Saturday, 19 February 2011
Deanem Collections: Improving your credit file.
Deanem Collections: Improving your credit file.: "I read a fascinating article entitled “Healing a Wounded Credit Score” in todays New York Times by Tara Siegel Bernard and while the informa..."
Improving your credit file.
I read a fascinating article entitled “Healing a Wounded Credit Score” in todays New York Times by Tara Siegel Bernard and while the information is written for an American reader, I feel that similar information should be made available to those in the UK.
Once people find out that I run a debt collection agency, the one question I’m generally asked is how can I improve my credit score? Especially in light of numerous companies advertising “Credit Repair services” or “We can improve your credit worthiness”, the bottom line is that any improvement in your credit file takes time, hopefully the following will be of assistance.
Often the first time that someone realise that they have a problem, is when they have a credit application rejected. However upsetting this is, it should prove to be a welcome wake up call and your first action should apply to Equifax (www.equifax.co.uk) or Experian (www.creditexpert.co.uk) for a copy of your credit file.
The reason that you should check your credit file is that all credit providers will base their decisions on your “score” and what is shown in your file. Decisions are made by checking how many credit applications have been made in the previous 6 – 12 months,. These could be for a mobile phone or an insurance policy or a store card too many and you won’t be awarded credit. Likewise, too few will also count against you. They will then note if you are or have ever been in default and finally if you’re the subject of any County Court Judgments or the subject of an IVA or have been declared Bankrupt. If your file shows no adverse information, you should appeal the decision.
However, if you’re file shows wrong information, say that you are in arrears or defaulted on say an insurance premium your first action should be to contact the company concerned and ask that they correct the entry. If they won’t then contact Equifax & Experian and they can force the company to make the correction.
What should you do if the information is correct? Simple if it’s just the case that you’ve missed a payment the best you can do is make sure for the next 6 months is that you don’t miss any payments. If you haven’t missed a payment, check how many applications you’ve made and don’t apply for anything for say 6 months.
What should you do if you were declared Bankrupt or entered in to an IVA and your bankruptcy /IVA has been satisfied?
First thing that you must realise is that for your Bankruptcy /IVA status will be shown on your credit file for the next 6 years. However, once you have been discharged you can start the process of repairing your credit worthiness. The first thing you will need to do, if you haven’t got one is apply to a bank for an account. The account you’ll be offered is called by different names by each bank, it could be called an Easy Account or cash account or even a non-status account. Whatever it is called the bank will not offer you a current account that pays interest or provide you with a cheque book.
Once you have an account open, you will need to show that you can maintain a healthy account for at least 6 months. After that you should look at applying for a credit card which is aimed at people with a poor credit history, such cards are Vanquis, Granite or Capitol One. While you may be offered an account you will only be given a small credit limit of around £250. Please be aware that these cards charge a very high interest rate if you do not settle your account in full at the end of each month. Provided that you maintain a healthy use during the first 6 months, the card provider will generally increase your credit limit to say £500. This is your first sign that you have begun to repair your credit file.
I know that having been declared Bankrupt, a credit card is probably the last thing you want to have and if you feel this way then you should consider a pre-paid credit card. This card is not a credit card but works exactly like the credit cards that you would have known and abused over the years. The big difference is that before you can use it, you have to deposit money in to your card account. The good thing about these cards is that you are not credit checked when you apply, but they still count to improving your credit worthiness and look no different to a standard credit card.
I hope that this is of assistance but if you have any questions please do not hesitate to email me david@deanemcollections.co.uk. Or if you prefer make an appointment to see one of the advisors attached to the C.A.B.
For further details about David or Deanem Collections Ltd please do not hesitate to visit our website www.deanemcollections.co.uk
Once people find out that I run a debt collection agency, the one question I’m generally asked is how can I improve my credit score? Especially in light of numerous companies advertising “Credit Repair services” or “We can improve your credit worthiness”, the bottom line is that any improvement in your credit file takes time, hopefully the following will be of assistance.
Often the first time that someone realise that they have a problem, is when they have a credit application rejected. However upsetting this is, it should prove to be a welcome wake up call and your first action should apply to Equifax (www.equifax.co.uk) or Experian (www.creditexpert.co.uk) for a copy of your credit file.
The reason that you should check your credit file is that all credit providers will base their decisions on your “score” and what is shown in your file. Decisions are made by checking how many credit applications have been made in the previous 6 – 12 months,. These could be for a mobile phone or an insurance policy or a store card too many and you won’t be awarded credit. Likewise, too few will also count against you. They will then note if you are or have ever been in default and finally if you’re the subject of any County Court Judgments or the subject of an IVA or have been declared Bankrupt. If your file shows no adverse information, you should appeal the decision.
However, if you’re file shows wrong information, say that you are in arrears or defaulted on say an insurance premium your first action should be to contact the company concerned and ask that they correct the entry. If they won’t then contact Equifax & Experian and they can force the company to make the correction.
What should you do if the information is correct? Simple if it’s just the case that you’ve missed a payment the best you can do is make sure for the next 6 months is that you don’t miss any payments. If you haven’t missed a payment, check how many applications you’ve made and don’t apply for anything for say 6 months.
What should you do if you were declared Bankrupt or entered in to an IVA and your bankruptcy /IVA has been satisfied?
First thing that you must realise is that for your Bankruptcy /IVA status will be shown on your credit file for the next 6 years. However, once you have been discharged you can start the process of repairing your credit worthiness. The first thing you will need to do, if you haven’t got one is apply to a bank for an account. The account you’ll be offered is called by different names by each bank, it could be called an Easy Account or cash account or even a non-status account. Whatever it is called the bank will not offer you a current account that pays interest or provide you with a cheque book.
Once you have an account open, you will need to show that you can maintain a healthy account for at least 6 months. After that you should look at applying for a credit card which is aimed at people with a poor credit history, such cards are Vanquis, Granite or Capitol One. While you may be offered an account you will only be given a small credit limit of around £250. Please be aware that these cards charge a very high interest rate if you do not settle your account in full at the end of each month. Provided that you maintain a healthy use during the first 6 months, the card provider will generally increase your credit limit to say £500. This is your first sign that you have begun to repair your credit file.
I know that having been declared Bankrupt, a credit card is probably the last thing you want to have and if you feel this way then you should consider a pre-paid credit card. This card is not a credit card but works exactly like the credit cards that you would have known and abused over the years. The big difference is that before you can use it, you have to deposit money in to your card account. The good thing about these cards is that you are not credit checked when you apply, but they still count to improving your credit worthiness and look no different to a standard credit card.
I hope that this is of assistance but if you have any questions please do not hesitate to email me david@deanemcollections.co.uk. Or if you prefer make an appointment to see one of the advisors attached to the C.A.B.
For further details about David or Deanem Collections Ltd please do not hesitate to visit our website www.deanemcollections.co.uk
Sunday, 13 February 2011
The Mayan Calendar
What can business learn from the Mayan Calendar?
There a couple of things I’ve discovered over the last few months. The first is that according to the Mayan calendar, the world as we know it will cease to exist in 2012. The second thing is that all substances be it animal, mineral or vegetable are really billions & billions & billions of molecules vibrating at very high speed and the way we get our shapes is by the speed that these molecules vibrate.
While interesting as these facts are I can hear you ask what have they got to do with credit control. On the face of it, not a lot, but if you look a bit deeper the Mayan Calendar you’ll find the answers too many of your everyday cash flow problems.
As I mentioned, according to the calendar the world as we know it will end in 2012, the question is what can we learn from this. Well if the world as we know it does end, will it be that the world stops turning and all the molecules stop vibrating, in which case go out and enjoy yourselves and don't worry about your unpaid invoices. I prefer to think that when they worked out the calendar they couldn’t think past 2012.
However, just in case I’m right and the world continues in to 2013 and beyond and you intend to remain in business, then you are going to have to make sure that you have a firm credit control policy. I heard this week from “John” who had attended one of my credit control workshops. I was delighted to hear that since he has put in to practice the advice I gave, his debtor days had dropped to zero and more people are now paying early.
I had explained that if you wanted to improve your debtor days, the best way was to notify your clients that on ex day prices would be going up by say 10%. However, if they could settle their invoices within 7 days then the price rise would be held at 5%. If they could pay on delivery, the old price would remain. "John" was concerned that he would lose his customers if he put up his prices, but decided to do it as the majority of his "customers" took 60 days + to settle. He was amazed that no only didn't the clients object, the majority took advantage of the lower rate and now pay on delivery.
For those who haven’t yet attended one of my workshops the next ones are being held on Thursday 10 March at the Herts Business Expo being held at the Ramada Jarvis Hotel. To attend you will need to register by visiting www.thehertfordshirebusinessexpo.co.uk and follow the link.
If you would like to learn more about David and or Deanem Collections Ltd visit www.deanemcollections.co.uk and find out why we are "The Liferaft in the sea of Debt"
While interesting as these facts are I can hear you ask what have they got to do with credit control. On the face of it, not a lot, but if you look a bit deeper the Mayan Calendar you’ll find the answers too many of your everyday cash flow problems.
As I mentioned, according to the calendar the world as we know it will end in 2012, the question is what can we learn from this. Well if the world as we know it does end, will it be that the world stops turning and all the molecules stop vibrating, in which case go out and enjoy yourselves and don't worry about your unpaid invoices. I prefer to think that when they worked out the calendar they couldn’t think past 2012.
However, just in case I’m right and the world continues in to 2013 and beyond and you intend to remain in business, then you are going to have to make sure that you have a firm credit control policy. I heard this week from “John” who had attended one of my credit control workshops. I was delighted to hear that since he has put in to practice the advice I gave, his debtor days had dropped to zero and more people are now paying early.
I had explained that if you wanted to improve your debtor days, the best way was to notify your clients that on ex day prices would be going up by say 10%. However, if they could settle their invoices within 7 days then the price rise would be held at 5%. If they could pay on delivery, the old price would remain. "John" was concerned that he would lose his customers if he put up his prices, but decided to do it as the majority of his "customers" took 60 days + to settle. He was amazed that no only didn't the clients object, the majority took advantage of the lower rate and now pay on delivery.
For those who haven’t yet attended one of my workshops the next ones are being held on Thursday 10 March at the Herts Business Expo being held at the Ramada Jarvis Hotel. To attend you will need to register by visiting www.thehertfordshirebusinessexpo.co.uk and follow the link.
If you would like to learn more about David and or Deanem Collections Ltd visit www.deanemcollections.co.uk and find out why we are "The Liferaft in the sea of Debt"
Wednesday, 9 February 2011
Deanem Collections: Bankruptcy versus IVA or CVA
Deanem Collections: Bankruptcy versus IVA or CVA: "I'm grateful for the following article published in Debt Management Today and the Insolvency Service for revealing that over 135,000 people ..."
Bankruptcy versus IVA or CVA
I'm grateful for the following article published in Debt Management Today and the Insolvency Service for revealing that over 135,000 people were declared insolvent in 2010.
Neil Morrissey recently opted for an individual voluntary agreement rather than bankruptcy when his investments in a property company resulted in him falling into financial difficulties, while the Eastenders actor Joe Swash opted for bankruptcy rather than an IVA when he also found himself with debt problems. So, which is the best option if you find yourself with money troubles?
Credit-rating agencies such as Experian do not really differentiate between bankruptcies and IVA’s, but there are still some crucial differences to be considered when weighing up the two options.
Bankruptcy is discharged after a year but stays on one’s credit file for five years, which could result in difficulties getting credit and contracts. IVA’s also affect one’s credit rating and may also lead to difficulties getting jobs in financially sensitive positions.
If you have no assets and no income then bankruptcy is probably the best option. However, depending on your profession, such a declaration could threaten your career: solicitors and accountants would be fired, so for them an IVA would be the better option.
Also, bankruptcy will be in the public domain. It could be printed in newspapers and you won’t be able to control who finds out about it, whereas an IVA is a much more private affair, which - while it might be published on the Insolvency Service’s website - won’t be printed in papers. But then, bankruptcy offers an escape from creditors that an IVA cannot match. You can keep your house and enough to live on and in many cases the rest of your debts may be written off after one year, as long as you haven’t concealed your ability to repay creditors during that period. However, there are some debts - like student loans and court fines – which will never be written off. With an IVA however, you may well have to pay an upfront fee and you can only take out an IVA if you have the ability to pay back your creditors.
In business an IVA is called a CVA however the effect is the same.
The key is to get advice early. These options should be seen as a last resort. Talk to a specialised debt advisor. If you are unsure who to speak to please contact me at david@deanemcollections.co.uk and I’ll be delighted to point you in the right direction.
If you would like to find out more about David and Deanem Collections ltd, please do visit the website www.deanemcollections.co.uk
Neil Morrissey recently opted for an individual voluntary agreement rather than bankruptcy when his investments in a property company resulted in him falling into financial difficulties, while the Eastenders actor Joe Swash opted for bankruptcy rather than an IVA when he also found himself with debt problems. So, which is the best option if you find yourself with money troubles?
Credit-rating agencies such as Experian do not really differentiate between bankruptcies and IVA’s, but there are still some crucial differences to be considered when weighing up the two options.
Bankruptcy is discharged after a year but stays on one’s credit file for five years, which could result in difficulties getting credit and contracts. IVA’s also affect one’s credit rating and may also lead to difficulties getting jobs in financially sensitive positions.
If you have no assets and no income then bankruptcy is probably the best option. However, depending on your profession, such a declaration could threaten your career: solicitors and accountants would be fired, so for them an IVA would be the better option.
Also, bankruptcy will be in the public domain. It could be printed in newspapers and you won’t be able to control who finds out about it, whereas an IVA is a much more private affair, which - while it might be published on the Insolvency Service’s website - won’t be printed in papers. But then, bankruptcy offers an escape from creditors that an IVA cannot match. You can keep your house and enough to live on and in many cases the rest of your debts may be written off after one year, as long as you haven’t concealed your ability to repay creditors during that period. However, there are some debts - like student loans and court fines – which will never be written off. With an IVA however, you may well have to pay an upfront fee and you can only take out an IVA if you have the ability to pay back your creditors.
In business an IVA is called a CVA however the effect is the same.
The key is to get advice early. These options should be seen as a last resort. Talk to a specialised debt advisor. If you are unsure who to speak to please contact me at david@deanemcollections.co.uk and I’ll be delighted to point you in the right direction.
If you would like to find out more about David and Deanem Collections ltd, please do visit the website www.deanemcollections.co.uk
Sunday, 6 February 2011
Deanem Collections: Moral Dilemma
Deanem Collections: Moral Dilemma: "In todays Mail on Sunday, I read in Tony Hetheringtons’ column (page 82) that Philips Collection Services Ltd one of my business rivals is c..."
Moral Dilemma
In todays Mail on Sunday, I read in Tony Hetheringtons’ column (page 82) that Philips Collection Services Ltd one of my business rivals is currently trading without a Consumer Credit Licence. According to the article “Their licence ran out last September. The company is allowed to stay in business as long as officials are considering a renewal application. But the fact that this process has dragged on for more than 5 months may indicate that you and I are not the only people to have qualms about the way this debt collector acts.”
At the moment it is a legal requirement for any debt collection agency that collects their clients’ money must be registered.
The moral dilemma was, should I pass this information on to prospective clients who I know use this agency, or should I not. If I did pass on this information would it make me look petty and enjoying another’s misfortune or would the prospective client appreciate hearing this news?
I decided that it was worth the risk and sent out an email to the various people working at companies who I believed are currently using or have used that agency. I did blind copy and attach a copy of the column to back up my comments.
For those reading this blog I must point out that the nearly all debt collection agency are registered and legal. However if would like to know what makes a debt collection agency not only legal but moral and ethical please do not hesitate to contact me at www.deanemcollections.co.uk
At the moment it is a legal requirement for any debt collection agency that collects their clients’ money must be registered.
The moral dilemma was, should I pass this information on to prospective clients who I know use this agency, or should I not. If I did pass on this information would it make me look petty and enjoying another’s misfortune or would the prospective client appreciate hearing this news?
I decided that it was worth the risk and sent out an email to the various people working at companies who I believed are currently using or have used that agency. I did blind copy and attach a copy of the column to back up my comments.
For those reading this blog I must point out that the nearly all debt collection agency are registered and legal. However if would like to know what makes a debt collection agency not only legal but moral and ethical please do not hesitate to contact me at www.deanemcollections.co.uk
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