7 Ways to Get Delinquent Borrowers to Pay

Ashley Jensen | February 6, 2020

I think we can all agree, not getting paid is the worst. And when you have borrowers who are delinquent on their payments, that's what's happening; you're not getting paid. So, what can you do about it?

How to Get Delinquent Borrowers to Pay:

  1. Remind them
  2. Attack from all angles
  3. Be precise and be polite
  4. Make it automatic
  5. Charge late fees
  6. Make it easy to pay
  7. Offer help

Before implementing any of these steps, you need to know which borrowers are delinquent. It’s essential to have a report that can show you who is behind on their payments, what branches have the most delinquencies, and how many total payments are delinquent at your institution. As we all know, knowledge is power.

Now that you’ve armed yourself with a list of all your delinquent borrowers, it’s time to get to work.


1. Remind Them

You’d like to think that paying you is at the forefront of your borrower’s minds, but it probably isn’t. These accounts are delinquent for a reason. And it would be fantastic if all your borrowers always remembered when they have a payment due, but we don’t live in fairyland. The second best thing, remind them. If your borrower did forget, you remind them and, poof, problem solved.

However, maybe your borrower has overextended themselves and are short on money, which means it’s a fight between you, the furniture loan, the car payment, and a couple of credit cards. Reminding your borrower frequently helps you move up in the line. It lets your borrower know that you’re serious about their payment. So, remind them. Remind them again and again until you reach the front of the line.

2. Attack from all Angles

Remember that when you’re reminding your borrowers of their payment to attack from all angles. If they throw that reminder letter in the trash, send them an email. If they ignore the emails, send them texts. Text messages not getting any response, try a phone call. Plain old letters can be easy to ignore, but it’s a lot harder to block out reminders when they’re hitting you from all sides. Eventually, your borrower will surrender and make their payments.

3. Be Precise and Be Polite

When you are reminding borrowers about their overdue payment, don’t be vague. You need to communicate exactly what you want them to do in the simplest language possible.

“Please send payment within 21 days.”

It’s as simple as that, and did you notice that I used the word, “please?” According to a study by Freshbooks, you increase your chances of getting paid by more than 5% just by being polite (and for some reason, “within 21 days” is a magic formula). Who said nice guys finish last?

4. Make it Automatic

You can’t spend all day reminding delinquent borrowers to make their payments, you’ve got a business to run. Welcome to the wonderful world of automation. Set up a system to automatically notify borrowers when they are delinquent. If you can get a computer to automatically send reminder emails, letters, and text messages, in addition to making phone calls, you’ve freed up time and energy, and you’ve made it so that the reminders are more likely to go out. Your computer won’t have to put those reminders on the backburner while they attend to other work. So, make it easy on yourself and make it automatic.

5. Charge Late Fees

Still not getting paid? It’s time to bring in the big guns. Okay, I’m not sure late fees would be considered the big guns, but at least they’re an incentive. The faster your borrower makes their payment, the fewer fees they are charged. Nobody likes to see their payment continue to get larger and larger, so hopefully, this will provide your borrowers with enough motivation to send in that payment.

6. Make it Easy to Pay

Speaking of payments, you need to make it as easy as possible for your borrowers to make a payment. The easier you make it for borrowers to pay, the more likely it is to happen (and faster too). Give options. Allow them to pay by check by merely mailing it in with the already addressed envelope included in their bill. Let them pay by a phone call with an easily visible phone number. Make online payments available. Provide a quick link to pay in all reminder emails and texts. Accept both credit and debit cards. Do whatever you can to make paying convenient for your borrowers, and it might happen.

7. Offer Help

If your borrowers aren’t paying because they know they can’t make the entire payment, offering help might be a solution to both of your problems. It could provide them with a way to make smaller payments, while still bringing in money. Plus, if your borrowers see that you’re genuinely trying to help them out, it builds trust and a stronger relationship. It’s a win-win for everyone.



I hope you’ve found these tips helpful!


Tags: payment options, payment reminders

Ashley Jensen | February 3, 2020

Subscribe to Our Blog