==What is a debt?==A debt is something that someone owes someone else. For example, if someone owes you No one enjoys it when they’re owed money, that is a debtand don’t get paid. You are Learn the creditor. The person who owes options available to you the money is the debtor. A when collecting on a debt is an obligation that a debtor owes to a creditor. It may be for an agreement to repay a fixed amount of money (for example, a loan) or an agreement and the steps to pay for goods or services. This script deals with these kinds of debts. It doesn’t deal with other types of debts, for example, relating to landlord and tenant obligations, family law situations, and mortgagesthe situation. ==Understand your legal options==

==Is it worth trying to collect your =What is a debt?===No one enjoys collecting debtsA '''debt''' is something, but sometimes you must act quickly to recover typically money , that is owed or due. It may arise from a promise to you. Firstrepay an amount of money (for example, you should decide whether to proceed at all. If the debt is smalla loan), or if the debtor is bankrupt an agreement to pay for goods or unlikely services. This information deals with these kinds of debts. It doesn’t deal with debts relating to repay anythingrent, mortgages, it may cost you more time and money to collect than the debt is worthor family law situations.

==If someone owes you want to collectmoney, what that person is called a '''debtor'''. You are your called the '''creditor'''.  ===You have options?to collect on a debt===You To collect on a debt, you can:*try to collect yourself,*hire a collection agency.*try to collect yourself., or

Collection agencies typically charge between 25% and 50% of the amount of the debt they recover.  Lawyers typically charge between $200 and $400 an hour, plus expenses. Some lawyers will work for a '''contingency fee''' — a percentage of what they recover. So if they don’t recover anything, you don’t have to pay for their services, but you may still have to pay expenses. If you hire a lawyer on a contingency fee, you should get a written contract outlining what you will have to pay, and when. Neither collection agencies nor lawyers can guarantee they will recover anything from the debtor. ===You cannot harass can’t take the debtordebtor’s property===Whatever approach you decideon, you can’t take the debtor’s property (— except through proper taking legal proceedingsaction (this is explained below), and . Nor can you can’t harass the debtor. Check script ; see our information on [[Harassment by Debt Collectors (Script 252)|harassment by debt collectors (no. 252)]] on “Harassment by Debt Collectors” for more on thistopic.

==How much will =There is a collection agency or lawyer cost?time limit to sue to collect a debt===Collection agencies often charge between 25% and 50% The [http://canlii.ca/t/8qx3 law in BC] creates a basic '''limitation period''' of two years for starting a legal action. A lawsuit cannot be brought more than two years after the amount they recover“claim is discovered”. Lawyers often charge between $200 and $500 an hourIn the case of a debt, plus expenses. Some lawyers will work for if a debtor hasn’t made a contingency fee—a percentage of what payment — or acknowledged they recover. So if they don’t recover anythingowe a debt — in more than two years, you don’t have to pay for their services, but you the creditor may still have be barred from bringing legal action to pay expenses. If you hire a lawyer for a contingency fee, you should get a written contract outlining what you will have to pay, and whencollect.

Neither collection agencies nor lawyers can guarantee that they will recover anythingIf the time limit is coming up soon for a debt owed to you, and you want to keep your right to collect, you should start legal action as soon as possible. If you are not sure about the time limit, [[Low Cost and Free Legal Services (Script 430)|get legal advice]] before you sue. If you start a lawsuit after the deadline, you may have to pay the debtor’s legal costs.

You can consult a lawyer through ==Deal with the Canadian Bar Association’s [http://www.cbabc.org/For-the-Public/Lawyer-Referral-Service Lawyer Referral Service]. A consultation for up to 30 minutes is $25 plus tax. That can help you decide what to do.problem==

==Two-year time limit to sue==A two-year limit applies to most debts that become due after June Step 1, 2013. If you don’t sue within 2 years, you’ll likely lose your right to collect the debt. There may be Decide on a longer time limit for some course of action===No one enjoys collecting debts that became due before June 1, 2013. If the time limit is coming up soon for a debt owed to you, and you want to keep your right to collectFirst, you should start decide whether to sue as soon as possibleproceed at all. If you are not sure about the time limitdebt is small, get legal advice before you sue. Because or if you start a lawsuit after the deadlinedebtor is bankrupt or unlikely to repay anything, it may cost you may have more time and money to pay collect than the debtor’s legal costsdebt is worth.

==Gather =Step 2. Collect information on the facts and the evidencedebt===

*the name and contact information of the debtor and any other person or company responsible for paying the debt.*how and when the debt arose.*the ability of the debtor to pay.*the reason why the debt hasn’t been paid, if you know.

==Start by contacting =Step 3. Contact the debtor yourself===A phone call, an emailReach out to the debtor by phoning, emailing or a text is often the best first steptexting them. Remind the debtor of the debt and ask what they can do to pay the debt and avoid a lawsuit. If the debtor agrees to pay based on a payment schedule, get put the agreement in writing. Get them to date and sign it.  ===Step 4. Send a demand letter===A '''demand letter''' is a written agreement letter demanding payment of the debt. You may want to offer practical payment options that are acceptable to you, including payment by credit card or post-dated cheques.  The letter confirming thiscan’t threaten to take improper action to collect the debt. But any discussions with It is perfectly appropriate to say you are considering legal action. You might end your letter saying something like: :“I intend to take legal action to collect the debt, plus interest and costs of the legal proceedings, if you don’t make satisfactory payment arrangements within [a certain window of time].”  A common window of time to give the debtor don’t usually extend to make payment arrangements is seven to 30 days. ===Step 5. Consider legal action=== If the 2-year time limit debtor does not pay, you may want to start bring a lawsuit. It still applieslegal action.

==Sending a demand letter may help==A demand letter is a letter demanding payment of You can sue in British Columbia if the debt. You may want to offer practical payment options that you will acceptarose in BC, including payment by credit card or post-dated cheques. The letter can’t threaten to take improper action to collect the debt. But you should end your letter by saying that you “reserve the right to take legal proceedings” or “intend to take legal proceedings” to collect the debt, plus interest and costs of the legal proceedings, if the debtor doesn’t make satisfactory payment arrangements within a certain time (typically 7 to 30 days)lives or carries on business in BC.

==What if you want to sue?==If Just starting a lawsuit will sometimes make the debtor does not pay. As well, after starting the action, you may want be able to sue. You can do that if collect money from the debt arose in BC, or if debtor’s employer and others who owe money to the debtor lives, or carries on business, in BC. Depending See our information on the amount you are seeking [[Garnishment (explained belowScript 251) you sue in '''small claims court''' or '''BC supreme court'''|garnishment (no. Courthouses for small claims court and supreme court are located throughout BC. If you are seeking up to $5,000, you should file a claim with the [https://civilresolutionbc.ca/ Civil Resolution Tribunal251)]].

Just starting to sue will sometimes make The amount you are seeking affects the debtor pay. And once choice of court you start to would sue, you may be able to collect the debt from the debtor’s employer and others who owe money to the debtor, using garnishment proceedings. Script [[Garnishment (Script 251)|251]] has more on thisin.

==When If you are seeking '''up to use small claims court and the Civil Resolution Tribunal==For amounts between $5,001 and $35,000''', use you can file a claim with the [httphttps://www.provincialcourt.bccivilresolutionbc.ca/types-of-cases/small-claims-matters small claims courtCivil Resolution Tribunal]. You don’t have The tribunal is an online system designed for people to use a lawyer in small claims court. And it’s less expensive and less risky than going to supreme court. If the debtor owes you more than $35,000, you can sue for the maximum $35,000 and forget the restrepresent themselves.

You start a small claims court lawsuit by filing a notice of claim at the right small claims court registryFor amounts '''between $5,000 and $35,000''', often the registry closest to where the debtor lives or carries on business. The loser you would sue in small claims court must usually pay limited legal expenses to the winner. For more information on suing in small claims court, check the [http://www.cbabcprovincialcourt.orgbc.ca/Fortypes-theof-Publiccases/Dialsmall-Aclaims-Law/Scripts/matters Small Claims Court]. Many people represent themselves in this court. It’s less expensive and less risky than going to Supreme Court. If the debtor owes you more than $35,000, you can sue in Small-Claims-Court Dial-A-Law scripts for up to $35,000 and forget the rest. See our information on small claims court[[Suing Someone in Small Claims Court (Script 166)|Small Claims Court]](no. 166 to 168).

For amounts up to '''over $535,000''', use the you would sue in [https://civilresolutionbcwww.supremecourtbc.ca/ Civil Resolution TribunalBC Supreme Court]. It uses an online claim system. Its website has more information. You don’t have to use a lawyer with the tribunal.

==When to use supreme courtCommon questions==For amounts over $35,000, use [http://www.courts.gov.bc.ca/supreme_court/ BC Supreme Court]. This is more complicated and expensive than small claims court, and you should hire a lawyer, or speak to a lawyer before starting the lawsuit. For more information, check the [http://www.courts.gov.bc.ca/supreme_court/self-represented_litigants Supreme Court website for self-represented litigants].

===What happens after you if I get a court judgment?===

*You can question the debtor under oath about their income, assets and ability to pay.*You can seize or (that is, take ) the debtor’s assets by with a court order using a bailiff.*You can register the judgment against land the debtor owns.*You can garnish the debtor’s wages or other money owed to the debtor.

Script See our information on [[Getting Your Judgment Paid (Script 169)|169]] has more on getting your judgment paid(no. So does the provincial government website called ''[http://www2.gov.bc.ca/gov/content/justice/courthouse-services/small-claims/how-to-guides/getting-results Getting Results169)]]''.

'''The above was last reviewed for legal accuracy by [https://www.peopleslawschool.ca/lawyer/robert-rogers Robert Rogers ], Hamilton Duncan, and Barry Promislow[http://www.robertslaw.ca/ Adam Roberts], and edited by John BloisBarrister & Solicitor.'''