An invoice sat unpaid past its due date. You sent a reminder. Then another. Now the debtor's gone quiet, and you're wondering what actually happens next, how long it takes, and whether it's worth the effort.

That's the question this guide answers. Not the textbook version. The real order of events, with realistic timeframes, honest costs, and where an agency changes the outcome versus chasing it yourself.

We've been running recoveries across Australia and New Zealand for more than 20 years, with an ABN active since 2000. This is written from inside the process, not around it. If you'd rather skip the reading and have someone look at your file, our free debt appraisal tells you what the debt's worth chasing before you spend another minute on it.

Debt recovery is the process of getting paid money you're owed after the debtor has stopped paying voluntarily. It runs from a polite overdue notice all the way to court enforcement. Where you stop on that ladder depends on the debt and the debtor.

Two real options exist at the start. Chase it yourself, or hand it over.

In-house chasing works when the amount is small, the relationship's still intact, and the invoice is recent. A phone call, a friendly reminder, a repeat invoice. Most debts under a few weeks old and under $2,000 get paid this way.

An agency starts making sense when the debtor's ignoring you, the debt's aged past 60 days, it's disputed, or the amount justifies the effort. Here's the part most people miss. Debtors read your reminders as "another invoice." They read agency debt recovery services as "this is escalating." That mindset shift is why agency-handled files get paid faster, and it's also why most people wait too long to make the call.

Recovery follows a predictable sequence. Skip stages and you weaken your position. Understand the order and you'll know where your debt currently sits, and what happens next.

The moment an invoice goes past its due date, send an overdue notice. Simple, friendly, factual. Restate the invoice number, the amount, the original due date, and a clear ask for payment within seven days.

Most legitimate debts clear at this stage. Cashflow slipped, an invoice got buried, a signatory was on leave. A prompt notice within the first week usually surfaces the reason. Timeframe: 1 to 2 weeks from due date to first response.

If you hear nothing after two notices, you're no longer dealing with an oversight. You're dealing with someone who's decided not to pay you first.

A letter of demand is the formal shift from reminder to warning. It states the debt, the deadline (usually 7 to 14 days), and the consequences of non-payment. That typically means agency referral or legal action.

Here's where the leverage question matters. A letter you send on your own letterhead reads as another follow-up. A letter on agency letterhead signals escalation readiness. Debtors read it as the threshold before legal action, not a repeat reminder. That perception shift can accelerate payment by weeks, and it's the single biggest reason businesses hand the file over at this point rather than push through another cycle of in-house chasing.

Timeframe: 7 to 14 days for a response. Silence tells you the next move.

If the debtor responds and can't pay in full, negotiation opens up. Payment plans, part-payments, extended terms. Recovery isn't always all-or-nothing, and a structured plan is often better than a court judgment you can't enforce.

The trap: agreeing on a plan by email or handshake. Without a deed of settlement, if the debtor defaults you start from scratch. A properly drafted deed lets you enter judgment immediately on default. That's the difference between a theoretical arrangement and a legally enforceable path to recovery, and it's the step DIY chasers almost always skip.

This is where a debt collectors Australia team takes over the file. Skip tracing to locate the debtor if they've moved, a mix of phone, email, SMS and letter contact, and negotiation with authority behind it.

Agency contact is bound by the ACCC debt collection rules. Phone contact is capped at 3 calls per week or 10 per month, on weekdays 7:30 am to 9 pm, weekends 9 am to 9 pm, and no contact on national public holidays. Those rules exist to protect debtors from harassment, and reputable agencies follow them to the letter.

Timeframe: most recoverable debts clear within 30 to 90 days of file placement.

When contact and negotiation don't land payment, legal action is the next lever. For debts under $25,000, tribunals like NCAT (NSW), QCAT (Queensland) and VCAT (Victoria) offer a faster, cheaper path than court. QCAT's minor debt process covers agreed debts up to $25,000 excluding interest, and a debtor who doesn't respond within 28 days can face a default decision.

Above tribunal thresholds, or for complex matters, it's the Local, Magistrates or District Court depending on the state and amount. Statute of limitations matters here. In most states you have 6 years from the last payment or acknowledgment to start proceedings, and 3 years in the Northern Territory.

Here's what most people don't realise. A judgment isn't payment. It's a court order that says the debtor owes you money. Enforcement is the separate step that turns that order into actual dollars in your account.

Enforcement options include garnishee orders (against wages or bank accounts), warrants for seizure and sale of property, and for company debts, a statutory demand under the Corporations Regulations 2001. Statutory demands require a minimum debt of $4,000 and give the company 21 days to pay or dispute before you can apply to wind them up.

Timeframe: enforcement can take another 30 to 90 days on top of the judgment.

The cost question has three real answers, not one.

DIY. Not free. Staff time chasing calls and emails, opportunity cost on the work that isn't getting done, and the aging risk. The older a debt gets, the lower the recovery rate. A debt at 90 days is materially harder to collect than the same debt at 30 days.

Agency. Most reputable agencies work on a no-collection-no-fee basis with no upfront cost. You pay a commission on what's recovered. If nothing's recovered, you pay nothing. That model shifts risk from you to the agency, but it also filters your file. Agencies offering this pricing only take on cases with clear documentation and solvent debtors, because they don't get paid otherwise. If an agency accepts your file on no-collection-no-fee, that's a strong signal the debt has merit. If several decline, that's information too.

Write-off. The zero-effort option. You lose 100% of the debt, and the tax deduction is small comfort against the actual cash. Worth considering only if the debt is genuinely uncollectable or below the cost of pursuing it.

Rough comparison for a $10,000 commercial debt:

For business debts specifically, commercial debt collection typically runs on the same no-collection-no-fee structure, with commission scaled to debt size and age.

Legal action is a lever, not a first step. Used well, it forces resolution. Used badly, it burns money and delivers a judgment you can't enforce.

At eCollect, legal escalation runs through E C Legal, our in-house law firm. That's not a referral to an external solicitor with their own billing clock. It's the same operator running your file from demand through to judgment and enforcement, which keeps costs contained and timelines tight.

Tribunal vs court. For debts under $25,000, tribunals (NCAT, QCAT, VCAT and equivalents) are typically faster and cheaper. Filing fees are lower, procedures are simpler, and default judgments are quicker. QCAT's minor debt process handles agreed debts up to $25,000 excluding interest, provided the debt agreement was made within the last 6 years.

Here's the catch most businesses don't see coming. Tribunals don't have the same enforcement powers as courts. A tribunal order is only enforceable once it's registered with the appropriate court. That's a separate step, more paperwork, and more time. Businesses who think a tribunal order means the money's arriving are in for a surprise.

Statute of limitations. You've got 6 years from the last payment or written acknowledgment to start proceedings in most states, and 3 years in the Northern Territory. Miss the window and the debt becomes statute-barred, meaning it's still owed but no longer enforceable through the courts. More detail on the time limit for debt collection if you're chasing something aged.

Statutory demands. For company debts of $4,000 or more, a statutory demand under the Corporations Regulations 2001 gives the debtor 21 days to pay or apply to set the demand aside. Fail to do either and you can apply to wind the company up. Statutory demands are most effective when timed against something the debtor cares about, like a business sale or restructure, where even a disputed demand can hold up the transaction and force settlement. Left as a last resort, they lose that leverage.

Not every agency is built the same. A short checklist filters the operators from the phone farms.

• Commercial Agent licence. Debt collection is licensed at state level in most Australian jurisdictions. No licence, no engagement. Check the register.

• AFCA membership. Membership of the Australian Financial Complaints Authority means an independent complaints process exists. That's a baseline, not a bonus.

• ISO 9001 certification. Independent quality management certification. Rare in this industry, and a genuine signal of process discipline.

• Trust account for client funds. Recovered money should sit in a dedicated trust account, not the agency's operating account. Ask directly.

• Dedicated account managers, not a call centre. Complex files need continuity. A single account manager who knows your file beats a rotating queue.

• Industry-specific expertise. Trades, medical, finance, construction, freight. Different sectors, different debtor behaviour, different playbooks.

• Online client portal. Real-time visibility on file status, contact logs and recovered funds. If you're being fed monthly PDF reports, that's last decade.

• Red flags. Upfront fees, no licence displayed, no complaints process, vague on timelines, aggressive sales pitch. Walk away.

For the full regulatory picture, our legal and compliance page covers what a licensed agency looks like end to end.

Our own numbers: 20+ years operating, more than 10,000 clients served across Australia and New Zealand, and over $120M recovered on behalf of clients. Not a boast, just the operating standard the checklist above is measured against.

The rules shift depending on who owes the money.

Commercial debt (business-to-business). Faster paths, higher thresholds, and statutory demands as a genuine pressure tool. Corporate recovery uses the Corporations Act framework, and disputes tend to be about invoices, contracts and delivery, not affordability.

Consumer debt (business-to-individual). Governed by the Privacy Act 1988, the Australian Consumer Law, and the ACCC/ASIC debt collection guidelines. Credit default listings against an individual require the debt to be at least $150 and at least 60 days overdue, with proper notice given. Default information stays on the credit file for 5 years from listing. Personal debt collection runs on a different playbook because the protections are tighter and the tools are narrower.

Small business owed by consumers. The hybrid. Trades, health, and professional services chasing individual customers sit in consumer rules despite being commercial creditors. Worth knowing before you send the first letter.

• ACCC debt collection rules

• ACCC disputing a debt

• Privacy Act 1988

• Corporations Regulations 2001

• QCAT debt dispute process