Letter of demand dos and don’ts

A letter of demand can come in many forms, via email or as a registered letter to your home or place of business. But what happens if you decide to ignore an official letter of demand?

When you receive a letter of demand, the best course of action is to contact a lawyer or the creditor directly and tackle the debt outside of court. But if you ignore the letter and hope that the problem will go away on its own, you could find yourself in even more trouble.

By ignoring a letter of demand, a legal course of action could trigger in the following way:

1. Ignoring a letter of demand could result in a summons

Once you have a letter of demand in your hands, the ball is in your court about how to proceed. You can choose to ignore this letter, but your creditor’s next course of action is to take you to court. A summons will inform you that legal action has been taken, which is never the outcome you want when you’re over-indebted.

Creditors have the right to start legal proceedings if you refuse to acknowledge the letter of demand you receive.

2. When legal proceedings begin, you’ll be liable for extra fees

Legal proceedings start when a creditor has a summons issued against you. You will only have ten days to defend a summons and take action. If you fail to do so, or you miss the summons due to incorrect address or information, you will be liable for all of the legal fees that pile up.

Depending on what your creditor claims and which court the matter goes to, the legal fees alone could be a substantial extra expense on top of your current debt.

3. If the case goes to court, a judge will be in control

The final step in this process is when the case against you goes to court. It’s here that you may find yourself needing help. If you ignore both the letter of demand and the summons, the court proceedings can go ahead without you. This could result in a judge ruling how much you should pay, what a creditor can do to get you to pay (including a Garnishee order), and much more.

While unpleasant and anxiety-inducing, it’s best never to ignore a letter of demand or any letter from your creditor when you are over-indebted.

What should you do instead with a letter of demand

If you receive a letter of demand, you can contact your creditors directly or reach out to Debtline. By receiving debt counselling, we can assist you in managing your debts and dealing with any letters you’ve received.

While under debt review, you are safe from creditors, and you can work at paying off your debt as quickly as possible. This is the best course of action and a much better idea than ignoring a letter of demand when it arrives on your doorstep.