Credit despite debt collection

Debt collection is a so-called receivables management that helps companies to collect outstanding invoices. Outstanding receivables tarnish a company’s solvency. In addition to the high costs, there are no customer payments, which means that the company can no longer meet its own liabilities. Debt collection simplifies the effort and takes the work off the company and demands the outstanding amounts. The company has not yet issued any reminders.

If a debtor makes it this far, then he is noted in a collection procedure, which has a negative impact on his creditworthiness. In order to pay the debt, the debtor needs a loan despite collection. It is not easy.

The outlook

The outlook

Whoever grants loans demands a sufficiently high and regularly incoming income. This is also the case with credit despite debt collection. However, the creditworthiness is more in the focus of the banks here. The customer can assume that he will not find many lenders who do not have a comprehensive credit rating. By activating debt collection, the customer severely restricted his creditworthiness.

The customer should know that even though he has not paid the invoices and received the first reminder from the collection company, he will not automatically receive a negative entry in his Credit bureau. Also, debt collection must not threaten the customer or put it under pressure. Many customers who have been contacted by a debt collection agency about outstanding claims must not threaten the customer with a negative entry in Credit bureau. That has resulted in a court decision.

In general, a Credit bureau entry can only be made through open invoices if there are at least two reminders, if the debt collection has informed the debtor of the entry. This has been regulated to protect the debtor. He must be able to check the amount of the claim and, if it is not correct, to contest the claim.

If the debtor does not respond to the warnings, then debt collection has the right to report the claims of Credit bureau. However, there are very strict requirements. As a result, he receives no credit from a Agree bank.

Does Credit bureau-Free Credit Help?

Does Credit bureau-Free Credit Help?

If customers are to approve a loan despite collection, the customer must have a sufficiently high income that is above the garnishment-free limit. The customer should know that due to the collection claims, more attention is paid to his creditworthiness. There are not many lenders who do not do a Credit bureau check. The bank draws up a budget for all loan seekers. In doing so, she puts income against expenses and checks whether there is still financial scope. If this is the case, a Credit bureau-free loan could be approved, provided that it finds a conventional lender.

With a Credit bureau entry, there is usually the addition of a credit broker who can provide the customer with a Credit bureau-free loan despite collection. The previously mentioned income must be available and a permanent job for at least one year. The employment contract must not be limited and there may be no trial period.

The donors come from abroad, where there is no Credit bureau institution like here in Germany. The loan is also not entered. However, the bank will take a look at the public debt register. If there are bankruptcies, oaths of disclosure, loan terminations and foreclosures, this will be an absolute exclusion criterion for a loan despite debt collection.

The bank provides two loan amounts, one for 3,500 USD and one for 5,000 USD, depending on the credit rating. Both loans have a term of 40 months. The rate for the 3,500 USD loan is 105.00 USD for the 5,000 USD credit 150.00 USD. If the customer does not have sufficient income, he could take a guarantor into the loan despite collection. But to what extent the foreign banks have to recognize a guarantee under German law must be questioned.

Other options

Other options

If the Credit bureau now states that a debt collection agency has been engaged and that enforcement is due due to the claims, the customer cannot receive a loan despite debt collection. Here he would have to look for other options. He will also encounter difficulties when buying consumer goods. If the dealers are also generous, the Credit bureau is still queried and the customer cannot use this credit with the entry.

In a financial emergency, many loan seekers honor promises that are unsustainable. The internet is full of it. Loans with income and without are promised, with an oath of disclosure even with foreclosure. The customer should know that this is all hot air. Banks have their conditions, some of which are even regulated by law. In such a precarious situation, she considers the default risk for a loan to be too high despite collection.

Customers who are in such a situation have also been taken in by dubious credit brokers. With lurid promises, customers are attracted and preliminary costs or prepayment are required. Customers never see their money again and never see a loan.

If the customer finds a loan despite being debt-free, so if he is predestined for this loan, he should pay his installments on time. If there are any payment problems, the bank will initiate the garnishment immediately. If it has been seized before, it is the absolute loan.

But what remains for the customer who urgently needs money. Even if he pays his debts when collecting, the negative entry remains for three years.
These customers could try private lenders. There are platforms where private investors offer a loan to loan seekers. The customer must create a profile and present their credit request in a trustworthy and understandable manner. If some investors trust, a loan could be considered despite debt collection. However, these donors also query Credit bureau.

Anyone in such a hopeless situation should not apply for a loan, but rather get in touch with a debt counseling service. The employees there are trained and can negotiate with creditors, so that a reasonable installment plan could be drawn up.

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