Collections & Past Due Accounts

Purpose

Process for collecting on past-due invoices while maintaining professional customer relationships.

When to Use

When an invoice remains unpaid past its due date (payment due at time of service unless otherwise arranged).

Procedure

Aging Buckets

• Current: Not yet due or within grace period.
• 7 days past due: First reminder.
• 14 days past due: Second reminder with urgency.
• 30 days past due: Escalated outreach.
• 60+ days past due: Collections escalation.

Collection Steps

7 Days Past Due

Automated reminder email/text through ServiceTitan: "Hi [Name], we noticed your payment of $[amount] is outstanding. Please use this link to pay: [link]."

If no response after 2 days, CSR makes a courtesy phone call.

14 Days Past Due

Direct phone call from the office: "Hi [Name], I'm calling about your outstanding balance of $[amount]. Is there something we can help resolve?"

If the customer has a concern about the work, escalate to a manager.

If the customer needs a payment plan, discuss options (manager approval required).

Send a follow-up email summarizing the conversation and any agreed-upon terms.

30 Days Past Due

Formal written notice (email and/or mail) stating the balance, original service date, and request for immediate payment.

Phone call from office manager or designated collections person.

If the customer is unresponsive, document all contact attempts.

Evaluate whether a lien may be appropriate (for large unpaid jobs — Josh's decision).

60+ Days Past Due

Final demand letter: "Your account of $[amount] is significantly past due. Please contact us within 10 business days to arrange payment."

Josh decides next steps: continue internal collection, send to external collections agency, or write off.

Flag the customer account in ServiceTitan to require prepayment for future services.

Payment Plans

• Offered at manager discretion for customers experiencing genuine hardship.
• Must be documented in writing with agreed amounts and dates.
• If the customer defaults on the payment plan, revert to standard collections.

Important Notes

• Be firm but professional. The goal is to collect the money while preserving the relationship if possible.
• Never threaten or harass. Follow all applicable collection laws.
• Invoices in "Collections" status are excluded from standard AR reminders to avoid duplicate outreach.
• Write-offs require Josh's approval and are documented for accounting.

Related SOPs

• Payment Collection Methods — accepted payment types
• End-of-Day Financial Reconciliation — daily reconciliation
• Refund & Credit Procedures — handling disputed amounts