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Selling leadership in a changing market
A niche that can help increase your income: Outsource borrowers with bad creditSherene Costanzotype keywords here..SEPERATE BY COMAS ONLY(,)
Do you know that outsourcing your potential clients with
problematic credit can save you time and earn you more money? A
lower credit score can be a loan officers most frustrating element
when creating the best loan to suit a client; however, when the
score just does not fit the puzzle, there are options to improve
it. Using this niche can help you increase your business. Many loan
officers spend time trying to improve their clients score, although
this can be extremely time-consuming and frustrating. This time
could be better spent preparing loans for clients with a sufficient
score. You can send any client whom you cannot finance to a
reputable credit restoration company that can assist your clients
with their credit problems, so you dont have to.
How will outsourcing problematic clients to a reputable
credit restoration company help you earn more money?
Outsourcing these clients will save you time and optimize your
productive hours. Spend your time on clients who do qualify, so you
feel more productive each day. However, this doesnt mean that you
have to turn away those who dont qualify. You can refer them to a
reputable credit restoration company that you trust. A reputable
company will help the client increase their score and send them
back your way. How will this help you earn more money? You are
spending less time on unqualified leads, which allows you to
concentrate on the qualified leads and gain a potential future use
for those bad leads.
How does credit restoration work?
A credit restoration company can help you improve your clients
credit rating within as little as 30 days. There are several
companies out there. Credit restoration is not a debt management or
negotiation company. The primary purpose of a credit restoration
company is to assist a consumer with increasing their score. Most
companies use the Fair Credit Reporting Act (FCRA) that protects
consumers rights. The act states that the consumer has the right to
question any unverifiable, inaccurate or erroneous information
reported on their credit file with any of the three major credit
bureaus (Equifax, Experian and TransUnion). This includes:
collections, late payments, charge-offs, judgments, tax liens,
foreclosures, garnishments and bankruptcies. The credit bureaus
have 30 days to verify the account in question with the original
creditor. If the original creditor does not verify the account
within 30 days, the delinquent account or late payment must be
corrected or deleted from the credit file. At this point, the score
will be immediately adjusted with the three major credit bureaus.
This process is the stem of credit restoration and most companies
use this process to improve a clients score. There are companies
that may take an extra step to consult the client on how to obtain
and maintain excellent credit. There are also companies that may
help the client settle accounts that are not removed during the
process.
How much does the service cost and how long does it
take?
The average fee for credit restoration is approximately $400. Some
companies have fees as low as $250 or as high as $800. Be cautious
of the companies that charge higher fees because you can basically
receive the same service for a lower fee. Also, some companies may
charge monthly fees and drag the process out over a year. This
process could be completed within 90 days, so there is no reason to
pay a company for a year or more when the same process can be
accomplished in 90 days for one fee. Do-it-yourself kits are also
an option, but most clients do not have the time or patience to do
the process on their own. It is generally better to pay and have
the service done professionally.
How effective is the credit restoration process?
Credit restoration is extremely effective, although it is
practically impossible to determine how much one specific action
will affect the score. The credit score is based solely on the
information obtained from an individuals credit report. If more
positive than negative information reports, the score is usually
better. A change of one factor can impact the score, however, the
amount of impact depends on how it relates to other factors and
history included in the report. For example, a person with a long
credit history and several positive accounts will be affected less
by five late payments than a person who has just recently
established credit and only has five accounts total, with all five
accounts reporting late.
The key is to change the factors that help increase the score,
which in turn, will increase the chances of boosting the score.
However, it is the responsibility of the client and it is extremely
important to remember that building a good credit history over
time, by paying bills on time, having a variety of accounts
established, and keeping balances below 40 percent of your credit
limits, is the best assurance to having and maintaining excellent
credit. For this reason, it is impossible for any credit
restoration company to guarantee you that your score will increase,
though in most cases it will. Remember, the fee is for a service
performed. The restoration service is for consulting and
challenging, in order to help improve the score. No person or
company can control or change the score.
Who is a typical candidate for credit restoration and how do
credit restoration companies find them?
Typically, a candidate for credit restoration has a credit score
below 640 and has negative information on their credit reports.
Many of them may be in the process of making a major purchase such
as a home or a car. Some of them may be looking to refinance or
take out a loan for home improvements. A good candidate is also
willing to work toward the goal of improving their credit. There is
one target market for credit restoration companies to focus on.
Some companies may advertise directly to the consumer through the
Internet, newspaper or direct advertising. Others may market to
industries that utilize credit scores, like loan officers, mortgage
brokers, real estate agents or car salespeople. A client that is
referred is usually a better route than a client from direct
advertising.
How does this benefit the loan officer?
How can this process benefit you as a loan officer? Instead of
tossing these files to the side, make them potential clients by
referring them to a reputable credit restoration company. Make sure
to follow up with themthis will ensure that they will come to you
when they are ready for financing. There is no guarantee that you
will close a loan with any person, though with minimal effort, you
can refer several potential clients to a reputable credit
restoration company. The more you refer, the better your chances of
gaining new clients. Just do the math! For example, lets say you
average a commission of $1,000 per loan. If you refer 10 people per
month to a credit restoration company and five of them close a loan
with you, it means five extra loans a month or $5,000. Its that
simple. (Some companies may offer referral fees but loan officers
are responsible for restrictions with their employer or state
licensing department.)
The success rate of credit restoration is exceptional; however,
when using a credit restoration company, cooperation from the
consumer is important. Increases in the score cannot be guaranteed
and credit improvement takes time. Credit restoration is a
beneficial option for loan officers when their client has a low
credit score. The consumer can do this process alone, although it
can be very confusing and time-consuming. Deciding to use a credit
restoration company is a great idea; however, as with any business,
it is important to choose a reputable company that provides
excellent service, honesty, loyalty, reliability and
trustworthiness.
Sherene Costanzo is vice president of Credit Consultants
Inc. She may be reached by phone at (888) 522-7007 or e-mail [email protected].
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