How to write a dunning letter that gets results

When an account becomes overdue, one of the most effective tools for following up is a dunning letter. A dunning letter is a formal written reminder sent to a customer requesting payment on an invoice that has gone past due. Unlike the original invoice or payment notice, a dunning letter emphasizes the urgency of resolving the outstanding balance.

Even when customers are late, your tone matters. A professional, courteous message is more likely to get a response than one that sounds aggressive or overly stern. Below, we explain how to structure dunning letters by aging category—and provide sample templates to get you started.

Writing a dunning letter by days past due

Dunning letters are typically sent at regular intervals: 30, 60, 90, and 120 days past due. The tone and content of each letter should reflect how far past due the invoice is, while still remaining respectful and focused on resolution.

With accounts receivable automation tools like Sage AR Automation, these letters can be generated and sent automatically—freeing up your team to focus on high-priority follow-ups.

Net 30 days past due

At this stage, assume the delay may be accidental—perhaps the invoice was missed or misrouted. Keep the tone polite and assume goodwill.

Sample Letter:

Dear [Customer Name],

This is a friendly reminder that invoice [Invoice Number], sent on [Invoice Date], is now 30 days past due. Please contact us at your earliest convenience to arrange payment or discuss the status of this balance.

Thank you,

[Your Company Name]

Tip: Follow up with a quick phone call after sending this letter. It’s often the fastest way to resolve minor issues like missing documents or email delivery problems.

Net 60 days past due

After 60 days, the tone should shift slightly to reflect increased urgency while remaining professional.

Sample Letter:

Dear [Customer Name],

We reached out on [Date of Last Contact] regarding the overdue invoice [Invoice Number]. As of today, this invoice is 60 days past due. Please contact us as soon as possible to arrange payment or discuss a resolution.

Thank you,

[Your Company Name]

 Net 90 Days Past Due

At 90 days, it’s time to reference previous outreach and make the consequences of non-payment clear.

Sample Letter:

Dear [Customer Name],

Invoice [Invoice Number] is now 90 days past due. Despite multiple attempts to contact you, we have not yet received payment. We may begin a formal collections process if payment is not received immediately. Please call us today to resolve this matter.

Thank you,

[Your Company Name]

Net 120 days past due

By 120 days, your business may be considering legal action or reporting the debt. This final notice should be firm and direct.

Sample Letter:

Dear [Customer Name],

The outstanding balance for invoice [Invoice Number] is now 120 days overdue. We have made multiple attempts to resolve this matter without success. As a result, we are prepared to take further action, which may include legal proceedings and reporting the delinquency to a credit bureau.

To avoid escalation, please contact us immediately.

Thank you,

[Your Company Name]

Automate dunning letters to save time

Manually creating and tracking dunning letters in spreadsheets can lead to inconsistent follow-ups and missed revenue. With Sage AR Automation, your team can:

• Generate dunning letters based on invoice aging
  
• Schedule follow-up reminders
  
• Track responses and escalate when necessary
  
• Customize templates and personalize by customer.
  

Automation helps maintain consistent communication while reducing manual work—ensuring no past-due account falls through the cracks.