Social media and internet reviews can prove a challenge for collection agencies.
By nature, these businesses are not going to provide the level of satisfaction from a consumer a restaurant or a shop might.

“You’re generally not going to be getting a very positive review,” says Reynaud. Because most comments are reviews are likely to be negative, it is sometimes best to respond sparingly or not at all to this type of consumer feedback.

If you can determine which account the commenter is speaking about, however, you should ensure all proper steps have been taken within your agency to avoid legal backlash.

Create a generic statement providing agency contact information may be a good way to show you still care about how consumers are treated by your debt collectors. Aside from this, little action is needed from your office.

The agent or manager chosen to handle disputed debts in collections at your office depends on a few factors.

Disputes are sometimes broken up between those raised during the validation period vs. those raised after the validation period, and disputes that are verbal vs. written.

Decide which individual or department it makes sense to pass these issues to, and make sure all parties are aware of the policies you have in place.

At Pacific Credit Services, Parsons-O’Brien says all of types of issues raised by a consumer “will be handled exactly the same way and be isolated to the dispute department.”

Her agency employs a lead debt collector trained in defusing disputes who receives extensive training in this area. The debt collector is educated on which agency clients may be willing to settle, which are not, and the types of documentation each obtains and can provide in the event of a dispute.

This is an effective approach for cautious agencies that wish to avoid missteps during collection that could lead to an FDCPA lawsuit.

A good starting point during a disputed debt in collections is to verify whether the consumer received their validation notice.

If mailing the validation notice, it’s common that the address an agency has on file for a consumer may no longer be current. This can explain confusion a debtor may have about their bill, or why a dispute is raised after the 30-day validation period.

If emailing model validation notices (based on CFPB’s Regulation F guidelines), your software should be able to provide tracking information that verifies whether the information was delivered, opened, and completed.

Be aware that many who dispute a debt may not have received a validation. If they claim this is the case, give the consumer the benefit of the doubt. Good faith can help ease a consumer’s mind and make them more willing to resolve the issue amicably.

Because each dispute situation is different, it may be time-consuming to respond when an objection is made. The panel suggested a possible way for collections agencies to respond quicker to collection disputes through letter templates while still maintaining dispute compliance.

Your agency’s attorney might be able to help you to draft several sample letter sections, phrases or bullet points that you are likely to use while addressing a submitted dispute.

Once these have been created, drafting a response might become easier, as you can piece together future letters from the pre-created draft statements and supplement them with information specific to each case.

Another step to take after a debt is disputed is getting proper verification of the debt from your creditor client. The extra knowledge this documentation provides can arm an agent during ‘second talk-offs’ with a consumer, and help to identify whether they are stalling, objecting to the debt, or legitimately raising a dispute (a classification that is difficult to discern during the original communication).

A debt collector who is well-trained in disputes can use this call to identify the motivations behind the consumer’s initial concerns, and show that the bill or debt owed is legitimate.

Being able to review a bill or the proof of debt together on the phone also provides the chance to clear up any confusion a consumer may have.

If they can see the documents for themselves, this helps them understand why they are being billed. Simply providing this proof often helps to resolve a debt.

“I find that with many people who truly are confused about the account, providing them proof of the debt will have them resolve it,” says Parsons-O’Brien.

The time and resources a second talk-off takes can be frustrating. But, doing the work early in a debt can raise your dispute resolution rate, and save your business from the massive expenses associated with defending a lawsuit.

There is not one clear policy or procedure agencies should put in place to handle collection disputes. What you decide for your company depends on what will fit best with current processes and keep lawsuits to a minimum.

When reviewing your company’s policies and procedures surrounding disputes, there are several items to consider:

What is the policy and procedure you have in place?

Are you experiencing problems with handling disputes as a result of the rules you have set?

Parsons-O’Brien and Reynaud advise that identifying holes in your system is easiest as individual situations arise. After you have resolved a problem, review what could have been done differently through root cause analysis.

Writing policies and procedures as you go along allows you to fix, update and maintain your compliance management system piece by piece, cutting down on wasted time guessing on best practices. This approach will also save you from becoming overwhelmed with the magnitude of such a project.

Choosing the person in charge of disputes at your office is a matter of deciding what is best for your agency. As mentioned, many collection agencies treat all complaints as possible disputes, passing all contact with consumers to a single department.

If your agency is comfortable keeping some disputes in the hands of agents, be sure they are properly trained. Understanding your obligations in handling disputes is essential. Ensure all policies and procedures fulfill these obligations.

Attorney letters or cease and desist letters are often referred to as fire, or hot mail. These are addressed differently than any other dispute issue at an agency, as they have the potential to cause legal ramifications if mishandled.

These letters should go straight to agency management, to be dealt with in the appropriate manner.

Speaking to the original creditor as disputes arise is often helpful. Some clients have detailed proofs of the debt which can help you in settling a dispute and collecting on an account.

Some clients, however, have mishandled accounts or not kept as much detailed information on the debt as you might like. Informing them of a dispute as it is happening is a teachable moment.

If you share what you are going through and tell them how it can be avoided, collecting on future accounts will become easier.

Handling disputes of a debt is a difficult part of running a collection agency. Knowing these best practices can arm you against lawsuits, and prepare you for when inevitable complaints arise.

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