21/10/2020 by MNV Associates
How to Strengthen your Debt Recovery Strategies
There are different laws in the UAE that allow borrowers to recover debts from loan holders who do not make payments. In the case of liquidated company debts, liquidators are expected to resolve debts during the process. Read on to get advice on how to improve the practices of debt recovery in such situations.
Enhancing Debt Recovery Strategies suggestions
- Bear in mind: The business remains a corporate entity
You may be alarmed that they are liquidating the business that borrowed money from you. As the company that took out a loan is now being disbanded, it might seem that they'll get away with not paying the debt. In such case, the crucial word to take note of is that it is 'being' dissolved, which indicates that it is still going through the process.
Under the Commercial Companies Law (CCL) of the UAE, firms under liquidation can remain a corporate company till all the measures are completed. This entails participating in legal hearings, transferring its movable assets and real estate, and repaying its loans eventually. Thus, the law ensures that the debt will be retrieved because, until it pays you, the corporation will not complete the process.
- Keep in touch Your Lawyer
Once it comes to debt restructuring, you need to know what businesses under liquidation are not covered by the insolvency statute. While insolvency laws prohibit you from taking legal proceedings against a debtor who has not been able to make repayments under your arrangement, a liquidated company can be brought to court.
So, you can start discussing with your lawyer if you are dealing with a corporation that can not pay back its loans. It may be essential to follow up with the regulations regarding debt recovery, despite being in the industry. So, it will help to speak with your lawyer to give you a much clearer understanding of the best way to proceed.
According to the CCL, before they retrieve the loan, creditors may obey the rules indicated in the statute. You have the option of getting arbitration from the judge, too. Your lawyer will also assist you should you decide to pursue legal action. They will defend you in court, deal with disputes, and offer advice on the lawfulness of your proposals. Just make sure you stick with a lawyer who, particularly in debt recovery, specializes in finance.
- Discuss with the Company Liquidation Services Firms
To successfully complete its dissolution, the organization will have to conduct all functions required during the process. The debtor may decide to get a company liquidation services firm to perform as the liquidator, with liquidation being a complicated matter.
Even when you have an arrangement with the loan company, and keeping in contact with them is certainly necessary, you would also like to keep in contact with the liquidation company that works for them. This way, you understand how the program is running and when they are getting through the phase in which the debt is settled.
The bottom line
One of the most daunting procedures in the lending industry is debt recovery. You will improve the methods of debt recovery with these tactics, while guaranteeing that you get back the money with less uncertainties.