A Single Collection?

[baybones]

I have a $71 Dollar collection for a past bill that I had disputed several times. I recently paid the collection in return for the company agreeing to "restore" my credit to showw no collection ever existed. My queston is does this collection put me in a high risk catagory automatically. I meet all of the other requirments to apply for a regular bond, however the application wizard send me to the high risk bond application. In addition, this is a new company so we do not have buisness financials, is that a disqualifyer as well?

Thanks for your help!

Sarah

[Admin]

Sarah,

An unpaid collection will generally put you in a high risk market. However, if you can show proof of payment (letter from company that placed collection or the collection agency) then you can state that it is paid.

Being a new company, most bonding companies will not offer you their lowest rate available (This does not mean you will not obtain a standard rate). Believe it or not, some bonding companies will not write new motor vehicle dealers regardless of credit score, personal financial statement, etc. However, we are appointed with numerous sureties that are willing to write new auto dealer companies.

There are literally hundreds of scenarios since there are many bonding companies with different underwriting practices. Your best bet is to apply at: Auto Dealer Bond. Be sure to answer that you have no unpaid collections since you already have it paid.

Let me know if you have any further questions, I am always happy to help.

[baybones]

Because I recenly paid the collection, I have a bank draft for the amount. Considering the low amount of the collection, do you think this would suffice as evidence. Companies can be difficult to work with on getting documentation. Also how would I get thie evidence to the underwriter before they actually look the file.

Thanks,

Sarah

[Admin]

Originally Posted by baybones

Because I recenly paid the collection, I have a bank draft for the amount. Considering the low amount of the collection, do you think this would suffice as evidence. Companies can be difficult to work with on getting documentation.

It depends on the bonding company and the underwriter. You could try to use that at first and the underwriter will let us know if additional documentation is needed.

Originally Posted by baybones

Also how would I get thie evidence to the underwriter before they actually look the file.

Our agents always know to review a file to what can be done to obtain the lowest rate prior to submitting. Something like an unpaid collection will be an immediate red flag to the agent and they will recommend you show documentation that it is paid, as the money saved on premium would be a good amount more than having to pay the collection.