How to Ensure a Defaulting Client Pays Their Debt

Client default is a common issue for entrepreneurs and service providers. Knowing how to properly collect a debt and ensure legal protection can make a huge difference for your business.

What to Do When a Client Fails to Pay?

When a client delays or refuses to pay, the first step is to seek an amicable solution. Here are some initial actions:

• Send formal reminders: Emails and messages reinforcing the agreed commitment.

• Negotiate an alternative: Payment plans or renegotiation might be a viable solution.

• Send an extrajudicial notice: A formal warning expressing the intention to collect can be effective before legal measures.

If these attempts fail, the next step is to file a debt enforcement lawsuit.

How Does the Debt Enforcement Process Work?

If you have an enforceable title (such as a signed contract, check, promissory note, or invoice), you can file an Enforcement Action in court. This means the debtor will be notified to pay the debt within three days or have their assets seized.

If the debt remains unpaid, the judge may order:

• Blocking of funds via bank system;

• Seizure of assets such as vehicles and real estate;

• Inclusion of the debtor’s name in credit default registers.

How to Protect Yourself? Essential Documents

To avoid complications and facilitate collection, maintaining proper documentation is crucial. Key documents include:

• Signed contract with all terms detailed;

• Invoices proving the transaction;

• Emails and messages confirming the agreement;

• Partial payment receipts, if applicable.

The more documentation you have, the easier it will be to prove the debt and enforce payment.

Debt enforcement is a right for creditors and can be a swift process if documentation is well-organized. It’s always advisable to seek legal counsel to act strategically and increase the chances of recovering what is owed.