Download Demand Letter Template for free

You can use a demand letter template to prepare a letter demanding that the recipient take a certain action. Usually, a demand letter is used to initiate legal negotiations between opposing parties. If used effectively, the demand letter template can result in dispute resolution instead of litigation. A demand letter will seek to influence the recipient’s understanding of the risks associated with the dispute.

A demand letter template gives the sender a chance to state the harm that they have suffered and the relief they request. It can also be used to indicate the sender’s intent to take legal action should the dispute not be resolved. In some instances, you might even be required to send a demand letter before you can file a lawsuit. That way, the demand letter also creates a paper trail which can then be used as evidence if the sender’s conduct is later called into question.

What is a formal demand letter template used for?

The main purpose of the demand letter template is to resolve disputes. It is crucial to understand how this letter works and why you might need to send one. In general, a demand letter shows the other party that you are serious. Before you take legal action, you must consider using this demand letter template.

A demand letter shows the other party that you are serious

If you are handling a dispute with another company, usually the communication will be via phone calls and emails. However, with this kind of communication, the other party might not think that you are serious about escalating the issue and pursuing it legally. Instead, they might be tempted to think that you are just blowing off steam. However, when you send a demand letter, the company will start considering the possibility that you are serious, and you may file a lawsuit. As such, they will start taking your claims seriously.

Courts usually view a demand letter as a sign of good faith

From a judicial perspective, having sent a letter of demand indicates that you would have wanted to resolve the issue without escalating things. Therefore, sending a demand letter shows that you made an effort to try to deal with the issue internally before you pursued litigation. Apart from that, in some states, you are required to send a demand letter before taking legal action.

Using a demand letter template can save time and money

Usually, if you try to have an attorney draft a demand letter for you, it will cost a considerable amount of money compared to the original payment. On the other hand, writing a letter on your own without any experience might not be such a good idea.

However, with a demand letter template, you can get a good idea of how to structure the letter and what to include in it so you can collect outstanding payments more efficiently.

Also, if this template helps you to deal with the dispute before going to court, you will save thousands of dollars. Even if you end up winning the case, you would have spent a lot of money and time on court proceedings and lawyers.

Collection agencies cost a lot of money and dealing with them can cause emotional distress to everyone involved. Many clients simply prefer settling the debt or agreeing on installment payments rather than involving a third party. This is where sample letters help.

How to write a letter of demand template effectively

To use this letter of demand template effectively, you have to ensure that it convinces the recipient that the chance of winning in court is low. Apart from that, it also has to indicate that the expenses, time spent, and inconvenience of dealing with legal action are too high and that the most reasonable price is simply paying the original debt.

Therefore, when you use a template, you must ensure that it has legal, practical, and emotional arguments.

Before you use the template, you must also be familiar with the recipient’s interests and goals - no one wants a public record of being in debt. That way, you can adapt the tone and the contents of the settlement demand letter with the recipient’s perception in mind.

Preparing a strong demand letter

The first step when preparing your demand letter is to download and save the demand letter template. Once you have the template, you can then start writing the letter. It is important when writing the letter to keep your goal in mind.

The purpose of the letter is to encourage the recipient to analyze the situation in a business-like way. Ideally, you would want the letter to inspire the reader to think about the following:

• How much time will be spent dealing with the case if it goes to court?
• Do they want the matter to be resolved in public?
• What are their chances of losing the case?
• How much will the case cost if they lose?
• Would settling the issue now cost less money?

Please keep in mind that you won’t write in that specific manner. Instead, you will write the letter in a way that makes your recipient think about these issues.

Tips for writing an effective demand letter using the template

Include the facts

Explaining the facts will give the reader more clarity. You need to make sure that both of you are on the same page. Also, if the case ends up in court, the judge should see that everyone understood what was happening.

You must also mention phone conversations, unanswered calls, and any inappropriate conduct by the recipient.

The more proof you have in your demand for payment letter, the higher the chances of getting the money back.

Be polite

You must not attack the recipient verbally. The more you are hostile, the more you encourage them to respond similarly. Instead, you should write it in a polite way to indicate that you are confident in your position.

After all, it's a formal letter and in case there are some legal remedies, remember that it will be ready by a law firm, a personal injury attorney or someone in court. Do your best to show that the letter is about a business relationship and a legal matter, rather than being a personal attack.

Set a deadline

When using the demand letter template, you must ensure that you set a deadline to settle the outstanding balance before a legal claim happens. Usually, a single week or two is best. This will motivate your recipient to treat the demand for payment with urgency.

Also, make sure to include the actual date to remove any doubt. After the cut off date, they'll be scared off by attorney fees and other costs associated with civil lawsuits.

Make and keep copies

Before you send the letter, make copies of it. You must also keep copies of post office receipts and correspondence from the recipient, such as the return receipt, which serves as a proof of delivery later on. If you send the demand letter electronically, make sure you don’t delete it from your email.

Benefits of using a demand letter for payment template

There are several benefits to using a demand letter template free. It provides the recipient with clear demands of what you want, and it gives them a chance before you take legal action. Apart from that, it also saves you  as the service provider a lot of time and money.