How to Collect a Debt | Debt Collection 101 | Get What You’re Owed

Minnesota collection attorney Aaron Hall describes the debt collection process and explains how you can collect debts owed to you.


We frequently receive calls from people who are owed money. They want to know what are their rights, what are their legal options, how do they get the money that is owed to them.

Well, first off, prevention is worth a pound of cure. In other words, after the money is out the door it is much more difficult to get back. The best way to avoid a loss is to minimize your risk at the onset. That’s how we as attorneys help our clients minimize their risk in any sort of business deal.

Or let’s assume we’ve already lost some money — then the question is: How do you get it back?

If it’s under the amount permitted in conciliation court, you can bring a claim in conciliation court without an attorney. Once you win, assuming you do, you then have a piece of paper called a judgment.

That judgment permits you certain collection efforts against the debtor, somebody who owes you money. Those include wage garnishment, typically up to 25% of the debtor’s wages; garnishing and levying a bank account as long as the money in the account is not owned by another person or otherwise exempt under Minnesota statute such as welfare or social security payments; you can also request disclosures from the debtor regarding their assets that you may be able to go after.

A lot of times the debtor does not respond to those, which means you need to do a motion to the court and the court will require that person to show up and explain why they not fill out the legally required disclosures. If they don’t show up, a bench warrant is issued for their arrest and if they are pulled over by law enforcement they will be arrested in accordance with the judge’s bench warrant.

As you can see though, you can’t get blood out of a turnip. In other words, if somebody doesn’t have money, you are not going to be able to get it from them. So it can be very difficult to get your money back later.

Also, if you are hiring an attorneys to do all this, you’ve got to keep in mind is it really worth spending that sort of money on legal fees.

You can use these efforts against individuals and businesses. But again, if a business has no assets just like a bankrupt individual, you are not going to get anything.

A good collections attorney will help you assess the ROI (return on investment) of any collection effort.

I had somebody contact me yesterday seeking to collect $250. I explained to him he should go to conciliation court. He shouldn’t hire an attorney; he should do it entirely on his own because he will spend a lot more than $250 in legal fees. And generally, you are not going to be able to recover that unless a contract that you have with the person who owes you money permits you to recover attorney’s fees.

If you are owed a significant amount of money, typically it’s going to be over $10,000; generally over $100,000; maybe even $30,000 but a significant amount where it’s worth spending hundreds, if not thousands of dollars to get the rest. Then it makes sense to contact an attorney, figure out what the legal strategy would be in order to go after the assets of the debtor. Your attorney can explain to you your legal rights and options and implement a collection strategy.

You are welcome to call our office if you have questions about this and are facing a similar circumstance.

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