The main goal of filing bankruptcy is either to give the individual or business relief from heavy debt or to create a fresh financial start. Once the claim is settled those who filed for bankruptcy are clear of debit, but also have limited credit choices. The majority of lenders want a debtor to re-establish a credit history before they will provide funds. Therefore, these debtors are in prime need of companies and/or merchants who offer alternative lending options. Bankruptcy leads afford these businesses the opportunity to target those debtors.
Bankruptcy leads contain the names of persons or businesses who have filed for bankruptcy. The claims are filed through the judicial system, federal, state and county courts, and public records. Companies who specialize in managing or establishing credit can pull data from these records as a marketing tool for their product or service.
Bankruptcy leads include name, address, and date of bankruptcy filing, plus more specific data regarding debt level, income, and status of the claim. Most of the alternative financing companies are seeking debtors whose claims have been discharged, or freed from legal liability. Other companies, however, such as credit reorganizers and debt consolidators can also find potential customers among those who recently filed, as well as those whose claims were dismissed.
Having a bankruptcy claim dismissed means the legal responsibility of paying the creditors still lies with the debtors. Creditor will still need to be paid, and expect the debtor to do so. These debtors are prime opportunities for debt consolidation companies. Other financial institutions and companies that deal with credit and credit history use this data to determine loan approval/disproval. Mortgage companies, automobile dealerships and credit card companies use these bankruptcy leads to calculate debt load and credit worthiness of applicants.
In the United States, there are six types of bankruptcy: Chapter 7, 9, 11, 12, 13 and 15. Chapter 7 and Chapter 13 are the most common for individuals. Chapter 11 is primarily filed by businesses. The chapter under which bankruptcy is filed determines what type of financial services the debtor requires, and which companies can use bankruptcy leads to approach them. In Chapter 7, assets are liquidated, the proceeds distributed to the creditors and the debt considered discharged. In Chapter 13, the debtor retains ownership and possession of assets, but must devote a portion of future income to repaying creditors, generally over a period of three to five years.
The information compiled for bankruptcy leads comes from the public records of bankruptcy claims. Gathering that information can be time-consuming, especially considering that, over a million bankruptcy claims were filed in 2006. Fortunately, several companies offer bankruptcy leads as a marketing tool. Information can be customized to the company’s particular needs: filing status (i.e. filed, dismissed, discharged, type of filing (Chapter 7, Chapter 13, etc.), etc. Available data covers filings from all over the United States and is updated on a regular basis. Other tools, too, such as direct mailing, and web-based services are offered as well.
What are Bankruptcy Leads and how will they help your business grow? Check out our site for valuable Bankruptcy Marketing ideas.
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