Client Relationship Management Flashcards

Which statement about the impact of debt settlement on a client's credit should an agent convey?

Answer: Missed payments and settled accounts are likely to hurt the client's credit score

Stopping payments and settling for less than the full balance usually hurts credit, and clients must understand this.

A client asks if forgiven debt could have tax consequences. What should the agent say?

Answer: Forgiven debt of $600 or more may be reported to the IRS on Form 1099-C and may be taxable unless an exception such as insolvency applies

Creditors may issue a 1099-C for canceled debt of $600 or more, and the client should consult a tax professional about exclusions like insolvency.

What is the best way to document an important client conversation?

Answer: Record accurate, dated notes in the client file right after the call

Timely, accurate notes in the official system support compliance and service continuity.

A client's adult son calls asking for details about his mother's account. What should the agent do?

Answer: Verify that the client has given written authorization before disclosing any information

Client financial information is confidential and can only be shared with authorized third parties.

A creditor offers a settlement that would use nearly all of a client's savings. What should the agent do before accepting?

Answer: Present the offer to the client, explain the terms and effect on other debts, and get the client's authorization

Clients must agree to each settlement, and the TSR requires client consent before fees can be earned.

Which communication style is most effective with a stressed, overwhelmed client?

Answer: Listening actively, acknowledging feelings, and explaining next steps in plain language

Empathy and clear language reduce anxiety and help clients make informed decisions.

A client is sued by a creditor while enrolled. What should the agent do?

Answer: Urge the client to respond to the lawsuit on time and refer them to legal help or the company's litigation support

Ignoring a summons can lead to a default judgment, so clients must respond quickly and get proper legal help.