Business Debt/debt

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Expert: - 2/3/2009


Question
I am worried about losing my job as most people these days.  If so, I will not be able to pay credit cards or personal loan.  I owe about $6000 each on 2 credit cards and a personal loan of $12000.  My question is can a bank automatically take money from my checking account when I am delinquent on a card or loan?  If so, can they do it even if I have checking account with a separate bank not linked to the debt?  Also, will I be able to hold a checking account with bad credit?  I will not overdraw money that some do and have reports in chexsystem, but I will not be able to make payments on credit cards or loan if I lose my job.

Answer
James,

The only way any creditor can attach your assets, such as bank accounts (any, wages, or put liens on your property is if they obtain a judgment.  If you are unable to pay or afraid you won't be able to pay your bills, call them now, do not wait until you cannot pay. Call them and tell them you will be losing your job and will be financial strapped and so you need to set up some type of payment arrangement with them to avoid going to collections.  If you wait and it goes to collections you will have to deal with the collection agency and it will be reported to your credit report and be much harder for you to deal with getting approved for payment plans or arrangements.
Most credit card companies will work with you, you may have to cancel the cards, which looks better on your credit report than them cancelling them on you, and you may be able to get some of the interest or fees written off, it depends on the individual card. Be sure to keep notes of when you call, who you talk to and the agreement, also ask them to send you whatever you decide upon in writing.

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Michelle Dunn

Expertise

As one of the Top 5 Women in Collections, one of the Top 50 Collection Professionals, and winner of the Business Excellence award, I can answer any questions about debt, debt collection, improving business credit, creating a credit policy, enforcing a credit policy and collecting on past due accounts. I can also answer questions in regards to starting a debt collection agency since I have been a bill collector for over 24 years, started and ran my own collection agency for 8 years, and maintain my 12 year old Credit & Collections Association for members of the credit & debt collection industry. I am also the author of the popular and award winning book "Starting a Collection Agency, how to make money collecting money" now on it's 3rd edition. This book has won a the Writers Digest self published award as well as the New York Book Festival Award. I am a repeat contributor to the Wall Street Journal, and have been featured on NPR, CNN, as well as many other national radio and television programs. I have also been featured in national publications such as the Wall Street Journal, Forbes, Smart Money, MSNBC and much more. I have 17 published books to my name and am an accomplished speaker and consultant. I currently write 9 columns for newspapers, magazines and online portals worldwide.

Experience

I have over 24 years experience in debt collection, I started and ran my own collection agency for 8 years and I am the founder & owner of my Credit & Collections Association that I founded in 1998. www.credit-and-collections.com

Organizations
My Credit & Collections Association, I was also a member of the American Collectors Association and Plymouth Chamber of Commerce for 11 years. I am a member of many writing groups as well as my local Women Inspiring Women chapter. I am a member of Know More Media as an expert for their blog on business credit.

Publications
Business NH Magazine, Smart Money Magazine, MSNBC, CNN, Forbes.com, The Wall Street Journal, Home Business Magazine, Entrepreneur Magazine and website, many books, newspapers and television programs as well.

Education/Credentials
I have written 17 books in my collecting money series and one for Entrepreneur Press called the Ultimate Credit and Collections Handbook. My newest book is being published by John Wiley & Sons in May titled, The Guide to Getting Paid, how to weed out bad paying customers, collect on past due balances and avoid bad debt. This book is also being sold to many colleges as a text book.

Awards and Honors
My book Starting a Collection Agency, how to make money collecting money won an award from Writers Digest and the 2007 New York Book Festival in the "How to" category. I have won 2 awards from Dun & Bradstreet and Governor Jean Shaheen. I was nominated as one of the Top 5 Women in Collections twice as well as having been selected as one of Collection Advisor's Top 50 Collection Professionals by my peers.

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