Practice Test Geeks(CCM) Certified Credit Manager Practice Test
← All CCM Flashcard Decks

Collections & Recovery Flashcards

7 cards from real CCM practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Collections & Recovery flashcards as text

  1. Under the Fair Debt Collection Practices Act (FDCPA), which communication time restriction applies to third-party collectors?

    Answer: Calls prohibited before 8 a.m. or after 9 p.m. local time of the debtor

    The FDCPA prohibits third-party debt collectors from calling consumers before 8 a.m. or after 9 p.m. local time of the debtor.

  2. A debtor sends a written cease-communication request to a third-party collector. What is the collector's required response?

    Answer: Cease all further contact except to confirm no further action or to notify of specific legal action

    Upon receiving a written cease-communication request, the FDCPA requires the collector to stop contacting the debtor except to confirm cessation or to advise of specific remedies.

  3. Which metric best measures the effectiveness of a collections department over a rolling period?

    Answer: Days Sales Outstanding (DSO)

    DSO measures the average number of days receivables remain outstanding, directly reflecting collection efficiency.

  4. A debtor disputes a debt in writing within 30 days of initial notice. Under the FDCPA, what must the collector do?

    Answer: Cease collection activity and provide verification of the debt before continuing

    The collector must stop collection efforts and mail verification of the debt before resuming any collection activity.

  5. In a Chapter 7 bankruptcy proceeding, what is the effect of the automatic stay on a creditor's collection efforts?

    Answer: All collection actions, including lawsuits and calls, must immediately stop

    The automatic stay halts virtually all collection actions against the debtor immediately upon the bankruptcy filing.

  6. Which collection strategy involves selling a portfolio of delinquent accounts to a third party at a discount?

    Answer: Debt sale / portfolio sale

    A portfolio sale transfers ownership of delinquent accounts to a buyer at a discounted price, allowing the creditor to recover immediate cash.

  7. What is 'skip tracing' in the context of collections?

    Answer: Locating a debtor who has moved or disappeared without a forwarding address

    Skip tracing uses investigative techniques and data sources to locate a debtor who cannot be reached at their known address.