Debt Collection Recovery

Debt Collection & Recovery Playbook

Generate compliant debt recovery strategies, collection letter sequences, and payment plan frameworks.

What This Does

Creates FDCPA/FCA-compliant collection letter sequences (initial notice → escalation → final demand)

Builds payment plan calculators with interest modeling

Generates aging bucket analysis with priority scoring

Produces skip tracing checklists and debtor communication scripts

Maps state-by-state statute of limitations

Creates bad debt write-off decision frameworks

How To Use

Tell the agent what you need:

"Generate a 5-letter collection sequence for B2B invoices"

"Build a payment plan for $47,000 over 12 months at 8% APR"

"Create an aging analysis for our receivables"

"What's the statute of limitations for debt in California?"

Collection Letter Sequence

Letter 1 — Friendly Reminder (Day 1-7 past due)

Subject: Invoice [#] — Payment Reminder

Quick note — invoice [#] for [amount] was due on [date]. Sometimes things slip through. If already sent, disregard.

Payment options: [link/details]

Letter 2 — Firm Follow-Up (Day 15-21)

Subject: Invoice [#] — Second Notice

Following up on invoice [#] for [amount], now [X] days past due. Please arrange payment by [date] to avoid late fees per our agreement.

Letter 3 — Escalation Notice (Day 30-45)

Subject: Invoice [#] — Action Required

Invoice [#] for [amount] is now [X] days overdue. Per our terms, a [X]% late fee of [amount] has been applied. Total now due: [amount].

If we don't receive payment by [date], we'll need to escalate this matter.

Letter 4 — Pre-Collection (Day 60)

Subject: Invoice [#] — Final Notice Before Collection Action

This is formal notice that invoice [#] totaling [amount] remains unpaid after [X] days. Without payment by [date], this account will be referred to our collection partner.

This may affect your business credit rating.

Letter 5 — Final Demand (Day 75-90)

Subject: Invoice [#] — Final Demand

Final notice. Invoice [#] for [amount] will be referred to [collection agency/legal counsel] on [date] if not resolved. Contact us immediately to discuss resolution options.

Aging Bucket Analysis

| Bucket | Days | Priority | Action | Expected Recovery | |--------|------|----------|--------|-------------------| | Current | 0-30 | Low | Auto-reminder | 95-98% | | 31-60 | 31-60 | Medium | Phone + email | 85-90% | | 61-90 | 61-90 | High | Escalation letter | 70-75% | | 91-120 | 91-120 | Critical | Collection agency | 40-50% | | 120+ | 120+ | Write-off review | Legal/write-off | 15-25% |

Priority Score Formula

Score = (Amount × 0.4) + (Days Overdue × 0.3) + (Customer Value × 0.2) + (Payment History × 0.1)

Score > 80: Immediate personal outreach

Score 50-80: Escalation sequence

Score < 50: Standard auto-sequence

Payment Plan Framework

For debts over $5,000, offer structured plans:

| Plan | Duration | Interest | Min Payment | Best For | |------|----------|----------|-------------|----------| | Quick | 3 months | 0% | 33% of balance | Good-faith debtors | | Standard | 6 months | 5% APR | ~17% + interest | Mid-range balances | | Extended | 12 months | 8% APR | ~9% + interest | Large balances | | Hardship | 18 months | 0% | Negotiated | Proven inability to pay |

FDCPA Compliance Checklist (US)

[ ] Initial validation notice sent within 5 days of first contact

[ ] Debtor's right to dispute within 30 days clearly stated

[ ] No contact before 8 AM or after 9 PM local time

[ ] No contact at workplace if debtor objects

[ ] No threats of actions you can't/won't take

[ ] No misrepresentation of amount owed

[ ] No harassment, oppression, or abuse

[ ] Cease communication upon written request (except legal notices)

[ ] Mini-Miranda warning included in all communications

Statute of Limitations by State (Top 10)

| State | Written Contract | Oral Contract | Open Account | |-------|-----------------|---------------|--------------| | California | 4 years | 2 years | 4 years | | New York | 6 years | 6 years | 6 years | | Texas | 4 years | 4 years | 4 years | | Florida | 5 years | 4 years | 4 years | | Illinois | 10 years | 5 years | 5 years | | Pennsylvania | 4 years | 4 years | 4 years | | Ohio | 8 years | 6 years | 6 years | | Georgia | 6 years | 4 years | 4 years | | Michigan | 6 years | 6 years | 6 years | | North Carolina | 3 years | 3 years | 3 years |

Bad Debt Write-Off Decision

Write off when ALL of these are true: 1. Account is 180+ days past due 2. All collection attempts exhausted (minimum 5 contacts) 3. Skip tracing returned no viable contact 4. Amount is below legal action threshold (typically < $5,000) 5. Cost of recovery exceeds expected recovery amount

ROI of Professional Collections

In-house collection cost: $15-25 per account

Agency contingency: 25-50% of recovered amount

Legal action: $500-2,000 per case + court fees

Break-even: Agency makes sense when balance > $1,000 and account is 90+ days

---

Take It Further

This skill gives you the collection framework. For full industry-specific automation — including AI-powered payment reminders, predictive churn scoring, and automated escalation workflows:

AI Context Packs — $47/pack, 10 industries covered

AI Revenue Leak Calculator — Find where you're losing money

Agent Setup Wizard — Deploy your first AI agent in 15 minutes

Bundle Deals

Pick 3 Packs — $97 (save $44)

All 10 Packs — $197 (save $273)

Everything Bundle — $247 (all packs + playbook + setup wizard)