CIP Skip Tracing & Debtor Location 1 — Questions and Answers
Question 1: What is 'skip tracing' in the context of debt collection?
- The process of locating a debtor who has moved without providing a forwarding address (Correct answer)
- The process of writing off uncollectable debt accounts
- A method for calculating interest on overdue accounts
- The legal process of filing a lawsuit against a debtor
Correct answer: The process of locating a debtor who has moved without providing a forwarding address
Skip tracing is the practice of tracking down a debtor who has 'skipped' their known address without leaving updated contact information.
Question 2: Which federal law primarily governs how collectors communicate with third parties when seeking location information for a debtor?
- The Truth in Lending Act (TILA)
- The Fair Debt Collection Practices Act (FDCPA) (Correct answer)
- The Equal Credit Opportunity Act (ECOA)
- The Gramm-Leach-Bliley Act (GLBA)
Correct answer: The Fair Debt Collection Practices Act (FDCPA)
FDCPA Section 804 specifically regulates how debt collectors may contact third parties when acquiring location information about a debtor.
Question 3: In collections terminology, what does the term 'skip' refer to?
- A debt that has been legally discharged in bankruptcy
- A payment arrangement that allows a debtor to defer one payment
- A debtor who has moved without leaving forwarding contact information (Correct answer)
- An account that has been transferred to a different collection agency
Correct answer: A debtor who has moved without leaving forwarding contact information
A 'skip' is industry slang for a debtor who has disappeared or relocated without providing updated contact details.
Question 4: Which of the following is a leading data aggregation platform used by collection professionals to locate debtors?
- LexisNexis Accurint (Correct answer)
- QuickBooks Online
- Salesforce CRM
- Google Analytics
Correct answer: LexisNexis Accurint
LexisNexis Accurint is one of the foremost data aggregation platforms used in collections to locate debtors through public records and other data sources.
Question 5: What type of information do 'credit header' files typically contain that makes them useful for skip tracing?
- Detailed credit scores and full payment history
- Name, address, Social Security number, and date of birth (Correct answer)
- Employment verification and current salary information
- Court judgments and bankruptcy filing details
Correct answer: Name, address, Social Security number, and date of birth
Credit header data refers to the identifying information at the top of a credit report — name, address, SSN, and DOB — which is frequently used to locate and identify debtors.
Question 6: Which of the following data sources is generally considered most current for locating an individual's residential address?
- A 10-year-old public record filing
- Utility company connection and service records (Correct answer)
- A voter registration record from a prior decade
- A school enrollment record from five years ago
Correct answer: Utility company connection and service records
Utility connections are frequently updated upon moving and reflect current residency, making them among the most timely sources for locating a debtor's address.
Question 7: What is 'address verification' in the context of skip tracing?
- Confirming that a postal address is deliverable and currently occupied by the targeted individual (Correct answer)
- Filing change-of-address paperwork with the postal service on behalf of a debtor
- Verifying that a collection agency has a licensed and valid business address
- Confirming that a debtor's legal representative has a registered office address
Correct answer: Confirming that a postal address is deliverable and currently occupied by the targeted individual
Address verification confirms both that the postal address is valid and deliverable, and that the targeted debtor actually resides at that location.
CIP Skip Tracing & Debtor Location 1
What is 'skip tracing' in the context of debt collection?