From NNA: Overdue Notary Invoices: Strategies For Getting Paid

You can read the original article at: Overdue Notary Invoices: Strategies For Getting Paid

Collecting on overdue invoices

Updated 10-16-17. Unpaid invoices are a source of frustration to many Notary Signing Agents. But Signing Agents are not alone. Seventy-one percent of independent contractors have had trouble getting paid by their clients, and these people on average are owed more than $6,000 (some as much as $30,000), according to the Freelancers Union.

To make matters worse, some larger corporations work on payment cycles that can exceed 120 days, while your rent and the electric bill are due every month. And collecting these debts is tricky, especially if you want to preserve your relationship with the client. So what strategies can NSAs employ to peacefully collect debts without jeopardizing their client relationships?

Everything Starts With A Notary’s Fee Agreement

Open communication is crucial. When problems do arise, each step of the collections process, from the first day a bill is late to months later, should be marked by careful, professional dialogue, and a trail of paperwork. It all starts with the contract or agreement, said Caitlin Pearce, director of member engagement for the Freelancer’s Union.

“Make sure you have a clear, written agreement, ideally a formal contact,” she said. “This protects the company as well as the freelancer.”

Most title companies and signing services have written contracts with the NSAs they use. Make sure you and your client are clear on all the requirements, large and small, as well as the due dates, payment terms and any other expectations. It’s also a good idea to have your own contract template for those clients who rely on handshake deals. Don’t forget to have a lawyer review it to ensure that you’re asking for things that are within the scope of the law, Pearce said.

Before beginning a job, Pearce also suggested that NSAs find the name and contact information of the person responsible for payments, whether it’s the company owner or an employee in accounting. You should have their phone number and email address, and establish contact. Some companies have bureaucratic red tape a mile or two long; if you’ve chatted with your contact, your invoice is less likely to get lost in the shuffle.

Your Payment’s Late — Now What?

When you send your first invoice, you should also clearly state when you’ll follow up if not paid by a certain date. On that exact date, call and email your contact. Be polite and professional, Pearce said, but let them know you’re not going to let this go. Personally chasing after people for money can be tough, so there are several brands of payment collection software that can do a lot of the work for you, such as sending reminder letters and emails. WebAR, a cloud-based platform, manages accounts receivable and will process payments. The credit bureau Experian also offers an application. Its program will validate names, addresses, and other important data against information reported to Experian, and it’ll help you get nuggets like unpublished phone numbers.

Using software may help you keep your distance, and your relationship friendly. But if they do not work, it may be time to call someone like Julie Elster. Elster is a one-woman debt collector who comes recommended by a number of freelancers, according to Pearce. Here’s how the process works: when the invoice becomes overdue, forward it along with any relevant information, and Elster will do the calling for you, and she’ll keep it polite and professional.

“I’ll be thermonuclear nice. That’s the level of nice where people feel guilty about not paying sooner because I’m so nice,” she writes on her website. Sometimes small business owners don’t want to do the pestering; in these cases, hiring a second party, like Elster, can do the trick.

Escalation Tactics If A Notary Isn’t Paid

So you sent repeated invoices, had someone like Elster make calls, and you’re still waiting to get paid. What next?

There’s also small claims court, and if you choose to go down this path, make sure you have paperwork, including emails and copies of work product, available to show a judge. But that can be time consuming and costly. Frank Metayer, who owns San Diego-based Mobile Notary Express, recalled an experience he had with one signing service. After 30 days, he sent a friendly email. His second attempt was a voicemail. By then, he went over the client’s head and alerted the escrow company that he had not been paid. The following day, he was called by the signing service and almost immediately paid.

Sometimes you have to look at relationships. Escrow companies are important to signing companies and they don’t want to lose those contacts, he said. In another case, he did a signing for a different escrow company. After three attempts to collect, he sent an email and cc’d his contact’s manager. He promptly got a check.

Writing for the U.S. Small Business Administration, Barbara Weltman, an attorney and small business expert, notes that “invoices aren’t like fine wine — they don’t get better with age.” But if nothing works, and you can’t get paid what you’re owed, you may be able to write off the bad debt on your taxes. “After all collection activities have been used and you know that the funds are uncollectible… you can deduct your loss,” said Weltman.

Collecting debts may be a hassle, and may force you to get assertive while discussing a topic that makes many people uncomfortable, but persistence often pays off. Pearce said some freelancers have doggedly pursued debts as small as $100. On principle. Because everyone deserves to get paid for the work they do.

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