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Crunch the Numbers As we come to the end of the month, it helps to review the numbers and targeting the loans that need the most attention. We would like to say we treat every loan balance the same and we have all the man hours needed to collect every loan with intensity. However, in reality, we need to prioritize the loans that need the most attention and that could affect our DLQ%. This is not always the largest loan balances, but it usually turns out that way. There are times when a loan is up for charge-off that giving it a fresh look results in new information and a contact.

How do we Crunch the Numbers? I can share with you what I do and there are other collectors that have been in the business for years that would teach other ways. About the third week of the month, I review the loans that have not paid and could roll to the 60 day category. I review activity for the loans and what promises have been made. Next, I look at the largest balances and review down to the smallest balances. This gives me some idea of what loans will be moved off the list by month end. From there I gather a “hit” list of loans in decending loan balance order that helps me focus my attention in order to bring the best results by month end. What is the next step to help this member pay- Call, letter or even a personal visit? If no contact has been made, why? Do we need to skip trace the member to make contact?

Next, what loan volume needs to be moved off the list to bring the DLQ% under the previous month’s DLQ%? We used to call the “making the break” in finance company collections. Each month the goal was to lower the DLQ% below the previous month’s numbers. That was a starting place. How much loan volume decreases your DLQ% by 1.00%? or even 0.50%? If you don’t know, take a minute to figure it out. For example;
Outstanding Loans $10,000,000
Ten Percent $ 1,000,000
One Percent $ 100,000
One half a percent $ 50,000

Adjust the numbers accordingly. If you have $20M in loans, then follow the pattern. Then who on your list needs to pay in order to bring your numbers down to your goal – the fastest? In the above example, if I needed to bring the DLQ% down a half a percent, I look for loan balances that add up to $50,000. Then arrange my time to work on them first while not ignoring other members either.

Hopefully, this will give you some insight on how I arrange my time to bring the best results possible every month. If your work load has increased like mine, then you are looking for ways to work smart and not just hard.

Technorati Tags: Collection Techniques, Delinquency ratios, Time management

Results from Field Calls is what ultimately we are after. There is no need to spend the time or gas knocking on doors unless we get results. Results can be more information but ultimately we need resolution of the problem – money. Last Saturday, I spent a couple of hours knocking on doors and here is a brief narrative of what happened.

First, I went to visit member that I suspected did not work on Saturday. I knocked on the apartment door and no answer or sign of life. As I finished the note to leave in an envelope, up the stairwell comes a lady with two cute boys following in behind. “Mommy, open my gun!” Each had a play gun that they needed help getting out of the wrapper. She stared at me and I asked if she was ER. She said yes and I introduced myself. She seemed flustered and tried to talk above the noise but could not. Finally, when the boys were able to play with their toy even while it was in the wrapper, we could talk. She and her husband had split, her brother was living at the property we had financed. She did not have money today. She would get in touch with her brother and make the needed payment by the last Friday of the month. This was some progress. I accepted that and told her to contact our office by Wednesday. At this writing, she has not. But, I also obtained some good information on the ex-husband who is several months past due! It lead me to find an address for his mother – several miles away, that was a bonus!

Next, I visited a member in a mobile home. They had an amazing feature to the front door. When you knocked, the TV went off inside! After several knocks, I realized the TV would not come back on and I would not get a personal greeting- except from the hungry cat! So, I left a note and lingered a bit. Still there was no TV noise…. Hmmm, that was some smart door!

Results so far, not great. But, I was making a good statement about how serious each member’s loan was to the CU. Next, I went out of the town on a country road. I came upon the house for the member and suspected it was abandoned. The grass was very tall, in fact taller than the dog that made its way to the fence to bark at me! Before the dog could find his way out of the grass jungle, I had checked the electric meter in the back and it had a good tag on it, so the house was occupied. Another knock on the side door was answered by an older teenager. He was polite and took my note. His mother would not be back until after 8:00PM. I also asked him for a contact phone number, he gave me the mother’s cell number! That was a good improvement! Later that evening, she did call my cell and has already paid more than one payment and will pay again by month’s end. That helped a lot! Read the rest of this entry »

Technorati Tags: Field Calls, Personal Visits, Results

Bankruptcy Rule 9037 became effective December 1, 2007. The purpose was to protect private information from being made available on any electronic source, for obvious reasons. In NC, we file claims electronically. So, in order to comply, one must follow the Federal and State statute. A bacis web search for RULE 9037 will bring several sources to explain. See this:
http://www.almb.uscourts.gov/Announcements/120107%20bk%20rule%20amendments.pdf

Recently, I allowed a few scanned documents to be filed with the court without proper redaction of the information. According to my attorney, FD a MAJOR sin. He advised there was nothing to do except count this as a future liability for the CU. Any financial loss of the member due to the information breach or even only perceived as the possible source of the personal information breach would be the ongoing responsibilty of the CU that filed the documents. The member’s attorney filed a motion to have the claim documents sealed against public access. My attorney also said that the CU could have been accessed the fees for the debtor’s attorney that filed the motion. The Judge’s decision did not require that. Yea.

RULE 9037 – short recap: SS numbers- only last four digits. Use only initials of minor children. Include only the birth year of member/debtors. Account numbers- count backwards four digits including the suffix, use only these four numbers.

This case was the same case posted earlier in regards to the 341 Meeting in Charlotte, NC August 21, 2008 that was a little stiff.

Technorati Tags: Bankruptcy RULE 9037, Filing Bankruptcy Claims, Redaction

New Account Verification, this has become a little more complicated with the present regulations and with regulations changing all the time. This week, a Credit Union showed me some papers mailed to the CU requesting a new account. The application was printed from their website. The President asked me to run some reports to confirm their thoughts. The papers were for a Phillip M. The social security number passed OFAC and so did the name. The address failed and so did the birth date.

Verification tools are offered on our website www.skip-trace-solutions.com. I used a simple “People Search” and verified the social belongs to a man in TN. “Drivers License Verifier” shows the name and address do not match. Finally a “Reverse Address” verification showed the address is a business address in Brooklyn, NY with three businesses and three different names and telephone numbers. Okay, this was too easy. The US Postal Money Order included in the envelope appears legitimate. The big give away, the applicant claimed to be related to the Operations Manager!

The verification process is so vital. Fraud through bogus accounts constantly plagues our industry. Examine your new account opening procedures. Make sure you have the tools you need. What could have happened here? He may have attempted a bogus check deposit at a shared branch and a quick withdrawal. Glad this CU will never know a loss on this bogus applicant.

Technorati Tags: fraud, new account verification, skip trace tools

As the months pass it becomes more than obvious, the average consumer is struggling. This has reflected in my workload as I feel certain it has in most every area of collections. So much so, that in recent months I have needed to make field calls as in years past. True, this is not the most efficient way to reach members. However, it can be effective. Though I have clearly made hundreds of visits to people’s homes, I take it serious every time. Anything can happen!            

You may not be able to make personal visits due to the location of your member, but if you do; I have listed below some guidelines and safety tips for this part of collections.

·    Plan your route with maps and account notes and copies of titles, if needed. Leave a list of stops with someone in the office. At a minimum, tell them where you are going and what time you should be back. Make sure they have your cell phone number.

· Take plain white envelopes to leave messages at the home. Also take plain white note paper. When leaving an envelope with a note, write the member’s name on it with the words “personal, private” in the bottom left corner. 

·   DO NOT LEAVE BUSINESS CARDS just stuck in a door. Especially, if your title is on it. Always put a note or card in an plain white non-see through, envelope. 

· Take a charged cell phone. I started when cell phones did not exist. I had to call in at pay phones! (they were a dime in most places..)

· Approach a home slowly and watchfully. Do not run toward a house, it may startle the people inside.

· Always Smile when talking to the person who answers the door. It puts them at ease.

· As with the phone, ask for the member by first name only-Hey, is Greg in?

· Listen and ask only pertinent questions. Do not appear nosey.

· Be respectful, say “Yes” and “Thank you” and “No, Ma’am”, and “Yes, Sir”!

· Do not mention that your member is past due on a loan when speaking to a third party. If asked, “Why are you here?”, you may say something like; “Well, Tom has personal business with our Credit Union and I need to speak to him.”

· Do not block people in when you park. This can appear aggressive. The exception would be if you are repossessing and the unit is there. I have parked behind the car that I want to secure. 

· If there is no one home, be cautious about going to the back of the home. Neighbors talk.

· If no one is home and there is doubt about the member still living there, consider going to a neighbor to verify residence. Do not say where you are from, just say something like, “Hey, I rang the door bell and no one answered, do you know if Billy is home?” Then just listen. Most neighbors love to talk.

· As with any visit to a member’s home, if you feel unsafe leave.

· Do not stare into windows, this can be seen as invasive. And- that’s right- neighbors talk. Especially about unknown visitors.

· Have some identification that you work for the CU in case you are stopped by authorities.

Technorati Tags: Field Calls, procedures, safety

Welcome! As the work load increases and the economy shows no signs of improvement, I find myself required to take up the practice of making personal visits or “field calls”, as in years past. This sometimes will lead to repossessions. The following is an account of a repossession I was a part of in NC.                         

Wrecker for Your Needs

On Wednesday, I participated in a self-help repossession. It is legal in NC and used very frequently. This case was a bit unusual. The Manager of the CU was directly involved due to the ongoing relationship with the parents of the member. This member/debtor was past due on a 2006 Nissan Altima. There were several phone calls to the member, several trips to the home where the member lived with her parents, to obtain payment or a valid promise to pay. Finally, after realizing the member was not able or willing to pay full monthly payments and that the parents were not a resource for this member, the decision was made to repossess the unit. The loan was four months past due, the broken promises were adding up. Also, the sources of any help were already exhausted for the member.

We arrived at the home and knocked on the door several times. The parents were working, the member we suspected was asleep. We called her cell phone to attempt to wake her. Nothing we did could wake her. We called a wrecker and he loaded the unit with no word from the member inside.

When we arrived at the CU, we called the county sheriff to report the repossession. We called the mother to let her know and to ask for a key. We then inventoried the unit and typed out the list. The inventory was signed by the two people that emptied the unit. The items were boxed and secured in the CU. The father brought us the key and he signed for the belongings. We notified him of certain valuables in the box and thanked him for the key. We moved the unit to be in view of the security cameras at all times.

Later that day, we received a call from the member asking what she could do to get the car back. She was shocked that we could come take the car with her things in it. She admitted she was asleep and did not hear us knocking. We told her she would have 10 days to secure a pay-off for the loan. In this case, we would not accept just the past due amount.  If she paid the loan in full, we would then return the unit to her. She was again not aware that we could request a full pay-off of the loan.   

Key things to remember when performing self-help repossession:

• Plan your visits during the “safest” hours of the day.
• When possible, send two employees to pick-up the unit.
• If the unit was financed new, see of you can obtain a key that is cut from the key code. Calling the dealer and faxing a copy of the title can usually prove your lien and get the code or the key cut.
• If you must send only one person, make sure the person leaves a list and copies of map(s) to show their expected route and time of return.
• Also, take a fully charged cell phone.
• Find the telephone numbers for wreckers ahead of time and call them to see who would be available when you need them, put them on standby.
• Take gloves, pen, paper and trash bags. You may have to inventory the unit before you come back to the office.
• Take a screwdriver with both kinds of heads for taking off the license plate.
• Take a camera with batteries and film, (if film is needed).
• FInd the non-emergency number for the local authority and put it in your cell phone.
• Be prepared to pick-up the unit and be prepared to leave it. If the situation gets dangerous- leave and consider sending someone else after dark. If you “breach the peace”, you must leave.
• If the member is home, but asks you to leave- then leave, quietly. No questions asked.
• If the member is not home and a relative or neighbor asks you to leave- then leave. Do not risk confrontation especially on private property.
• Do not look in windows or doors for more than a mere glance. Anything more can be construed wrongly and could result in trouble.
• Stay away from dogs unless the owner is present. Do not reach down to pet a strange dog. I have heard of repo men taking dog biscuits to help in tight spots!
• Do not take a gun for any reason. Should not have to mention this, but a wrecker driver for me showed up with a gun one day and asked me to hold it. He said shoot anyone who comes out the door. I told him I would not and handed the gun back to him!!!
• Remember, no car is worth you safety or your life! If you feel danger- leave.

Technorati Tags: repossession, safety, self-help