You've sent the polite reminders. You've called the office. You've been ignored for 60 days. At this point, the client isn't "busy"—they are stealing your labor.
Here is how to escalate to a collections agency.
1. The 90-Day Rule
Most professional freelancers wait until an invoice is 90 days past due before involving a third party. At this stage, the probability of the client paying voluntarily drops significantly.
2. How Collections Work
You don't "pay" a collections agency upfront. They usually work on a Contingency Basis. They will take a percentage (usually 25% to 50%) of whatever they successfully recover.
- Example: They recover a $1,000 debt; you get $700, they keep $300.
3. The "Notice of Intent"
Before you actually hand the debt over, you must send a Final Demand Letter. State clearly: "If payment is not received by Friday at 5:00 PM, this account will be transferred to [Agency Name] for collection, which may impact your corporate credit score."
4. Legal Protection
Always ensure your contract includes a clause stating that the "Client is responsible for all costs of collection, including legal fees." This allows you to potentially recover the agency's 30% cut from the client.
Frequently Asked Questions (FAQ)
Will sending a client to collections ruin the relationship?
Yes. You should only do this if you never intend to work with that client again. It is a "bridge-burning" move reserved for ghosting clients.
Does a collections agency guarantee I get paid?
No. If the company has gone bankrupt or has no assets, even an agency cannot get water from a stone. This is why upfront deposits are your only true protection.
Can I report a client to a credit bureau myself?
Unless you are a registered reporting entity, no. This is why you hire a collections agency—they have the power to put a negative mark on the client's commercial credit report.