Chapter 6
Stayin’ on the Right Side of the Law: Knowing Your Rights and Duties
In This Chapter
Dealing with issues in bankruptcy
Complying with consumer credit laws
Avoiding debtor escape clauses in agreements
Drafting agreements to meet your needs
My dad used to say that a little bluff and bluster can win an argument — that it isn’t what you know so much as what the other side thinks you know. A little legal knowledge can give you the leverage (and sometimes the bluff) you’re looking for when dealing with customers who owe you money. (You’ll have to muster your own bluster.)
This chapter provides that bit of legal knowledge, covering federal law in some detail, and state laws in general terms. Use it to familiarize yourself with key legal issues and concepts and then refer to it as needed in the future. Indeed, you may even use this chapter to train your credit and collection staff on the basics of collection law.
As you delve into this chapter, you may think to yourself, “This book would make an awesome paperweight.” Collection and contract laws may seem boring, but . . . Okay, they’re pretty boring and technical. But your understanding of these laws is often front and center to your ability to collect a bad debt. And take heart: You don’t have to memorize everything in this chapter. You just need basic familiarity with legal concepts.
Basics of Bankruptcy and Receivership
The word “bankruptcy” conjures up all sorts of images that have one common thread: You, as the creditor, ...
