Muller Law Firm Provides Options to Reduce Risk

BIRMINGHAM, Mich. - Michimich -- Don't want to wait and see if your customers pay their bills?

The two leading alternatives to the traditional collection of accounts receivable are:

Credit insurance: An insurance company actually insures the account receivable, typically for a fixed percentage of its value.

Factoring: You sell the account receivable at a discount to another company – usually called a factor – for cash.

Purchasing Credit Insurance

Credit insurance, also referred to as trade credit insurance, is offered by insurance companies and some government export credit agencies. This insurance usually covers a fixed percentage of the account receivable. In other words, if the customer fails to pay a bill, your insurance company reimburses you for a portion of that unpaid bill. You must absorb the cost of the insurance as a business expense, and you still take a bit of a hit in the event of a default if you insure for less than the full value of your receivables.


Instead of insuring your accounts receivable, you may decide to sell them. Your factor determines which accounts receivable it wants to purchase and at what discount. For example, if a customer owes you $10,000, your factor may offer you $9,000 for the account. You get your money when you sell the account receivable regardless of when your customer pays. You gain quick payment with no credit risk, but you lose the amount of the discount.

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After these options, do you still need help getting the money you deserve?

Since 1961, the top-rated lawyers at Muller, Muller, Richmond, & Harms, P.C. have been dedicated to debt collection services in Michigan (! Their debt collectors specialize in pre-suit collection, litigation, and judgement enforcement.

Contact Muller Law Firm today!

About Muller Firm: Located in Birmingham, Michigan, Muller Firm P.C. is a family practice handling debt collection in Michigan for in-state, out of state, and international judgments against debtors. Their debt collection experts fight for creditor's rights no matter how big or small the amount of debt. Call today for help with your collections!

Mike Muller

Source: Muller, Muller, Richmond, & Harms, P.C.
Filed Under: Legal

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