How to Write the First Collection Letter

Writing Collection Letters

In our previous article in this series How to Write Reminder Emails, we talked about the importance of customer communications and providing courtesy reminders before the invoice is due. These simple reminders are enough to get most customers to pay invoices on-time. But when an invoice payment falls behind, it’s time to take a different approach. Read on to see a sample of how to write the first collection letter (also called a dunning letter).

Setting the Right Tone

If you’re following the strategy we’ve outlined so far, you’ve sent two reminders with the invoice attached before the due date (in addition to sending the original invoice). 

However, it’s important to keep in mind that at this point invoice is still barely past due. It could be that the customer simply forgot to pay or someone in their accounting department was out sick or on vacation. Whatever the case, it’s important that the tone of your letter or email matches the situation in which the invoice has gone just a little bit past due.

If the invoice remains outstanding for another 30, 60 or 90 days, the tone of subsequent collection letters will change and become more stern. But for now, keep it somewhat light and focused primarily on reminding the customer that the invoice is due.

First Collection Letter – Past Due Notification

Here’s a sample of the first collection letter (aka dunning letter) you might send to a customer as soon as the invoice has gone past-due:

Dear <Name>,

Just a reminder that invoice number <Invoice_Num>, which was issued on <Invoice_Date> for $<Invoice_Total>, is now past due. A copy of that invoice is included with this communication.

If payment has been issued, please contact <AR_Rep_Name> at <AR_Rep_Email> or <AR_Rep_Phone> to provide us with the payment information so we may properly notate your account. If payment has not yet been made, we accept check, credit card, ACH, and wire transfer, and encourage you to make a payment today using one or more of those methods.

As always, we appreciate you as a valued customer and look forward to our continued relationship.



Note the following in the letter sample:

  • Details including invoice number, date, and amount
  • Clearly state that the invoice is past due
  • Provide payment options and desired next steps

💡 TIP: all written communication (email or letters) sent throughout the accounts receivable and collections process should include copies of the invoice(s) in question.

A/R Collections Timing and Best Practices

Using letter and email templates are a vital aspect of an automated and effective collections strategy. They allow you to standardize your approach so you can test and refine different variations of emails and letters to determine which version is most effective. 

In addition, we recommend that you standardize the timing of your reminders and collection letters/calls. In fact, here’s a cheat sheet for collections timing best practices to use as an example of a typical approach a company might use:

AR collections timeline best practices

📝UP NEXT: Be sure to check out the next article in this series:

How to Write the Second Collection Letter.

Want More Tips, Templates and Guidance Like This?

Click below to download our Ultimate Guide to AR Collections where you'll find 27 pages of expert advice, best practices, industry benchmarks, and loads of letter templates and call scripts.

AR Collections eBook Graphic


    Grow Your Business!
    Get key business process improvement tips, delivered right to your inbox!


    Subscribe To The Dynavistics Blog

    New call-to-action

    You may also like

    Cavallo's Analytics Cloud Upcoming ...
    on December 6, 2022
    business software

    Cavallo - New Features Cavallo's Analytics Cloud is just getting better! Want to take Microsoft ...

    ITA Fall 2022 Applied Improv
    on December 1, 2022
    business software

    Session: Practical/Applied Improvisation For Leaders Want to do something fun and out-of-the-box at ...

    Cavallo's Analytics Cloud FAQ
    on November 17, 2022
    business software

    Cavallo - Complete Visibility and Intuitive Data FAQ Pull back the curtain on your data and get ...

    Welcome to Your Future - Cavallo ...
    on November 1, 2022
    business software

    Complete Visibility and Intuitive Data Webinar It’s 2022 — is your data working for you? Want to ...

    Microsoft Dynamics BC Myth Busters
    on October 4, 2022
    business software

    We are receiving questions from our clients and others about Dynamics 365 BC and Dynamics GP. Many ...

    5 Traits of a Great Cloud-Based ...
    on September 20, 2022
    business software

    Achieving Operational Excellence : Moving Payroll to the Cloud with a great Provider  As you begin ...