serve the debtor with the lawsuit. If a file is not considered “suit worthy”, you may still request that we report the debt to the credit bureaus. We receive many payments each week from debtors trying to clean up their credit rating by paying off old debts.

How important is the age of a debt?

The age of a delinquent account is one of the biggest factors in determining whether or not a debt gets paid. The older the debt, the harder it is to collect. Research on the collectability of delinquent accounts clearly shows that the most advantageous time to enlist the services of a collection agency is within 60-90 days of the invoice due date. Incorporating this strategy will help ensure maximum recoveries with the least cost to your company.

My Company is very customer oriented. Can you collect without damaging goodwill or jeopardizing future relationships with our clients?

Yes, we can. At Geslegal, we don't adopt a “cookie cutter” approach to collections. Many of our clients give us specific instructions as to how to proceed against their customers. We realize that today's slow-paying customer can often be converted into tomorrow's good-paying customer with the right amount of collection follow-up, which is why Geslegal endeavours to collect while attempting to salvage the business relationship between our client and their customer.

What is the smallest size debt Geslegal will help collect?

For our regular clients we will provide debt collection services on amounts as small as €200. For new clients we prefer that the first claim be at least €750.

Is a local or national collection agency right for you?

When it comes to debt collection, being local is not critical. The effectiveness of a commercial collection agency is determined far more by the background and training of the collectors, the collection approach, persistence, timely follow-up, and ferreting out myth from reality. Most work is done over the phone or by fax; most research is done via Internet and phone — so location is not a factor. Geslegal provides commercial collection services to clients from all over the Spain and the world on debtors located throughout Spain.