collections overview

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  • 1. Debt CollectionAn Overview
    Presented By: Satyakam Biswas

2. Agenda
Debt Collection Definition
Types of Collections
A Flowchart
Debt Collection Legal Aspects
Top 10 Collection agencies in US
Credit Bureaus and Credit Reporting
Sources of Money (SOM)
Payment Options
Strategies used for liquidation
Collection Call Flow
Collection Pyramid
3. What is Debt Collection?
Debt collection is a simple mean that pursues payments on debts owed by individuals or businessesDebtcollection can be done in various ways:1. Legal notification 2. Lettering 3. Via Phone Calls4. Legal proceedingsDebt collection can be either done by original creditor by their in house collections department or by any third party collection agency appointed by original creditor
4. Types of Collections
5. First / Third Party Collections
Consumer Collections
Commercial Collections
PLCCs
Telecom
Medical Bills
Auto/Home Loans
IT & Automation
Waste Management
Financial Services
Login Hour based billing model
Contingency / Commission based billing model
Pre charge off accounts primarily 0-180 days
Post Charge off accounts
Small ticket size/ Dialer Environment
Big ticket size/ Dialer + Manual
6. Debt Collection Laws
There is a federal law that dictates how debt collectors mayand may notdeal with consumers. Its called the Fair Debt Collection Practices Act (FDCPA), and it applies to personal debts, including money owed for an auto loan or home loan, for medical care and for credit card accounts
According to the Federal Trade Commission (FTC), under the FDCPA, a debt collector:
1.May not call you before 8 a.m. or after 9 p.m.;
2.May not call you at work, if the debt collector knows that your employer does not approve of such phone calls;
3.May not harass, oppress or abuse you;
4.May not lie, and may not falsely imply that you have committed a crime;
5.May not use unfair practices to try to collect a debt;
6.Must identify himself or herself to you on the phone; and
7.Must honor a written request from you to stop further contact.
7. Top 10 collection Agencies in US
8. Credit bureaus in the U.S.
There are three major credit bureaus in the US and then there are other sub bureaus which fall under these three.
Trans-union
Equifax
Experian
9. Why is Credit Reporting Important?

  • Credit reporting helps in repairing consumers credit score

10. Helps build consumers credit worthiness 11. Every time an account is paid off, has to be reported to the Credit Bureau 12. In third party collections credit reporting Is usually done by third party collection agency 13. In the case of First Party Collections reporting is done by the original creditor 14. Post paying off the account, even the consumer can contact any of the credit bureau and get the status updated with the help of the final notification from the collection agency. This is more relevant to third party collections scenario, usually when a consumer settles or pays off his/her old outstanding debt

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