Sample Past Due Accounts Receivable Collection Letters
It is a tiresome and uncomfortable task to ask clients to pay their dues, but it is important. It keeps the cash flow steady and helps businesses operate normally. A lot of customers will inevitably miss their payment due dates. Some of them are genuinely unable to pay, while others might want to get away with it. Companies can adopt certain policies to smoothen their accounts receivable collection process. The first thing you can do is call up your clients or drop an email. Your sales personnel can talk to them personally and discuss the payment dates, but it is not always enough.
Print and mail overdue invoice collection letters as your customers tend to take such letters more seriously than a phone call or email.
Remember, you must draft professional letters that are considerate and polite. Also, at the same time, make sure that they are firm and precise to get the work done
You can use unpaid invoice letter templates to make your work faster and easier. In this blog, we have included a lot of samples that you can edit and use. We have also discussed how you can change the tone of your letter to grab the customer’s attention.
Overdue Invoice Collection Letters
Drafting personalized collection letters is a huge task. Most companies don’t have the time to make phone calls or send emails to their overdue accounts.
It also helps to send reminders and accounts receivable letters to customers. They are attention-grabbing and can motivate them to complete their due payments.
How to Write an Overdue Invoice Letter?
The timing of your overdue invoice letter sets the tone used. You cannot send the same letter to a client multiple times.
Mention the consequences of non-payment in every letter. But, these consequences should differ according to the time period. For example, you cannot threaten someone with legal action if their payment is overdue by a week. In this case, you would just mention the late payment penalties.
We have compiled some past-due accounts receivable letters for your reference. Keep reading to know more about them.
Payment Reminder For Invoices Due Next Week
If you send regular payment reminders, you might not have to draft any overdue bill letters. Reach out to clients before their invoice due date to receive payments faster.
Keep it short and sweet. You cannot insist on getting the payment completed because the due date has not arrived. Take care that you are not too pushy in this reminder. Rather, inquire about the customers’ wellbeing and remind them of the invoice. Also, don’t overwhelm them with too many details.
Find below a sample payment reminder:
NSV Global Inc.
San Jose, CA 95106
17th August 2021
Hello Ms. May,
Hope you are doing well! This is to remind you that invoice #8562 mailed to you on 15th July 2021 will be due next week.
We understand that you are occupied with a lot of work. But we’d appreciate it if you could take the time to go through the invoice.
Please let us know if you have any doubts or questions. We would be happy to assist you.
Thank you for your time!
Vice President – Operations
Payment Reminder for Invoices Due Today
This reminder is the most important one in the entire sequence. The bill isn’t overdue yet, so it is advisable to not be too aggravating. Your motive is to reach out to customers at the right time and ask them to complete the invoice payment. It is your perfect opportunity to contact them.
Again, keep it short as it is only a reminder. Talk to the point and use a humble tone. Mention your past conversations with the customer.
Find below a sample letter for accounts receivable collection:
Starfleet Group of Companies.
17th August 2021
I hope you are having a nice day. We spoke on the phone a few days ago. This is in regards to invoice number 236A dated 17th April 2021.
As discussed earlier, the payment for the said invoice is due today. Please find the payment link: www.starfleetgroup.com/payments.
You can also send us a check on the below-mentioned address:
Starfleet Group of Companies
77 Oaks Ln.
Savannah, GA 31420
Feel free to reach out in case of any questions.
Thank you for your business!
Senior Manager – Marketing.
The First Unpaid Invoice Collection Letter
Since it is the first collection letter, keep it informative and professional. Mention the following details in this accounts receivable collection letter:
- Number of days past due
- Amount due
- Transaction summary
- Previous attempts to contact customer
- CTA – What do you want the customer to do next?
- Late payment fees
- Time limit to complete the overdue payment
- Your contact details
By the time you draft this letter, you would have already sent a few reminders. You would have also already spoken to the customer personally about their dues. Thus, you must have strong follow-ups from now on.
There might be several reasons why the payment is not completed. Try finding out these reasons before you get too pushy.
Once the due date passes, you can send your first overdue invoice collection letter. Here’s a sample:
Kansas Kitchen Pvt. Ltd.
5011 NW Anderson St.
Emporia, KS 66801
17th August 2021
Hello Mr. Elijah,
We hope you are doing well. This is a reminder regarding your invoice #80356 which is now overdue by 7 days.
As per our records, the due date was 10th August 2021. The total amount due is $52,000. Please note that a late fee of 18% p.a is charged to your account.
We had mailed you the original invoice copy on 22nd June 2021. In case you haven’t received it, we have attached a copy. You can pay on our website through net banking/UPI/credit card/debit card.
Please let us know the payment status for this invoice. Feel free to contact us on +1 (816) 555-2493 if you need any clarifications.
Thank you for your cooperation!
Enclosed: Invoice #80356
The Second Unpaid Invoice Collection Letter
The second past due accounts receivable letter comes into the picture only when your first letter has been ignored. You need to be assertive this time. But, stay professional and polite.
The second letter is sent between 30-60 days past the due date. Add the late payment penalties as mentioned in the original invoice. Don’t forget to also remind customers of the payment terms discussed earlier.
Mention all the details that you mentioned in your first letter. You can also offer to draft a payment plan that is acceptable to both parties.
Find below a sample overdue bill letter for 30-60 days past due invoices:
Hightech Bolt Manufacturing Co.
29 Brighton Blvd.
Denver, CO 80110
Dear Mr. Peter,
Your invoice #0682 is now 45 days overdue. We need your urgent attention to resolve the matter.
We tried to contact you a couple of times earlier but received no response. If there are any issues, please let us know. We would also be happy to arrange a payment schedule for you.
The invoice copy was already emailed to your department. In case you didn’t receive it, please find the details below:
Invoice date: 3rd May 2021
Due date: 3rd July 2021
Amount due: $29,430
Days past due: 45 days
Late fee charged: $430 (@12% p.a)
We accept payment via credit card, debit card, and net banking. You can choose from among these options and pay on our website (www.hightechbolts.com).
Please drop me an email at email@example.com regarding the payment status.
VP – Sales and Marketing
The Third and Final Unpaid Invoice Collection Letter
Writing the third accounts receivable letter can be frustrating. All your attempts to contact the customer have failed and there is no response yet. But, you need to stay calm and keep up with your professional tone.
The likelihood of an invoice getting paid reduces with every week. So, it is important to continue sending such letters.
The third letter should inform customers about your next step. Tell your customers that you would be compelled to hand over the invoice to a collection agency. If the invoice amount is quite large, you can also mention involving a lawyer.
Here’s a sample of the final accounts receivable collection letter:
Steele Computers Inc.
9 Bradley St.
Bay City, MI 48707
17th August 2021
Dear Mr. Adam,
This is to inform you that the invoice dated 7th March 2021 is now 102 days past due. This is an urgent matter and we need your immediate attention to it.
We tried calling you several times over the last 3 months and got no response. All our previous payment reminders and letters have also received no reply. It would be appreciated if you reach out with a valid reason for the non-payment of the said invoice.
Please find the invoice details below for your reference:
Invoice date: 7th March 2021
Invoice no.: 1216
Due date: 7th May 2021
Amount due: $38,598 (inclusive of interest @8% p.a)
Days past due: 102 days
We have also attached an invoice copy. Kindly remit the payment within 2 business days. You can send a check to the address mentioned on the letterhead. Kindly refer to the details mentioned in the invoice for direct transfer to our account.
If the payment is not received within the said time frame, we would be forced to take legal action. Feel free to contact us if you have any questions.
Enclosures: 1 (Invoice #1216)
How to Avoid Late Payments?
Never wait for an invoice to become overdue to draft a payment collection plan. You need to have robust policies from the beginning. Find below some steps that you can undertake to avoid late payments:
Be Clear About Your Payment Terms
Discuss your payment terms in advance with customers, especially the new ones. Many companies write “Due upon receipt” on their invoices. Such phrases can leave room for incorrect interpretation by the customers.
Always fix a certain number of days or months and mention the specific due date on the invoice. It becomes easier for customers to check the invoice and know when it is due. Before mentioning the payment terms on the invoice, discuss them with customers. This way, you can remind them of this conversation in case the payment is overdue.
Charge Late Payment Penalties
If you start charging late payment penalties, customers are likely to pay you as soon as possible. Like the payment terms, also mention these charges to customers beforehand.
You can decide upon a certain rate of interest and include it in the original invoice.
Be Polite in Your Letters
While writing a collection letter, be gentle and polite. We have demonstrated it above in all the sample collection letters past due accounts.
Use words like “Thank you” and “We would appreciate it if..” A polite tone can help you set a good example of professionalism. It also motivates customers to complete their payments faster.
Attach the Invoice
Attach the invoice with every email and letter. This way, customers cannot make the excuse that they never received it. Also, take care that you are sending the invoice to the concerned person.
Print and Mail Overdue Invoice Collection Letters With PostGrid
Sometimes, it is very easy to get clients and increase sales. But, the difficult part is getting paid on time. Thus, companies should be proactive about their invoices. Keep in constant touch with customers.
If you don’t know how to write a letter to collect overdue invoices, you can use PostGrid’s print and mail API. PostGrid’s API can integrate with your CRM and write an effective letter in less than half the time. You can also use one of its pre-built templates.
Save a lot of time and streamline your debt collection process with PostGrid. You can print and mail accounts receivable letters with efficiency and ease.