All About Credit Review
Credit review is the process of periodically assessing the credit profile of an individual. Settlement companies, creditors and counselors carry out this activity. There are various reasons as to why credit review is carried out.
To ensure that borrowers are meeting the standards of the credit products, creditors carry out credit review on their borrowers. Depending on the payment history of the borrower, lenders will provide a credit limit. Credit counselors conduct credit reviews for the purpose of advising their clients on settlement of credit, latest credit products and consolidation of credit. It is for the purpose of identifying possible settlement for debts that settlement companies carry out credit review.
There are various benefits of credit reviews. One of the merits of credit review is that it will assist in the monitoring of credit review. Through a credit review one is able to establish whether their credit limit is likely to increase or not. Lenders are the one who mostly determine the credit limit of a person. In the event one is in need of capital for business expansion, an increase in credit limit will guarantee this. The other benefit of a credit review is that it will enable one to establish sources of errors and even correct them.
There may be calculation errors or errors in terms of amount of loan to be paid back to a creditor and therefore the conducting of a credit review will help avoid this. Calculation errors can be identified and amended early enough thus saving the business money. The other benefit is that credit review will help protect one against fraud cases. It is only with the help of a credit review that one can establish whether there are unauthorized transactions taking place or whether there exist fake accounts created under their names. This is of great benefit since incase an account has been created under your name and has not been identified, you are going to be liable for all the debts to be paid.
Since creditors can also make errors, a credit review will help you identify these errors. It is only through a credit review that one can identify errors in data sent by creditors to their bureaus and therefore this make the whole process indispensable. A credit review will also help you identify possible areas for debt settlement especially when one is bankrupt. A credit attorney can help one file for bankruptcy only after they have conducted credit review. In case of bankruptcy one can be released some or the whole debts if they present their case to court with the help of a credit attorney who has reviewed their credit.
It is advisable to make sure a credit review is done for you or your business since it very essential. It is advisable to have a credit review conducted every year so as to identify future threat and errors and to correct them.