Credit Policy for businesses and how to extend credit and manage credit risk

This advice may be good for the dealer but how do you collect when it has been 2 years and made it to 2 or three collections agency. Then what? When a person can allow their car to be repossessed then go to a buy here pay here they are not open to pay, and not afraid of being pursued legally. They may regret it in the long run but how many are legally sued? Most duck and dodge even the co-signers, they just don't care.

Carolyn,
Exactly why I write this blog, to educate dealers and business owners who extend credit to be careful about who they extend credit to. Check everyone's credit, and be VERY careful especially now with the economy slipping. If you have a debt that is 2 years old and has been through 3 collection agencies, it is time to write it off to bad debt and find out how that customer obtained credit through your company so you can change those procedures and not let this happen to you again.
When you are dealing with co-signers, their credit is checked at the same time you a check the borrower, and they must have had some type of assets or good credit for this loan to go through. Pursue them legally and/or attach any assets such as bank accounts, property or wages once you have a judgment. You can also report the debt to the credit bureaus.
The best way to deal with this type of situation is to have a credit policy, follow all procedures and be wary of lending money to someone who is not worthy.