Recovery doesn't come easy
Nov 06, 2013 Simon Williams
No matter profession or financial situation, at some point, the majority of us have gotten into dire straits where finances are concerned. Whether that means not having enough in your bank account to justify a recent purchase - and therefore overdrafting - or forgetting all about a medical bill until the final notice is mailed, much of the time, it's a one-time issue.
However, a number of consumers have, at one time or another, dug themselves into debt and will do just about anything to get out. This is especially true in the United Kingdom, where people's finances were thrown for a loop during the global recession and the subsequent - and still ongoing - recovery.
This is where short term lenders can step in. It's important for such companies to be a great resource and first stop for financial information - this can boost customer satisfaction and drive revenue in the end.
One of the first things lenders can tell clients who have done damage is that they still have options if an emergency happens and they need access to alternative credit. By relying on less traditional credit scores, like the Payment Reporting Builds Credit model, these companies can take more liberties during the approval process. Borrowers can temporarily use the loans, and lenders can mitigate risk and make sure they'll be paid back.
After deploying this method of reassuring customers that they can still open lines of credit at competitive rates, lenders might want to make it clear that credit score rejuvenation can't happen overnight, despite the presence of services that claim to restore rankings immediately after paying. These statements tend to come from fraudsters.
This Is Money suggested that consumers need to be told to first verify that all information on their credit histories is both up to date and correct, and start applying for credit again when possible - but only if they can pay it back on time. This can rebuild scores, but individuals need to know that full recovery will take years.