Skip Tracing Automation Part II

The second reason we’re starting to see progress in improving contact rates on no contact customers centers around the advancement of the use of Workflow Automation to Gather and Organize data. This can be a valuable tool, but only if you gather an appropriate amount of data and only if you document the results of this data against the data sources and the data attributes to help determine the value of the data. Once you know the value of the data, you can build more intuitive workflow and process management around the data, and how it’s used. Immediate example; what phone numbers should you call in what order to help make contact on no contact accounts.

Now that we’ve seen success the first users of the callQueue over the past year in Phase I, and now with a few beta users of the second Phase of the callQueue we're launching shortly after our User Conference tomorrow at UCW, let’s talk about how we can improve on that by building and streamlining the most effective data gathering steps and actions to determine who is being called, when and why.  

STEP ONE. We believe that prior to initiating skip activity, you first have to make a documented, exhaustive effort to locate and contact your customer, and the co-signer. This process should be mono-focused on gathering and organizing as much customer data as you can find, in an automated, seamless and trackable manner. As an example, once you’ve gone either 30 days without a payment or without contact, and some lenders would move that number down below 30, the first step is to immediately locate all possible phone numbers for your customer and your co-signer, and call them! Now we know you can’t call most of these numbers you gather in the dialer as you likely don’t have express consent, so that’s where the callQueue within masterQueue comes in. It displays the phone numbers to call, in an order that’s based on an algorithm that incorporates specific data attributes and historical results of the data as its consumed and documented. For example if the phone number was first reported recently, say within the past few months, and its from a data provider that scores higher RPC rates than other data providers, then the score of the number in mQ will be higher than numbers without those attributes. It's not a perfect science yet, but we’ve been doing this for several years and we have a lot of historical data and results to keep improving the modeling, and ultimately, the results.

masterQueue automates the gathering of these customer/COX phone numbers from multiple data sources that includes everyone you want to be gathering customer phone numbers from, including Equifax, Transunion, Experian, CBC Innovis, Lexis-Nexis, TLO, Clear, IDI, White Pages, Enformion, Factor Trust and many more. We then put them in order of which numbers to call. The final part of Step One is simple, just call all the customer/COX phone numbers.

CAUTION: FREE DATA is NOT FREE. I am still surprised that people still use “FREE DATA” and many lenders think the “free data” their collectors get on the web is actually “free.” No high performing skip companies or skip tracers I know use “Free Data” as they understand the difference between GLB data and Non GLB data, and non GLB data is what usually makes up free data. 

USING NON GLB DATA IS WASTING VALUABLE TIME. Many times, the phone numbers provided from “free data” are not accurate as these sites do not have access to GLB level data. GLB stands for the Gramm-Leach-Bliley act which regulates the collection and disclosure of private financial information, and most free sites use unregulated data that contains errors in many cases. There is a level of permissible purpose a lender or their vendor needs to prove to the data provider, so they can get access to GLB data, and many sub-par data providers only have access to non-GLB data. As most of the “Free Data” is contained in unstructured web sites, collectors and skip tracers looking for this data have little control of the time spent looking for this lower grade of “free” data.

BOTTOM LINE - We recommend you block free data sites as there is no way to manage this process and we know the data is subpar. There may be no cost to the data per ph#, but the cost is in the wasted labor looking for it and the wasted time and regulatory risk in calling the wrong numbers more times than with structured, GLB data. The data providers I mention above only sell GLB data.

COST. At an industry average of $30 an hour “all in” for what you pay a collector, time is money. If the collector collects $400 an hour, can they afford to waste 5 minutes looking through Google or other free sites for phone numbers? That phone number just cost you a lot of money if they lost a valuable 5 minutes of time. At a run rate of collecting $400 an hour, 5minutes of time has a value of $33 and that’s a lot of time and money wasted, and it’s probably the wrong number. With GLB data, it would have cost you a quarter for the GLB ph#, if you paid a reputable data provider for it, one that has GLB access to data.

RISK. A few days ago we saw a major lender get sued in a class action case for allegedly calling the wrong person, and allegedly calling the person over and over again in a dialer. The question is where did that phone number come from? Did a collector get it from a free site and then plug it into the customer’s account in the system of record and the dialer picked it up and started calling it, over and over again?

TIP: Having a step-by-step process after you have exhausted the customer and co-signer phone numbers is critical. Once the account is two payments past due, the risk rises significantly. What we see too many times is clients waiting to begin “skip tracing” until the account has gone too long with no contact. It’s not always even a skip, but it becomes one when the lender waits too long to reach the no contact customer.

 This brings us to STEP TWO in the data management process of contacting a customer you’ve lost touch with, i.e. skip tracing.

The Fair Debt Collections Practices Act, FDCPA, clearly defines location information as:

§ 803. Definitions

The term "location information" means a consumer's place of abode and his telephone number at such place, or his place of employment.

In section FDCPA 804, the law goes on to define the rules of how you can get this location information when you do not have it. If you have been calling the phone numbers the customer gave you for 30 days and the customer is not communicating back to you so you can help them resolve their delinquency before it gets too late, i.e. 3 payments past due or greater, you need to locate your customer so you can help them. You need their location information.

You can try free sites, but we’ve already explained that's not as helpful as you need it to be. You also can try looking for GLB data in data provider web sites, which is what most lenders do after the account goes 30 days with no contact. This is where the problems we see start. Usually the “looking for data” process is an undefined, untracked manual data gathering process that involves multiple collectors toggling between data provider web sites, or in some cases only using one data web site which has a risk/reward factor to it as well. They look at and buy the same data over and over again, they copy and paste bits of it back to their system that can only be reviewed by scouring through dozens of notes written in a way there is no way to decipher the intent on buying and copying that data, other than it was what that persons intuition told them to do. On top of this, it’s almost impossible to track because every collector does it differently and most have a hard time putting into words why they do what they do, when and how.

I’ve yet to see a well-documented, standard process every collector follows that contains deliverables around a defined skip tracing process, or around the manual data gathering process. In a nutshell, it's kind of a mess, which is why most lenders outsource the problem to 3rd party collection, skip, repo and deficiency vendors. We’ll be discussing solutions to this problem at our annual user conference at Used Car Week on November 14th, and some of the top skip vendors in the country using masterQueue will be in attendance. We believe they are a large part of the overall solution to helping build a unified process that connects lenders and vendors working on the same problem, in the same software, and on the same team.

In 804, its states you can attempt to locate the customer, and the rules are pretty simple:

§ 804. Acquisition of location information

Any debt collector communicating with any person other than the consumer for the purpose of acquiring location information about the consumer shall --

(1) identify himself, state that he is confirming or correcting location information concerning the consumer, and, only if expressly requested, identify his employer;

(2) not state that such consumer owes any debt;

(3) not communicate with any such person more than once unless requested to do so by such person or unless the debt collector reasonably believes that the earlier response of such person is erroneous or incomplete and that such person now has correct or complete location information;

So, we know these calls to 3rd parties who may have customer location information cannot be made in a dialer, so the question is how do you build an efficient process to automate this using the callQueue to drive results?

It’s unbelievably simple, and it can be defined in a few short words:

“Here is the number, just make the call.”

If your non-dialer, manual collectors and skip tracers are not making the 200+ calls a day we see callQueue collectors and skip tracers making when fully productive, you are missing the use of a very valuable tool in skip.

In Part III on Thursday, we’ll dive more into what numbers to call, how do you determine which one’s are best, and how do you build a defined skip process around the technology needed to track everything to insure compliance and efficiency.