The Evolution of the Credit Repair Business

Maximizing Collections in Credit Repair: The Revolutionary SPA Model

It is illegal to accept payment in advance for services before they are fully performed as per the contract. However, legal counsel confirms that it is permissible to require customers to establish a Special Purpose Account (SPA) with a qualified company. For these accounts, we recommend using

What is Trans2pay and how does it work?

After performing the services, the customer sets up a new bank account to set aside funds to pay for services. Nothing more and nothing less.

The greatest advantage is that the accounts lack connections to debit cards and do not include checks. Importantly, consumers can access their funds in the SPA only after they provide a seven-day notice and after you receive notification of their request to close or withdraw money from the account. This approach offers a cooling-off period for the customer and allows you the opportunity to re-engage and potentially re-sell to the customer.

Effectiveness of SPA in Reducing Collection Problems

Whether you are on a monthly model or pay for delete, “requiring” your prospective customer establish this account as a non-negotiable will virtually eliminate the collection problems that exist in this industry. Research indicates that as much as 25% of all revenue remains uncollected. And this is after a considerable and consistent collection effort.

Impact on Credit Repair Companies

That one fact alone causes most credit repair companies to fail or substantially reduces the necessary cash flow and profits to be truly successful. According to debt settlement companies that have been using the SPA model since 2003, “up to 95% of consumers that make their first payment into the SPA complete the program.”

SPA as a Requirement for Success

Making the SPA a requirement in your enterprise is without a doubt a necessary move. Not only does it “virtually” eliminate the collection issues but it also serves as a great indicator of the consumer’s willingness to pay you after the service has been fully performed. We can all attest to the fact that individuals with bad credit “don’t mind owing you.” The best time to get money from a consumer with bad credit is before you do the work. But since this is impossible, the next best thing is to gauge their fortitude to keep their end of the bargain/contract by agreeing to set aside up to as much as 100% of the cost outlined in the contract.

Benefits in Different Business Models

In both Pay For Delete and Monthly Recurring Revenue Models, knowing that the consumer’s funds are secure before starting work and avoiding the need to pursue payment after delivering the service marks a revolutionary development in the credit repair industry. Yes, the consumer has an additional monthly fee of $10 per month but the savings for you far outweighs any objection to price. Let’s put it this way: if you will only collect 75% of the fees that you earn after considerable effort, in most cases, the credit repair company would be better paying the $10 per month fee simply to “virtually” eliminate cash management and collection issues.

 Pre-Authorization and Compliance

The best part about the SPA is that the consumer provides you with “pre-authorization” to submit a request for payment to Trans2pay after you have submitted an invoice for payment. Of course, the moment you take advantage of this program by collecting funds from the consumer’s account before satisfactory work has been done will be the day your privileges are revoked.

 Potential Customer Response

We presume that a number of customers will not choose to do business with you because of this requirement. They may be the same 25% of your customers that do not intend to pay you anyway. Perhaps the requirement of the SPA will eliminate all of these customers.


In summary, the Special Purpose Account (SPA) model represents a significant advancement in the credit repair industry, addressing long-standing collection challenges. By requiring customers to set aside funds in advance via a SPA, credit repair companies can ensure payment security and reduce the risks associated with uncollected revenue. This model not only streamlines cash flow but also serves as a litmus test for consumer commitment, thus leading to a more efficient and profitable business operation. While some customers may be deterred by this requirement, it ultimately filters out those less likely to fulfill their financial obligations, aligning your customer base with those who value and respect your services.

Editor’s Note: This is part two of the series Profile of the Credit Repair Customer.

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