What exactly is a bankruptcy search, and how does it affect you and your business? Very simply, this is very important when giving out money to a customer, in the case of a loan, mortgage, or lease, or providing monthly services, because if the customer has experienced bankruptcy in the past, it's obviously very dangerous to give them money, as you will very likely never see the money again, based on their past behavior.
This is why doing a bankruptcy search is so important.
First of all, anytime a new customer wants to do business with you, and finance their purchase rather than pay it all at once, you will obviously want to do a search of their credit report to make sure they haven't filed for bankruptcy in the past.
If they have, then you probably shouldn't do business with them unless your particular business focuses more on high risk customers for whatever reason.
Also, if you find one of your customers not making payments on time, or only paying part of what they should, then you need to think about doing a bankruptcy search as well.
This way, you can immediately find out and therefore stop sending them the products and service they ordered until they do pay, if at all.
Typically, conducting a bankruptcy search is not expensive at all, and in many cases, free.
In fact, usually it will be sufficient to check the local or state records around where the customer lives, and see if there name is listed under bankruptcy filings.
If so, then you obviously need to cut ties with them.
Again, this process shouldn't take more than a few minutes per customer if that long, but will save you a lot of time and hassle down the road.
Remember, the customers that cause the most problems usually spend the least, so it's highly recommended you cut ties with them immediately and focus only on the customers that are making you money.
your business depends on it.