Red Flags that Your Customer May Default on Debt

Part of Credit & Collections Kit For Dummies Cheat Sheet

Certain events should trigger an immediate investigation of your customer’s account, and immediate collections action if the account isn’t paid in full.

Be on the lookout for the following red flags and follow up immediately if your customer

  • Has a disconnected phone

  • Has vacated the premises without leaving a forwarding address

  • Avoids telephone contact and fails to return messages

  • Changes ownership, address, or telephone number

  • Drops significantly below the usual volume of orders

  • Displays poor paying habits

  • Breaks promises to pay the account balance or makes excuses for not paying

  • Holds up payment over petty disputes