PCS Account Management & Resolution Techniques 3 — Questions and Answers
Question 1: A debtor in a payment arrangement misses one payment but immediately calls to explain a temporary hardship. Which response best supports long-term resolution?
- Terminate the arrangement and demand full balance
- Issue a breach notice then offer a modified arrangement reflecting the hardship (Correct answer)
- Ignore the call and flag for legal referral
- Reduce the total balance owed as a goodwill gesture
Correct answer: Issue a breach notice then offer a modified arrangement reflecting the hardship
Documenting the default while offering a revised plan balances creditor protection with the practical goal of recovering funds from a cooperative debtor.
Question 2: What is the purpose of an 'account scrub' before a collection campaign?
- To remove accounts from the portfolio permanently
- To verify contact data accuracy and identify accounts with legal restrictions such as bankruptcy or cease-and-desist (Correct answer)
- To automatically generate settlement offers
- To calculate interest on all accounts simultaneously
Correct answer: To verify contact data accuracy and identify accounts with legal restrictions such as bankruptcy or cease-and-desist
An account scrub ensures collectors do not contact debtors who are protected by bankruptcy stays, have requested cessation, or have deceased status.
Question 3: A debtor states they are represented by an attorney for this debt. What must the collector do?
- Continue contacting the debtor directly until written proof of representation is received
- Cease direct debtor contact and communicate only with the attorney (Correct answer)
- Request the attorney's bar number and continue collection
- Transfer the debt immediately to the creditor
Correct answer: Cease direct debtor contact and communicate only with the attorney
Under the FDCPA, once a collector knows the debtor is represented by an attorney, all communication must go through the attorney, not the debtor.
Question 4: Which of the following is an example of a 'soft' collection approach best used in early-stage delinquency?
- Immediate litigation referral
- Courtesy reminder calls emphasizing customer service and payment options (Correct answer)
- Wage garnishment proceedings
- Credit bureau reporting of the delinquency
Correct answer: Courtesy reminder calls emphasizing customer service and payment options
Early-stage delinquency often responds well to soft approaches that preserve the creditor-customer relationship while prompting payment.
Question 5: When documenting a collection account, which information is MOST critical to record after every debtor contact attempt?
- The collector's personal opinion of the debtor
- Date, time, result of contact attempt, and any commitments made (Correct answer)
- The collector's supervisor's name
- The creditor's internal account number only
Correct answer: Date, time, result of contact attempt, and any commitments made
Accurate contemporaneous records of all contact attempts and results are essential for FDCPA compliance and dispute defense.
Question 6: A debtor offers to pay the full balance if given 90 days. The standard arrangement policy allows 60 days. What is the BEST course of action?
- Refuse and demand payment within the standard 60-day limit
- Escalate to a supervisor for approval of an exception before responding (Correct answer)
- Accept the 90-day offer independently to close the account
- Reject the offer and send the account to legal immediately
Correct answer: Escalate to a supervisor for approval of an exception before responding
Exceptions to standard policy require supervisory approval; independently granting non-standard terms can create liability and inconsistency.
Question 7: What is 'account stratification' in a collection operation?
- Randomly assigning accounts to collectors
- Segmenting accounts by balance, age, and collectability to prioritize resources effectively (Correct answer)
- Reporting all accounts to the credit bureaus simultaneously
- Combining multiple debtor accounts into one file
Correct answer: Segmenting accounts by balance, age, and collectability to prioritize resources effectively
Stratification directs collector effort toward accounts most likely to yield recovery, maximizing efficiency and return on collection investment.
PCS Account Management & Resolution Techniques 3
A debtor in a payment arrangement misses one payment but immediately calls to explain a temporary hardship.
Which response best supports long-term resolution?