Negotiating Skills Workshop "Persuasive Communication"

National Association of Collection Agents (NACA) (800) 977-1197 www.CollectionAgent.org

FDCPA Rules and Regulation Compliance

FDCPA Fair Debt Collections Practices Act Enacted by Congress 1966 Enforced by FTC (Federal Trade Commission) To protect consumers from abusive, deceptive and unfair debt collection practices Each state may have their own impeding legislation that may vary the scope of the main stream logistics of the federal format of the FDCPA In that case, the state statute will take precedence over the federal context

FDCPA Rules and Regulation Compliance

Most of the Law in reference to the individual debt collector falls under compliance in regards to communication which includes: Who you can speak with Information you can/cannot disclose Proper representation Proper/Legal time-zone contact Parameters of accepted legal representation Cease & Desist orders and Limitations

FDCPA Rules and Regulation Compliance

Most Common FDCPA Violations: 1. Ask you to pay more than you owe The collector cannot misrepresent the amount you owe. [15 USC 1692e] 807(2)(a) 2. Ask you to pay interest, fees, or expenses that are not allowed by law The collector can't add on any extra fees that your original credit or loan agreement doesn't allow. [15 USC 1692f] 808(1) 3. Call repeatedly or continuously The FDCPA considers repeat calls as harassment. [15 USC 1692d] 806(5)

FDCPA Rules and Regulation Compliance

Most Common FDCPA Violations: 4. Use obscene, profane, or abusive language Using this kind of language is considered harassment. [15 USC 1692d] 806(2) 5. Call before 8:00 am or after 9:00 pm Calls during these times are considered harassment. [15 USC 1692c] 805(a)(1) 6. Call at times the collector knew or should know are inconvenient Calls at these times are considered harassment. [15 USC 1692c] 805(a)(1)

FDCPA Rules and Regulation Compliance

Most Common FDCPA Violations: 7. Use or threaten to use violence if you don't pay the debt Collectors can't threaten violence against you. [15 USC 1692d] 806(1) 8. Threaten action they cannot or will not take Collectors can't threaten to sue or file charges against you, garnish wages, take property, cause job loss, or ruin your credit when the collector cannot or does not intend to take the action. [15 USC 1692e] 807(5)

FDCPA Rules and Regulation Compliance

Most Common FDCPA Violations: 9. Illegally inform a third party about your alleged debt Unless you have expressly given permission, collectors are not allowed to inform anyone about your debt except: a. your attorney b. the creditor c. the creditor's attorney d. a credit reporting agency e. your spouse f. your parent (if you are a minor)[15 USC 1692c] 805(b)

FDCPA Rules and Regulation Compliance

Most Common FDCPA Violations: 10. Repeatedly call a third party to get your location information The collector can only contact a third party once unless it has reason to believe the information previously provided is false. [15 USC 1692b] 804(1) 11. Contact you at work knowing your employer doesn't approve A collector is not allowed to contact you at work if youve let them know your employer doesnt approve of these calls. [15 USC 1692c] 805(a)(3)

FDCPA Rules and Regulation Compliance

Most Common FDCPA Violations:

12. Fail to send a written debt validation notice Within five days of the collector's initial communication, it must send you a notice include the amount of the debt, name of the creditor, and notice of your right to dispute the debt within 30 days. [15 USC 1692g] 809(a) 13. Ignore your written request to verify the debt and continue to collect A collector can't continue to collect on a debt after you've made a written request to verify the debt as long as the request was made within 30 days of the collector's written notice. [15 USC 1692g] 809(b)

FDCPA Rules and Regulation Compliance

Most Common FDCPA Violations:
14. Continue to collect on the debt before providing verification After receiving your written dispute, the collector must stop collecting on the debt until you have received verification. [15 USC 1692g] 809(b)

FDCPA Rules and Regulation Compliance

Most Common FDCPA Violations: 15. Continue collection attempts after receiving a cease communication notice If you make a written request for the collector to cease communication, it can only contact you one more time, via mail to let you know one of the following: a. further efforts to collect the debt are terminated b. certain actions may be taken by the collector c. the collector is definitely going to take certain actions. [15 USC 1692c] 805(c)

Pre-Call Planning
Note the state debtor is located in Notice most importantly in the area code field of the telephone number, not solely the address field. Gather all information about the debtor that can be inferred by the face of the account Proper pronunciation of the debtors name is important Understanding who the client is; if possible and what the debt is for The balance in full is always due!!! If there is any settlement parameters and guidelines and what the criteria would be

Pre-Call Planning
Know your cut-off line in reference to payment terms being extended Be prepared with your collection script Where should be my initial point of contact be in order to be most effective in reaching the debtor for resolution If not the first time calling, where was the last point of contact The last place of contact will most likely be the best place to initiate the next call Read the notes from the last call to have a clear understanding, as not to have to revisit the prior call

Pre-Call Planning
Does the notes from the history of the account preclude or disallow any communication to the numbers on file If so, what obtain what is the most beneficial or viable option in that case Notice the ethnicity of the debtors name; as to ascertain if possibly a translator maybe necessary Once again the notation on the account will disclose this information if this is not the first attempt

Third-Party Disclosure
Who is ultimately responsible for the debt Who can I talk with regarding the debt You cannot disclose information about the debtor to anyone besides the debtor directly unless given express authorization by the debtor themselves. Except in the case of: Existing Power of Attorney Legal Counsel/ Attorney has been retained CCCS Agency or other representative agency has been authorized to handle the debtor affairs in reference to their debt

Third-Party Disclosure
Once legal representation has been established you cannot contact the debtor directly under any circumstances both verbally or written. Usually contact with the debtors spouse is valid except in non-spousal states. Non-Spousal states are: a. Iowa b. South Carolina c. Connecticut Disclosing any information to a spouse is a direct violation even if the spouse says they are responsible.

Third-Party Disclosure
In a Non-Spousal state you need both verbal and written authorization from the debtor in order to disclose any information to the spouse.

Leaving a Proper Message

There are five (5) types of messages that can be left Person to Person Voice mail or Answering Machine/Service Facsimile Email Text Message

1. 2. 3. 4. 5.

Leaving a Proper Message

Person to Person Clearly identify yourself Be authoritative Stress urgency of call back Always ask for alternate contact numbers/information Verify all information Ask relationship to debtor Always get a read back of the message left Give all pertinent information Company name, case number, reference number etc. Inquire the best time to reach the debtor

Leaving a Proper Message

Voice Mail or Answer Machine/Service Speak Clearly Watch speed of message Be careful not to disclose it is concerning a debt Stress urgency Always note if voice mail identifies itself with any identifiable markers (i.e. male voice, ids residence, Spanish speaking etc.) Identifiable markers will let you know or confirm of the message has been received

Leaving a Proper Message

Facsimile Call to verify fax number especially if a business debt Always use the collection letter with a cover sheet Cover sheet should have full disclaimer and disclosure statement to avoid breaking third party disclosure laws Stress urgency and confirmation of its receipt Always make sure it is marked attention to the intended recipient

Leaving a Proper Message

(Facsimile Continued) Helps to get to the debt and avoid stall tactics the debtor may try to impose Never disclose debt in subject line; however, do stress urgency

Leaving a Proper Message

Email Modern society and technology with social networks and the world wide web and internet makes email one of the best sources of communication with debtors Ensure your email has a disclaimer statement in case it goes to the wrong party to avoid third party disclosure laws Include Mini-Miranda on correspondence Always request return receipt and read verification

Leaving a Proper Message

Text Messaging
With the increased popularity in cell phone usage and the decline in land line telephones text messaging becomes a viable source of communication where permissible Get debtors permission to do so Most state laws prohibit it without proper consent Check state laws regulated by the TCPA (Telephone Consumer Protection Act) (Ericgoldman.org; Technology & Marketing Law Blog 2/12/11

Ways to Effectively Use Your Voice

Be Authoritative Never ask open ended questions to the debtor Use professional words and terminologies Never use slang Control the conversation by stating the purpose of the call Use consistent tone of voice with confidence Never yell or scream. It shows lack of control and discipline Use a pattern of repeats Always stress urgency of today

Temperament and

Controlling The Conversation

Never take the conversation personal Convey to the debtor this is business and not personal; as to control the debtors tone of speech In cases of dispute or errancy by the debtor against the client, always stress you are not the client, but want to bring a resolution to the matter TODAY! If possible use the date of debt to your advantage Reserve chain of command for escalation of temperament Dont allow debtor to raise disputes that are unfounded as a stall tactic

Ways to Effectively Use Your Voice

Be consistent with rebuttals Have confidence in client information to reaffirm the debt as paramount Dont allow personal issues to infringe upon the job at hand Dont take one call into another Each call is unique unto itself Dont be afraid to have the debtor call you back with a resolution (24 hours)

Listening Effectively for Redirection to Leverage the Debt

Never assume the debtors issues as your own Always represent the client Seize the opportunity to support the debt being owed Identify key phrases that admits responsibility Listen for alternate payment options a. Spouse b. Relatives; especially live-ins c. Borrowing or loans d. credit cards with balance transfers e. Second job

Listening Effectively for Redirection to Leverage the Debt

Listen for inclusionary opportunities for payment terms to implement a. Hardship b. Settlements Listen to the debtor explain their story; Most want to vent You are probably the first live voice they have had in reference to the issue in a long time Afterward, convey the ability for resolution based on information gathered Use aggressive persuasion tactics

Asking Questions with Precision

Never ask open ended questions Always ask questions that point toward payment and resolution Always have a follow-up question in relation to the outstanding balance Always redirect questions to the debtor You are not the one who owes the bill Ask questions that assist in the verification of information: 1. Home address 2. Home phone number

Asking Questions with Precision

3. Place of employment 4. Place of employment address 5. Place of employment telephone number with extension 6. Valid e-mail address 7. Alternate contact numbers (Cell) 8. Spouse contact information (if applicable) Ask the pertinent questions that lead to a definitive resolution: 1. When can you pay? 2. How much can you pay?

Asking Questions with Precision

3. How do you pay your bills? (check, credit card, on line, western union etc.) 4. When do you get paid? This will avoid circling between you and the debtor

Problem Resolution and Effective Alternatives

Listen effectively and affirm debtors concerns Identify the debtors dispute parameters When disputes are risen; resolve undisputed portion immediately and request debtor to provide written documentation Present alternatives that point to obtaining payment If BIF is not attainable ; be creative to execute terms within reason Establish reasonable parameters in an effort to satisfy debt in accordance with any issues debtor may have risen

Problem Resolution and Effective Alternatives

Know the parameters within the client will accept terms and have the ability to structure terms within them in an affirmation pattern Use a Help Me; Help You approach

Structuring A Collection Letter

Know FDCPA Laws in the State the debtor is in concerning contact If using a letter series make sure there is an escalation in tone and urgency Validation notice must be sent first; gives the debtor 30 days to dispute the validity of the debt and also advises the debtor of your representation if the client Make sure all personal contact for the debtor is correct Name Address Zip Code

Structuring A Collection Letter

Make sure to clearly state your intention in reference to representing the client in the body of the letter Make sure to demand payment in full in the body of the letter, within a definitively stated time frame Be clear to state who the original debt was owed to, if you do not represent the original owner of the debt Be sure to include the Mini-Miranda is on the bottom of the letter This is an attempt to collect a debt any information obtained will solely used for that purpose Make sure the letter includes proper contact information for the debtor to contact you in reference to the debt

Structuring A Collection Letter

Letters represent proper legal documentation to legitimize any settlement or payment arrangements that are made The letter must precisely state the arrangement as prescribed