Overdue Amounts, Delinquent Accounts, and Compliance

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Question:

What kind of compliance would be required for a software which manages delinquent accounts and helps recover overdue amounts?

Answer:

The Fair Debt Collection Practices Act and/or a state version would be the first things to review.

by Mary Beth Guard

Another thing to look at is how the software you've chosen will take into account any contract provisions (in the promissory note, security agreement, mortgage, etc.) that might place requirements on your institution or might give the borrower special rights. Also, make sure the software correctly calculates amounts due. One of the hottest areas of liability under FDCPA is where the debt collector demands payment of amounts which the lender is not entitled to.

First published on BankersOnline.com 9/3/01