Are you overwhelmed with debt?

13 07 2011

There are several options that consumers have to deal with their debt before considering bankruptcy. Declaring bankruptcy may be helpful in certain situations but it should always be used as a last resort. Depending on your level debt and self discipline, there are different options that you should consider.
Organize yourself
Contact your creditors directly and try to work out a payment plan. Try explaining to them the cause of your financial troubles, they may be understanding. Don’t wait until you have debt collectors calling you because that means your creditors have given your debt away to someone else which may or may not affect your credit. If you have secured debt like a home or car loan those objects may be repossessed until the full payment of the debt is received. If you foresee that you cannot make the payments on time, If possible, the best way to avoid this is sell the car or house and pay off the loan before the amount builds up more than you can handle.

Work with credit counselors
If you cannot organize your finances on your own there are organizations out there to help people with these exact problems. They usually offer services online or on the phone. They can help advise you on managing your debts and money, develop a budget and offer free educational materials.
Enroll in a debt management plan
Debt management plans or DMPs are programs that work with your creditors and schedule timely regular monthly payments for you unsecured debt. In exchange for inactivation of the accounts or credit cards the creditors may lower interest rates or fees. These are not for everyone though. If you fail to make a payment while enrolled in one of these programs it may affect your credit even worse.
File for bankruptcy
This should be done only as a last resort. The results of this are long lasting and can stay on your credit report for up to 10 years. This can make it almost impossible to buy a house or car or even get a job. But if it is your only option, it is an option.





Small Business Loans for 2011 Unlikely: Businesses turn to Collections for Cash

3 12 2010

Cash is needed in order for any business to operate.  In the past it was easier for Banks to lend money in order for the business to continue operating but since banks have tightened up giving loans to small businesses, many have been forced to max out their credit cards carrying further debt into 2011. Businesses will continue to need economic relief. The question is “where will it come from?”

 

Fico claims that banks as Lenders may not be able to meet the credit demands of small businesses seeking relief in the future.  59% of those surveyed expect small businesses to request a higher amount of credit over the next six months, but less than 37% expect lenders to increase the amount of credit given to those small businesses.

 

According to Standard & Poor’s Data, only four companies last month received leveraged loan covenant relief for a total of $883 million in leveraged loans.  This is the lowest amount of relief given since February 2008.

 

S&P expects covenant relief activity to be high in the beginning of 2011 as checks due to lender agreements from 2008 and 2009 are paid.  But as the year goes on, businesses may not be able to get relief from banks.

 

Until problems in mortgage portfolios are solved and private sector employment grows, the gap between credit demand and credit supply is unlikely to close. Along with this, the number of failing banks is increasing as well.  In 2010, 141 banks failed, making it the worst year ever, and this list is expected to continue to grow.

 

With banks unable to loan money, small businesses will seek other ways to generate cash to operate.  THERE IS A SOLUTION.  Businesses can rely on Commercial Collections professionals to recoup lost cash flow from customers who have not paid. Although times continue to be hard professional B2B collection agencies have the tools, the staff and the expertise to put your receivables on the TOP of their bills to be paid.

 

Caine & Weiner reported that out of the businesses surveyed, 57.5% plan to place accounts for collection in order to generate cash and the sooner the better. Credit and Collection managers also plan to reduce credit lines given to clients and to initiate collection sooner in order to protect their accounts receivables and generate money as banks are unable to offer financial relief in the upcoming year.

 

The bottom line is that businesses can no longer continue to be their customer’s bank and CFO’s; Controllers and Credit Managers must be more proactive in 2011. It can be argued that revenue generation is the most critical function of a company.  However, that revenue must be converted into cash.  Cash is the lifeblood of any company.  Every dollar of a company’s receivable must be managed and collected.





International Debt Collection

19 11 2010

With the growth of a global economy, more and more companies are able to advertise and sell their products and services in other countries as well as their own.  Global economies also lead to the expansion of debt collections into foreign countries. When doing business in a different country, you need experience and knowledge of the countries government and laws, trade restrictions and requirements, and the differing currencies and credit reporting criteria.

Debt Collection Agencies collecting from or for companies outside the United States need to consider a few factors:

1. Language – Working with people from different countries often presents a language barrier.  It is important to have a translator for communication.

2. Time Zones – Working across time zones presents communication challenges and time constraints regarding when you can talk with someone in the opposite time zone.

3. Foreign Partner Relationships – Gaining the cooperation and a positive attitude while working with a foreign country will build a quality relationship between the client, collection agency, and debtor.

4. Laws – It is important for a debt collection agency to understand their country’s laws and the other country’s laws and policies regarding credit, collection, and the court systems.

At Butler Robbins & White Global Revenue Recovery, we are able to collect foreign debt with our unique research.  We may be able to transfer a judgment to a foreign country. We are sensitive to the different cultures we work with and offer an extended arm, so companies are able to interconnect with the United States.

Let us help you! Email us today at RKluge@brwcollect.com