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A debtor's account is labeled a skip account when the borrower purposefully tries to avoid paying his creditors. Typically, a person does this by moving after he has borrowed money but failing to give the lender his new address. Creditors often hire skips tracers to locate borrowers and assist with getting them to pay the money they owe.
When a person signs for a loan or credit card account, he usually agrees to keep his lender abreast of his current residence. This can mean notifying the creditor of changes in his address and possibly registering a forwarding address with the post office. Most people do this, but a debtor sometimes ends up with this type of account designation because of mere forgetfulness on his part. This can occur because a person is busy with many different tasks and overlooks sharing his new address with a creditor.
An individual can also end up with a skip account designation because of a typographical error. For example, something as simple as a misspelled street name or misplaced digit in a house number can cause this problem. As with a skip account that occurs because of forgetfulness, the debtor may eventually realize he isn't receiving bills and have the issue corrected.
There are also some reasons a person might intentionally fail to provide a creditor with his new address. Often, a debtor suffers a financial change that makes paying his bills difficult. He may then attempt to hide from his creditors until he can find a way to pay them or decide on a solution, such as bankruptcy or debt consolidation. On the other hand, some people do take on loans they never intend to repay and plan to hide from creditors indefinitely.
Skip tracers help creditors locate debtors who have moved without providing forwarding addresses. They may use a range of investigative techniques to find skip account debtors, including phone directory searches, online database checks, and reviews of old account records. A skip tracer may also try to contact debtors through their relatives and friends or by calling them at their places of employment. Once the skip tracer locates the debtor, he usually tries to collect on the past-due account and obtain current address information. When a skip tracer fails to locate a debtor, the creditor may consider the account a loss but retain the option to continue search and collection efforts.
If a skip tracer finds that the failure to provide a new address was unintentional, the skip account designation is usually removed from the account, and the lending relationship may continue as usual. In the event that the borrower is delinquent on his payments, the skip tracer may still attempt to collect money or negotiate a payment arrangement. Even in the case of a mistake, the ultimate goal is repayment.