{"id":289294,"date":"2020-04-15T11:52:16","date_gmt":"2020-04-15T10:52:16","guid":{"rendered":"https:\/\/nigerianfinder.com\/?p=289294"},"modified":"2020-07-01T19:38:46","modified_gmt":"2020-07-01T18:38:46","slug":"debt-recovery-options-in-nigeria","status":"publish","type":"post","link":"https:\/\/nigerianfinder.com\/debt-recovery-options-in-nigeria\/","title":{"rendered":"Top 5 Debt Recovery Options in Nigeria"},"content":{"rendered":"<p>Debts can occur as a result of business relations between foreign businesses and Nigerian companies. When business transactions are being carried out, there are contracts are signed and actions are expected to be executed by the various parties involved. Whenever there is a breach or failure to meet up with expectations or one of the parties refuses to fulfil his own part of the contract, the aggrieved party can take up actions for <a href=\"https:\/\/consumercreditcardrelief.com\/credit-card-debt\/\" target=\"_blank\" rel=\"noopener\">credit card debt relief<\/a>. Debts can also occur due to loan transactions where a party takes a loan and does not payback. Debt recovery is a situation in which a certain amount of money owed by a party (the debtor) to another party (the creditor) and which remains unpaid is being legally or professionally addressed by the creditor. The creditor then involves a third party in order to collect the money. Before you decide to look for debt relief options, consider learning the difference between <span data-sheets-value=\"{&quot;1&quot;:2,&quot;2&quot;:&quot;debt relief vs bankruptcy&quot;}\" data-sheets-userformat=\"{&quot;2&quot;:4227,&quot;3&quot;:{&quot;1&quot;:0},&quot;4&quot;:[null,2,16770457],&quot;10&quot;:2,&quot;15&quot;:&quot;Arial&quot;}\">debt relief vs bankruptcy. <\/span><\/p>\n<h2><strong>Top 5 Debt Recovery Options in Nigeria<\/strong><\/h2>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-289297\" src=\"https:\/\/nigerianfinder.com\/wp-content\/uploads\/2020\/04\/Debt-Recovery-Options-in-Nigeria.jpg\" alt=\"Debt Recovery Options in Nigeria\" width=\"514\" height=\"334\" \/><\/p>\n<p>It is important to state that there is a statutory time limit upon which actions or steps to recover debt can be taken in Nigeria. A simple contract or quasi-contract will no longer be heard by the court after the expiration of six years from the date the debt became due and actionable. Therefore, an action for debt recovery becomes statute-barred when the limitation period of 6 years has elapsed. There are laid down procedures set down by the Nigerian law during the process of a debt recovery in order to ensure justice is served without violating the rights of even the debtor(s).<\/p>\n<p>There are various methods of debt recovery in Nigeria. This article provides you five options to recover debts in Nigeria, it helps you learn <a href=\"https:\/\/www.gofundme.com\/c\/blog\/how-to-get-rid-of-debt\" target=\"_blank\" rel=\"noopener\">how to get out of debt<\/a>. Read on below:<\/p>\n<ul>\n<li>\n<h3><strong>Letter of Demand or Claim<\/strong><\/h3>\n<\/li>\n<\/ul>\n<p>The first step in the process of a debt recovery is to write a demand letter to the debtor. The letter is to serve as a warning about the consequences of failure to pay the debt within a set time (usually 7 days). The letter of demand must also contain steps that will be taken if the payment were not paid after the set time. It is demanded by law that the aggrieved party writes a letter of claim after which legal actions will be contemplated in court.<\/p>\n<ul>\n<li>\n<h3><strong>Arbitration<\/strong><\/h3>\n<\/li>\n<\/ul>\n<p>Arbitration is an alternative way to resolve a dispute without taking it to the courts.\u00a0Arbitration is especially appropriate when the parties in disputes are both corporate organizations. If the method of arbitration is taken, the proceedings can be taken privately without resorting to court actions. In the case of arbitration, both parties have to voluntarily submit to the procedure. Note that a party cannot be compelled to submit to the procedure of an arbitration, unless both parties have previously agreed to submit to arbitration in case of future dispute. The arbitrator can then make a decision on the debt recovery case.<\/p>\n<ul>\n<li>\n<h3><strong>Debt recovery action in Court<\/strong><\/h3>\n<\/li>\n<\/ul>\n<p>In case a party does not respond to a letter of demand after 7 days (or the number of days stipulated in the letter) by paying the debt. The claimant can take the case to court. It should be noted that the requirements of the claimant when seeking his\/her rights should already be specified under the agreement or contract earlier signed. The court has the power to hear and make decisions on a case of debt recovery. This can include enforcing payment of a debt by a stubborn debtor. In case the court process will take a long time, a claimant can apply for the preservation of properties of the debtor pending the final decision of the court. A claimant can also seek for damages for breach of contract.<\/p>\n<ul>\n<li>\n<h3><strong>Recovery of Debt from an Insolvent Company and Fraudulent Directors:<\/strong><\/h3>\n<\/li>\n<\/ul>\n<p>An insolvent company is one which\u00a0is in a state of being unable to pay the money owed, by a person or\u00a0<strong>company<\/strong>, on time. In this case, the company and its management will be served a letter of demand demanding full payment of the debt within 7 days of receipt of the letter. Failure to do this, actions will be taken against the company and its directors to recover the debt. The aggrieved party can also demand for payment for damages for breach of contract and winding up proceedings against the company for inability to pay its debts.<\/p>\n<p>After 7 days has elapsed and the company still has not paid its debts, a summary judgment proceeding is started against the company in order to recover the debt. The claimant also prepares an application for security of the properties of the company in debt pending the time the final decisions of the courts will be made.<\/p>\n<h3><strong>Winding Up Proceedings:<\/strong><\/h3>\n<p>Winding up\u00a0is the process of dissolving a\u00a0company by liquidating and selling its assets. The aggrieved party may also serve a letter of demand for winding up of the Company for its inability to pay its debts upon expiration of the statutory period of 3 weeks.<\/p>\n<h3><strong>A debt recovery company<\/strong><\/h3>\n<p>One can involve a third party in the debt recovery process. Debt recovery companies handle debt recovery cases via negotiation and persuasion.<\/p>\n<h3><strong>Criminal Complaint to Security Agencies<\/strong><\/h3>\n<p>Some debt recovery cases can be handled by security agencies such as the Nigerian police or the Economic and Financial Crime Commission (EFCC). Although these agencies are not empowered to collect debt, some crimes can be reported to security agencies when it entails the commission of an offence. For example, if a party obtained products or services with the intent of defrauding the other, the EFCC is enabled to conduct criminal investigations against such a party. The EFCC can freeze the assets until payment is paid or take up criminal prosecution.<\/p>\n<p>In conclusion, debt recovery involves making legal demand first by issuing a demand letter or Letter of Claim to the debtor in line with the provisions of the law. When the debt remains unpaid, the aggrieved party can begin exploring the option of taking legal actions via the court or arbitration. In some cases, one could report to security agencies or a debt recovery company.<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Debts can occur as a result of business relations between foreign businesses and Nigerian companies. When business transactions are being &#8230; <\/p>\n<p class=\"read-more-container\"><a title=\"Top 5 Debt Recovery Options in Nigeria\" class=\"read-more button\" href=\"https:\/\/nigerianfinder.com\/debt-recovery-options-in-nigeria\/#more-289294\" aria-label=\"More on Top 5 Debt Recovery Options in Nigeria\">Read more<\/a><\/p>\n","protected":false},"author":2534,"featured_media":289297,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3091],"tags":[],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"https:\/\/nigerianfinder.com\/wp-content\/uploads\/2020\/04\/Debt-Recovery-Options-in-Nigeria.jpg","jetpack_shortlink":"https:\/\/wp.me\/p6w1sx-1dg2","jetpack-related-posts":[],"_links":{"self":[{"href":"https:\/\/nigerianfinder.com\/wp-json\/wp\/v2\/posts\/289294"}],"collection":[{"href":"https:\/\/nigerianfinder.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/nigerianfinder.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/nigerianfinder.com\/wp-json\/wp\/v2\/users\/2534"}],"replies":[{"embeddable":true,"href":"https:\/\/nigerianfinder.com\/wp-json\/wp\/v2\/comments?post=289294"}],"version-history":[{"count":6,"href":"https:\/\/nigerianfinder.com\/wp-json\/wp\/v2\/posts\/289294\/revisions"}],"predecessor-version":[{"id":290450,"href":"https:\/\/nigerianfinder.com\/wp-json\/wp\/v2\/posts\/289294\/revisions\/290450"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/nigerianfinder.com\/wp-json\/wp\/v2\/media\/289297"}],"wp:attachment":[{"href":"https:\/\/nigerianfinder.com\/wp-json\/wp\/v2\/media?parent=289294"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/nigerianfinder.com\/wp-json\/wp\/v2\/categories?post=289294"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/nigerianfinder.com\/wp-json\/wp\/v2\/tags?post=289294"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}