Announce Punitive Measures Against a Client's Account • Letter Templates and Guides

How to write this letter:

1Inform the customer that payment is past due and state the amount of the delinquency.
2Inform the customer of the punitive action against his or her account and explain how the customer can regain full credit privileges.
3Invite the customer to tell you if there is an error in your records.


Try to maintain a courteous tone as you explain your reasons for taking this action. Keep in mind that you want to maintain this customer's business, even if you must ask for cash payments.

Example Letter #1


Your account is seriously past due. As of this date, it has been 80 days since we last received a payment. We regret that we must suspend your credit privileges and will insist on payment in cash or check for future purchases. When your account becomes current, we will reevaluate your situation to determine whether we can reinstate your credit line.

If we have made an error, or if you feel that there is a reason we should not suspend your credit, please inform us in writing as soon as possible.

Example Letter #2


During our phone conversation on June 3, you promised to make monthly payments of $300.00 to pay off your overdue balance of $2,420.00. Since then we have received no payment from you. Effective immediately, we must request that you pay cash for all orders until this balance is paid in full.

Example Letter #3


Your Doe's charge account balance is more than 10% over your credit limit and your minimum payment of $30.00 (including $10.00 late payment penalty) is 60 days past due. In light of this situation I have no choice but to suspend your credit privileges until the balance of $567.89 has been paid in full. Your credit will then be reinstated. Please let us know if there has been an error in our calculations. We appreciate your business and hope to be able to extend you credit again soon.

Example Letter #4


We understand that our credit customers are some of the busiest people in the world, and that it can be difficult to remain on top of all obligations. However, your Doe's account payment has been overdue for over 90 days, and our two previous letters have received no response from you. Under these circumstances we must ask that all further purchases be on a cash basis until such time as your balance has been brought to a manageable level and payments made on time for six consecutive months. In addition, we must warn you that if this balance remains unpaid, the matter will be turned over to a collection agency by the first of next month. If there is a discrepancy between your records and ours, we invite you to discuss the matter with John Doe, our accounts receivable officer. John may be reached at 555-5555 during business hours.

Write Your Letter Step-by-Step


Inform the customer that payment is past due and state the amount of the delinquency.

Example Sentences for Step 1

Example Phrases for Step 1


Inform the customer of the punitive action against his or her account and explain how the customer can regain full credit privileges.

Example Sentences for Step 2

We feel that we must request cash upon delivery for the next four months. At the end of that time, we will reevaluate your company's financial condition and make our decision whether to reinstate your credit account. We have made numerous attempts to contact you by phone, but have been unable to reach you. We would like the opportunity to discuss your past due account to see if we can offer some solutions to help you resolve this problem. We regret that we must lower your credit line to $5,000.00 due to your failure to make your payments on time. We will consider raising your account to its original limit when you have made prompt and full payments for six consecutive months. In order to avoid incurring additional late charges and possible litigation, please submit $1,015.00 to our corporate office immediately. Due to your failure to pay your account balance, we are forced to revoke your credit privileges until you have paid the full amount due. Effective immediately, we must ask that you pay cash for your orders until your account balance is paid in full. We hope that you will understand that we must restrict your credit line to $1000.00 because of your consistently late payments. If you make your payments on time and in full for the next six months, we will consider raising your limit to its original $5000.00. We need to make other arrangements with you to pay for our services until you overcome your financial difficulties. For these reasons we must reconsider your current payment options and lower your credit limit to $3,000.00. In six months' time we will reevaluate our decision. We must cancel your credit privileges for the next six months because you have not made your payments on time. If your payment is not received by September 19, 2019, a negative credit report will be made on your account. If this amount is not received by February 9, 2019, we will consider you in default on your contract. If I have not heard from you by September 19, 2019, I will assume that you have no intention of seeking a solution to the delinquency problem voluntarily and will, therefore, retain an attorney to pursue legal action to recover the unreturned property. If your account is not current by April 13, your credit line will be canceled.

Example Phrases for Step 2