Credit Damage Blog

Credit damages can be a tremendously significant part of the damages, as much as $100,000 or more, in a law suit. Georg Finder writes, "It is my policy to decline cases where my service will not impact the valuation by at least $30,000. Typically my contribution improves a case by over $75,000."

Credit damages may result if a victim suffers any of the following: cancellation of credit, increased borrowing costs, loss of credit capacity, or loss of expectancy. Those adverse events will occur when a person is unable to meet credit obligations and creditors provide negative reports to credit agencies. Prospective creditors will utilize those negative remarks in deciding whether to grant credit at or, if they will grant credit, in what amount and at what interest rate.

A credit score is intended to rate the probability that a borrower will default on a loan. It is based on several factors including payment history, outstanding debt, length of time one has had credit, the number of inquiries on your report, and on the types of credit you currently have. The first two factors are by far the most heavily weighted in calculating a credit score. In Sandy’s case we can infer that, as Sandy becomes unable to meet credit obligations, the payment history will deteriorate and the outstanding debt will increase causing a decreasing credit score.

Over time Sandy’s credit report will contain more negative reports. Sandy can therefore expect that it will be more difficult to obtain credit (loss of credit expectancy), that when credit is available, it will be for less (loss of credit capacity), and the interest rate (cost of credit) will increase. Sandy may also lose credit cards or otherwise existing credit (cancellation of credit).

It almost becomes a matter of common sense that if one’s credit is damaged as the result of the wrongful act of another there should be compensation. The remaining question becomes how much compensation is appropriate. The answer can be determined by someone qualified to analyze a credit report and the negative reports found therein and who understands the implications of a credit score. These are not mere numbers which can be plugged into a calculator to elicit a dollar amount of damages. To reach that figure requires an expert. One expert is Georg Finder, a recognized authority in the field.