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Author: thegiftmall | Total views: 52 Comments: 0
Word Count: 1173 Date: Mon, 23 Mar 2009 9:31 PM

How to Improve Your Credit Score

Having a damaging credit record can hurt you in many ways. It may prohibit you from making an important purchase such as a home, car, computer or vacation. Without a healthy credit report you are severely limiting yourself from possible lenders. If you do find a lender you will undoubtedly be charge exorbitant interest rates far exceeding what recipients would receive if their credit history is in good standing. So how can you fix your credit score if you've been less than diligent with repayments to creditors? Well contrary to what many advertising scams will tell you, you can't fix your credit overnight. In most instances it takes 7 years for a payment infraction to be deleted from your credit report. If you were to file bankruptcy it would take 10 years. Obviously fixing the problem before taking such drastic measures is desired. Bankruptcy must be used only as a last case scenario and the implications must be fully understood before proceeding with such severe measure. Besides bankruptcy staying on your credit history for 10 years and posing large problems if you decide to seek out a financial lender, it can also impact other areas of your life. For instance you may be rejected from certain jobs, prohibited from taking on certain responsibilities and positions within your own company if you are a business owner and you will still be in the bad books of the people who you may require to lend you money.

There is no way to fix your credit overnight no matter what the advertisements claim. The bottom line is that if you are faced with difficult financial situation you must first look to fix the problem yourself through using basic budgeting guidelines. If you are not good at this, you may be able to hire a professional personal money manager to do this for you. Next you must figure out what your rights are and try to amend problems before they arise. In most cases, creditors would be wiling to work with you and come up with some repayment alternatives rather than sending your delinquent account to a collection agency. If it has gotten so bad that you have creditors calling your house all the time, you must research what your rights are. Collection agencies are heavily restricted by laws but that doesn't stop some agencies from taking advantage of some less informed individuals. For instance, collection agencies are only allowed to call during certain times of the day and in most cases must cease all calls if you request them to do so in writing.

If you are experiencing financial problems the best thing to do is get informed. Learn the laws and research your options.

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$350 million in bad checks are written each and every week. That fact alone makes bad checks a serious problem for American businesses. It is almost inevitable that, if your business accepts checks, you have been affected by this. As well as being stuck with bank fees for depositing a bad check - and the very real possibility that the bad check could impact your bottom line - there is the time, aggravation and cost associated with recovering the funds. It is often the case that recovering the check can incur more in costs than the value of the original debt. Inevitably, many smaller businesses write off bad checks, believing that they cannot afford to pursue the debt. However, there are a number of ways your business can fight back and minimize the pain of bad check recovery.

IT'S AN INNOCENT MISTAKE...

For small and mid-sized businesses, the first recourse is to call the customer and explain the problem. Don't immediately assume that the customer intended to defraud your business. It is often true that an innocent mistake has been made and a calm, reasoned telephone call will recover your funds and keep what may be a valuable customer. Please be aware that threatening a debtor with publicizing their name or notifying their employer is illegal, so speak only to the person owing the funds and stay cool !

PURSUING THE DEBT

In most States, you are required to send a certified letter to the check writer before you can institute court proceedings. You may request that the debtor also repays the bad check fee you have incurred. The check writer is usually required respond within 10 or 30 days. This varies by state, so please check with your State Attorney General's office. Again, a calm and reasonable tone often works well and will ensure you stay within the law. Reviewing the Fair Debt Collection Practices Act ( http://www.fair-debt-collection.com/fair-debt-act.html ) before you draft your letter or make a call is highly recommended.

While these two methods are time and cost-effective, if you have still been unable to recover the check the obvious next step is to institute court proceedings or hire a professional debt collection agency. However, these are time consuming and potentially expensive options and - for many small businesses - may mean that the cost outweighs the benefit. Nevertheless, there are alternative check recovery methods that don't have these possible downsides.

CHECK ENFORCEMENT UNITS

Some areas now have a check enforcement or check recovery unit that is part of the state or district attorney's office. These are not available in every state and the services provided do vary. In general, though, the check enforcement unit will investigate and prosecute the debtor on your behalf and you will receive the full face value of the check. Contact your local District Attorney's office to see if this service is offered in your area.

ELECTRONIC CHECK RECOVERY

A better all round option is to consider using one of the electronic check recovery services now available. There are many advantages to electronic check collection over traditional recovery methods, not least the fact that many of the companies offering this service charge no fees to your company. Other benefits include:

i) Increased Recovery Rates : The National Automated Clearinghouse Association (NACHA) reports increases in recovery rates by as much as 50% in comparison with traditional recovery methods.

ii) Low Recovery Costs: No bank fees for redepositing an NSF check electronically.

iii) Benefits to Customers: No need for customers to receive collection letters and calls or supply a money order or cashier's check.

iv) Fast Recovery Times: Traditional recovery methods can take between 30 and 60 days. On average, electronic check recovery takes 7 days, after which time the recovered check is deposited into the merchant's account.

v) Out of town checks are handled as quickly and easily as local checks.

While bad checks are a fact of business life, recovering funds owed to you is not the herculean task it might first appear. You can fight back and still avoid many of the headaches that have been traditionally associated with pursuing a debt.