A large majority of people are in financial difficulties today, finding they are unable to pay their bills for many reasons--lost jobs due to being fired or cut-backs, death, a lengthy hospitalization for terminal diseases, and disabilities. Many people are beginning to contact a debt consolidation lead creditor to avoid filing bankruptcy and maintain their credit rating. The truth is, most people get into debt so gradually they do not even notice it, until the money is suddenly inadequate to pay all the necessary bills.
The act of consolidating debts refers to more than one bill being grouped together into a single low payment, easing the individual's financial strains while simplifying their lives, and saving quite a bit of money at the same time. In today's society, a debt consolidation lead creditor seems to be the answer for many, whereas at one time bankruptcy was all there was, short of skipping town in the middle of the night with nothing but a backpack of meager belongings.
There are many advantages and disadvantages for debt consolidation, as any debt consolidation lead creditor will agree. A few of the advantages are: taking a new loan out in order to pay off a group of old loans, which gives a person good credit in the long run as long as the new loan is paid on time; credit cards are paid off with lots of interest saved; reducing or removing old medical bills; and reducing large numbers of monthly payments at the same time.
Probably the largest advantage, according to many debt consolidation lead creditor professionals, is that it removes stress on all levels—lots of stress! By the time the average individuals approach a debt professional for help, they will owe many lenders with a wide variety of debts and gathering excess interest, all the time never quite having enough money to quite cover them all at the end of the month. Over-due bills causes multiple phone calls, people knocking at the door, tons of bills in the mail—all stressing a money-strapped household to the point they do not know which way to turn. The major point for debt consolidation is that it makes a budget workable, allowing for a feeling of "finally we are debt free". It is pretty hard to make a budget work with either no money at all or not enough money to cover most bills.
But on the other side, a debt consolidation lead creditor may also advice against it for several reasons. For one reason, if a person goes into uncontrollable debt once, what will prevent them from doing it again? Lacking self-discipline or having inadequate financial knowledge will allow the debts to run up again—again—and again. Also, by extending a debt consolidation loan the total debt will be increased in the long run but it will be still there. Small payments do not mean the loan is made smaller, only longer in duration.
The newly developed creditor recovery corporation is an extremely massive system that has been recently developing in our country. It provides creditor companies with a solution to the constant and increasing problem of non-payment, slow payments, or totally delinquent accounts--while they are still collectable. A system management business that operates as "client service bureau," the creditor recovery corporation business is used with a combination of services that are combined with the most advanced forms of technically developed electronic data interchange to get the job done.
One such example of a creditor recovery corporation, MaxCollect, offers creditor companies with debt problems a unique solution that is considered to be highly effective in collecting all areas of debts. Another creditor recovery corporation company, MAXIMUS, is a company specializing in government and industry solutions that has recently contracted with the government student loans department for financial recoveries.
But regardless of the name of the large corporation, the creditor recovery corporation is a big business currently being used to seek out non-paying consumers who cannot pay their bills for one reason or another. They work for the smaller businesses, larger organizations, and the old-fashioned "ma and pa corner business" at a negotiable fee of $10 to $25 dollars per consumer—all in the name of a very valuable commodity, "Increased Cash Flow!"
The traditional credit agencies which have attempted to assist the many creditors, but have not been able to achieve a high success. It has been decided by both businesses and the creditor recovery corporation, that credit agencies produce poor results and charge too much of it. The new systems fill a time frame between the billing dates of 60 days, and the 180 days when a credit agency is approaches, increasing the cash flow. It has been found that the older the bill is, the less likely it will be paid.
The process of the creditor recovery corporation business is quick and proactive:
• Initial mailing of a bill, statement or invoice
• Sending a letter from the internal collection division
• Collection phone calls are made
• Third party is contacted, such as an attorney or collection agency
• Credit bureau report
• Litigation with less than 1% of all external collections collected upon
The creditor recovery corporation uses the last five components of the collection process, which involves the above 2 through 6 steps. With the new recovery corporation using their automated and systematic internal system, the debts are collected faster, expenses are cut, and there are more satisfied customers. And meanwhile, the collection agencies are being eliminated and more money is being put into the system.
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