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Have you ever had a phone call with an unhappy debtor? Does it tend to happen more than you’d like?
PDCflow’s first CAC Collection Boot Camp recap covered best practices for leaving messages, as discussed in the webinar by Courtney Reynaud, June Coleman, Kelly Parsons-O’Brien, and Shawn Suhr. But collectors have to be careful of what they say (and how they say it) during live conversations with debtors too. This week, we’re providing an overview of telephone collection communication guidelines the boot camp panel discussed. We’ve included some best practices to avoid escalated calls and keep agencies compliant with regulations.
Call Model vs. Call Script
There is much regulation in the credit and collection industry about what you can and cannot say on a call. Because of this, collection agencies must strive to keep calls uniform, no matter what agent is collecting the debt.
There are two ways agencies can regulate calls: through a call script, or a call model. With a call script, the collector may not deviate from the words provided to them in the slightest. This is great for ensuring compliance, but sometimes debtors or the situation of the call can not be anticipated. If something arises that can’t be addressed by a script, a debtor may become confused or frustrated, which can lengthen the collection process.
On the other hand, a call model allows collectors to deviate. Rather than a word-for-word script, a model provides the framework of the conversation, providing key points that must be addressed. Letting collectors react to situations on the phone gives them room for a friendlier, more organic interaction with the debtor.
Whichever your collection agency chooses to follow, it is important to make sure there is some system in place which helps agents remember the legal statements they are required to make on their calls.
“On a Record Line” is My Middle Name
One of the most basic rules of telephone collection communications is to always tell the other party that you are speaking on a recorded phone line. To stress the importance of this phrase, Reynaud teaches all of her collectors at Creditors Bureau, USA that “on a recorded line is your middle name. Treat it like that and you’ll never forget to say it.”
Coleman, a longtime defense litigator to those in the industry, says damages for skipping this statement can add up quickly. The penalty for failing to mention ‘on a recorded (and/or monitored) line’ is $5,000 per missed opportunity per call. This means, if the phone is answered by someone other than the debtor, the phrase must be said to them as well. This would count as opportunity number one.
Once the correct party is on the line, it is the obligation of the collector to again say that they are speaking on a recorded line. This would count as opportunity number two. If the collector neglected both of these opportunities, the agency they work for could be fined $10,000. That’s a steep price to pay for one phone call!
Mind Your Manners
Owing a debt is never a positive situation. “One of the biggest struggles that collection representatives have is that they (the debtors) are never excited to hear from you,” says Reynaud. “Instantly, they’re on edge. They may be slightly defensive or upset because they’ve never heard from a collection agency before.”
Because of this, tone can be the difference between a quick account resolution and an escalated call. It is important to continually train collection agency staff to convey a polite, pleasant tone on every call. Showing respect is simple, and can make the process easier for parties on both sides.
Also be sure to avoid statements such as:
“Sir, you need to stop talking to me like that.”
“Ma’am, you need to calm down.”
Reynaud cautions that telling someone what they ‘need’ to do will work against your goal of a quick account resolution. “Any time you say the word need, or tell a consumer that they need to do something, this will instantly escalate a call.”
Sometimes, a debtor will become irate even when you are keeping your cool and showing respect. In this case, it is best to hang up rather than engaging with the consumer. Train collectors to back away from conflicts. Agents should tell disgruntled debtors the call will be disconnected if they continue to behave disrespectfully.
Don’t Be a Pest
Call frequency can also determine how quickly a debt will be resolved. Too many calls placed to a debtor may become irritating, or make them feel less motivated to cooperate with the collection process. Not only this, but excessive calls can also violate the FDCPA’s harassment rules.
You may feel that your calls are justified, but Coleman cautions that it is important to understand how telephone calls are examined in harassment suits. While a collector may attempt to reach a debtor ten times on three different numbers, a harassment suit is likely to only include the total of 30 calls placed. Even if numerous calls feel appropriate to an agent, this may not be how it appears to a debtor (or is illustrated during a lawsuit). Always be mindful of your call frequency.
While calling too often can be considered harassment, this does not apply to calls if a collector is not able to make contact. Courts have found that harassment must be proved through needless and excessive calling, with the intent to harass. Coleman explains that calling multiple times because you have not been able to make contact “is merely indicative that you are trying to reach them (the debtor) and does not have any element of harassment.”
Not reaching a debtor, or not receiving a payment may tempt collectors to keep calling. However, Coleman urges agents: “Find out why you’re calling.” If you don’t have a clear plan, calling may seem excessive or even counterproductive to resolving the account.
Try reaching the debtor a different way, or ask them when they will have the money to pay their bill. Scheduling a follow-up date with the consumer is one of the best ways to avoid the appearance of needless harassment. And what’s the right number of follow up calls? The CAC panel consensus is that collectors should only make contact once or twice per week.
The subject of reaching a debtor at their place of business is tricky. Calling consumers at work is sometimes unavoidable, as they may keep the same business hours as your agency staff. However, it can open collection agencies to liability. Some employers prohibit collection calls in the workplace. And as the U.S. code states:
“A debt collector may not communicate with a consumer in connection with the collection of any debt at the consumer’s place of employment if the debt collector knows or has reason to know that the consumer’s employer prohibits the consumer from receiving such communication.”
FDCPA rule 1692c(3) https://www.law.cornell.edu/uscode/text/15/1692c
It can be difficult to know if you are calling a business that follows this policy, but it’s always best to err on the side of caution if you suspect it isn’t allowed.
But don’t let this be the end of the line for speaking to your debtor. In order to plan for further contact, simply apologize for the possible inconvenience. Ask if there is a better phone number to use, or a better time to reach them. Empathy for the situation will help you to set a date and time for your next contact, and save both you and the debtor time and grief.
The takeaway from this section on telephone collection communications? Training is key. Collection agencies should have little problems adhering to the regulations as long as they have a well-trained staff. For an easy-to read guide on telephone collection communications best practices, fill out the form below.