System and method for providing a credit account for debt recovery

• US 20050102228A1
• Filed: 11/12/2003
• Published: 05/12/2005
• Est. Priority Date: 11/12/2003
• Status: Active Grant

• Current Assignee: Jefferson Capital Systems LLC
• Original Assignee: Compucredit Intellectual Property Holdings Corporation II
• Inventors: Pendleton, Mark R., Stone, Brian F., Srinivasan, Krishnakumar
• Granted Patent: US 7,720,757 B2
• Time in Patent Office: Days
• US Class Current: 705/39
• CPC Class Codes: G06Q 20/10 specially adapted for electronic funds transfer [EFT] systems; specially adapted for home banking systems
• CPC Class Codes: G06Q 40/02 Banking, e.g. interest calculation or account maintenance credit or loans G06Q40/03
• CPC Class Codes: G06Q 40/03 Credit; Loans; Processing thereof

Abstract

The invention includes systems and methods for providing a credit account for debt recovery. A recovery credit account is provided for a customer with an existing charged-off debt. Some of the customer'"'"'s charged-off debt may be forgiven as part of a settlement when the customer enrolls in the recovery credit account, but the opening balance of the recovery credit account will represent the entire debt obligation of the customer going forward. The recovery credit account includes a credit limit that is lower than the opening balance. Reducing the account balance to less than the credit limit triggers open-to-buy status, issuance of a credit card, and activation of over the limit fees for future balances over the credit limit.

Claims

1. A method of recovering debt from a customer with a charged-off credit account balance, comprising:

creating a recovery credit account for the customer with the charged-off credit account balance; and

setting an opening balance of the recovery credit account to a value equal to at least a portion of the charged-off credit account balance and wherein the opening balance represents the entire debt obligation of the customer related to the charged-off credit balance.

2. The method of claim 1, further comprising setting a credit limit for the recovery credit account that is less than the opening balance of the recovery credit account and wherein the recovery credit account is not open-to-buy until the recovery credit account balance is less than the credit limit.

3. The method of claim 2, further comprising issuing a credit token corresponding to the recovery credit account only after the recovery credit account balance is less than the credit limit, the credit token enabling access to an available balance of the recovery credit account.

4. The method of claim 2, further comprising issuing a bill to the customer for the recovery credit account wherein the bill includes a payment amount that reduces the recovery account balance to less than the credit limit.

5. The method of claim 2, further comprising charging an over limit fee when the recovery account balance is over the credit limit only after the recovery credit account balance has been less than the credit limit.

6. The method of claim 1, further comprising issuing a bill to the customer for the recovery credit account wherein the bill includes a suggested payment.

7. The method of claim 1, further comprising establishing an automatic payment service for payments to the recovery credit account from the customer.

8. The method of claim 1, wherein the difference between the charged-off credit account balance and the opening balance of the recovery credit account is a settlement value negotiated with the customer.

9. A computer comprising a memory for storing program instructions and a processor, responsive to the programming instructions, configured to:

create a recovery credit account for a customer with a charged-off credit account balance; and

set an opening balance of the recovery credit account to a value equal to at least a portion of the charged-off credit account balance and wherein the opening balance represents the entire debt obligation of the customer related to the charged-off credit balance.

10. The computer of claim 9, further configured to set a credit limit for the recovery credit account that is less than the opening balance of the recovery credit account and wherein the recovery credit account is not open-to-buy until the recovery credit account balance is less than the credit limit.

11. The computer of claim 10, further configured to issue a credit token corresponding to the recovery credit account only after the recovery credit account balance is less than the credit limit, the credit token enabling access to an available balance of the recovery credit account.

12. The computer of claim 10, further configured to issue a bill to the customer for the recovery credit account wherein the bill includes a payment amount that reduces the recovery account balance to less than the credit limit.

13. The computer of claim 10, further configured to charge an over limit fee when the recovery account balance is over the credit limit only after the recovery credit account balance has been less than the credit limit.

14. The computer of claim 9, further configured to issue a bill to the customer for the recovery credit account wherein the bill includes a suggested payment

15. The computer of claim 9, further configured to establish an automatic payment service for payments to the recovery credit account from the customer.

16. The computer of claim 9, wherein the difference between the charged-off credit account balance and the opening balance of the recovery credit account is a settlement value negotiated with the customer.

17. A system comprising:

means for creating a recovery credit account for a customer with a charged-off credit account balance; and

means for setting an opening balance of the recovery credit account to a value equal to at least a portion of the charged-off credit account balance and wherein the opening balance represents the entire debt obligation of the customer related to the charged-off credit balance.

18. The system of claim 17, further comprising means for setting a credit limit for the recovery credit account that is less than the opening balance of the recovery credit account and wherein the recovery credit account is not open-to-buy until the recovery credit account balance is less than the credit limit.

19. The system of claim 18, further comprising means for issuing a credit token corresponding to the recovery credit account only after the recovery credit account balance is less than the credit limit, the credit token enabling access to an available balance of the recovery credit account.

20. The system of claim 18, further comprising means for issuing a bill to the customer for the recovery credit account wherein the bill includes a payment amount that reduces the recovery account balance to less than the credit limit.

21. The system of claim 18, further comprising means for charging an over limit fee when the recovery account balance is over the credit limit only after the recovery credit account balance has been less than the credit limit.

22. The system of claim 17, further comprising means for issuing a bill to the customer for the recovery credit account wherein the bill includes a suggested payment.

23. The system of claim 17, further comprising means for establishing an automatic payment service for payments to the recovery credit account from the customer.

24. The system of claim 17, wherein the difference between the charged-off credit account balance and the opening balance of the recovery credit account is a settlement value negotiated with the customer.

25. A method of collecting credit card debt, the method comprising:

creating a recovery credit account for a customer based on a charged-off credit account balance; and

prohibiting credit activity on the recovery credit account until the customer pays an open-to-buy amount.

26. A method of collecting credit card debt, the method comprising:

creating a recovery credit account for a customer based on a charged-off credit account balance; and

setting an open-to-buy amount for the recovery credit account.

27. The method of claim 26, further comprising issuing a credit token when the open-to-buy amount is paid by the customer.

28. A recovery credit account for a customer embodied in a computer system, the recovery credit account for the customer comprising:

a charged-off credit account balance for a customer; and

an open-to-buy amount that specifies a threshold amount of the charged-off credit account balance to be paid by the customer before credit activity will be enabled on the recovery credit account.

29. A computer for managing debt, the computer comprising:

logic configured to create a recovery credit account for a customer based on a charged-off credit account balance; and

logic configured to prohibit credit activity on the recovery credit account until the customer pays an open-to-buy amount.

30. A debt management system comprising:

means for creating a recovery credit account for a customer based on a charged-off credit account balance; and

means for setting an open-to-buy amount for the recovery credit account

31. The debt management system of claim 31, further comprising means for prohibiting credit activity on the recovery credit account until the customer pays the open-to-buy amount.