• Are you interested in hiring an easy to use collection agency with extensive experience in recovering dues for credit unions of all sizes?
• A collection agency that adheres to the same stringent data security standards required by banks and credit unions (GLBA compliance), ensuring your customer data remains secure and your organization stays compliant with all federal and state laws.
• Have you implemented a consistent and effective collection process? We understand how to maximize recovery, and in case you are short staffed we can perform low cost fixed fee service by sending low-cost reminder notices to your customers on your behalf.
A collection agency for credit unions can help you significantly improve your collection results while at the same time reducing the overall cost of collections.
It is essential to hire a collection agency that understands the importance of the delicate relationship with your customers. The collection process needs to use amicable strategies to preserve your reputation, while delivering outstanding recovery rates.
Serving Credit Unions NationwideNeed a Collection Agency? Contact UsHigh Recovery rate. Referrals of existing Credit Union clients can be provided if requested. |
Third-Party Relationships (and importance of customer’s data security):
Regulators are focusing on relationships with vendors, service providers, and fintech partners. Credit unions will be held accountable for any breaches of data or non-compliance with consumer protection laws by these third parties. Therefore your collection agency should be GLBA Compliant, means it should follow same security standards which financial institutions and credit unions must follow.
Credit unions are known for innovative products and friendly staff. Unlike big banks with a nationwide presence, credit unions cater to a limited region and usually have less than 5-10 branches. Debt recovery is a very tricky situation for credit unions in particular. They can get upset if they apply too much pressure on customers to recover the money. Having bad reviews in the form of word of mouth or online reviews on platforms like Google may do instant damage to the credibility of a credit union.
Implementing these strategies can help credit unions reduce their outstanding loan defaults:
- Strict Loan Issuance Policies: Implement stricter policies when issuing loans. Conduct thorough credit checks and only extend loans to individuals with a strong credit history.
- Loan Monitoring: Regularly monitor the status of loans. If a member is late on a payment, follow up with them promptly. Timely intervention can prevent a small issue from becoming a large problem.
- Early Intervention: Initiate the collection process as soon as a loan goes into default. The earlier you start the collection process, the better your chances of recovering the money.
- Offer Flexible Payment Plans: If a member is having difficulty repaying their loan, consider offering a flexible payment plan. This could involve reducing the monthly payment amount and extending the loan term.
- Education and Communication: Provide education for members about the importance of timely loan repayments and the potential consequences of defaulting on a loan.
- Incentives for Early Repayment: Offer incentives for early repayment of loans. This could be a reduction in interest or other rewards.
- Collection Agencies: For loans that are significantly overdue, consider turning to a collection agency. This should be a last resort as it can damage your relationship with the member.
- Loan Loss Provisions: While this won’t reduce the amount of outstanding loans, setting aside money to cover potential loan losses (a loan loss provision) can help protect your credit union’s financial health.
- Regular Audits: Conduct regular audits of your loan portfolio to identify potential issues and develop strategies to address them.
Their comprehensive collection process combines flat fee reminders with contingency collections, efficiently sending your members the right messages at the right time. A collection agency can reduce delinquency rates without resorting to expensive collection actions that offend your members, along with automating your processes by sending low-cost payment reminders that boost recovery. Their services should be in 100% compliance with the new banking laws.
Credit Unions issue various loans. These include auto loans, student loans, mortgage debt, small business loans and credit card loans. They are also entitled to overdraft fees when withdrawal from a bank account exceeds the available balance. However, many customers cannot return the outstanding amount and the accrued interest to the credit union. Even those customers who fail to pay the overdraft fee often dispute it. Unfortunately, accounts receivable is an ongoing problem for Credit Unions nationwide.
Nearly all credit unions have an internal team that follows up with customers running behind their payment obligations and attempts to recover money from them. Depending on the type of loan and internal financial policies, an account is considered delinquent after it is more than 60 to 180 days past due. However, many of these accounts are tough to recover and often become too risky. Such delinquent accounts are forwarded to a third-party collection agency. A good collection agency should offer both pre-collection and standard collection services.
A collection agency’s efficient recovery process helps credit unions maximize their profit by reducing charge-offs while maintaining positive customer relations.
Hiring a collection agency takes the pressure away from credit unions since demands are made in the name of the agency. Equipped with advanced collection techniques and tools, the staff of collection agencies uses a diplomatic approach to recover money from debtors. According to the federal debt collection laws, debt collectors are prohibited from using abusive, unfair or deceptive practices to collect debts. Debt Collectors work with debtors by maintaining a respectable approach yet very effective. Debtors who cannot pay the entire amount are offered to make payments in installments.
Calls originating from Collection Agencies are impactful and effective. Collection agents are seasoned professionals recovering money for their clients all day long. They are well-trained on handling debtor excuses, and their mild pressure tactics are adequate to collect money from those hard-to-handle debtors. A collection agency for Credit unions is also required to follow specific security standards to ensure the safety of client data.
A credit union collection agency will offer various services, including Collection Letters, Collection Calls and Filing a Legal Suit if necessary. They offer both fixed fees and contingency services.
A combination of collection calls and a collection attorney notice is very effective for foreclosure debt.
| Credit Union Collection Agency Services Include |
| Collection Letters Service |
|
| Collection Calls Service |
|