Collection Strategy & Escalation Flashcards
7 cards from real CCP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Collection Strategy & Escalation flashcards as text
A 'roll rate' analysis in collections measures:
Answer: The percentage of accounts that move from one delinquency bucket to a more severe bucket
Roll rates track the progression of accounts through delinquency stages (e.g., 30 to 60 days past due), helping forecast losses and evaluate collection effectiveness.
When calculating the 'cost per dollar collected' (CPDC) metric, which of the following cost components should be included?
Answer: Agent labor, technology, legal fees, and agency commissions
CPDC is a fully loaded metric that includes all direct collection costs—labor, systems, external agency fees, and legal expenses—divided by total dollars recovered.
Which escalation trigger is most commonly used to move a commercial account from an internal collection team to an external commercial collection agency?
Answer: Account reaches 90+ days past due with no response to multiple contact attempts
External agency referral typically occurs after the internal team has exhausted contact attempts through the early-stage delinquency period, usually around 90+ days past due.
A 'vintage analysis' in credit and collections is used to:
Answer: Compare delinquency performance of loan cohorts originated at the same time
Vintage analysis groups accounts by origination period and tracks their delinquency or loss performance over time, revealing credit quality trends by origination cohort.
Under the FDCPA, which of the following disclosures must a debt collector include in the initial written communication to a debtor?
Answer: The amount of the debt, the name of the creditor, and the 30-day validation notice
The FDCPA's 'mini-Miranda' and validation notice requirements mandate disclosure of the debt amount, creditor identity, and the consumer's right to dispute within 30 days.
Which collection channel has shown the highest consumer response rate for younger debtor demographics (18-34) in recent industry studies?
Answer: Text message (SMS) and digital self-service portals
Younger debtors are significantly more responsive to digital channels such as SMS and self-service portals compared to traditional phone or mail-based outreach.
A 'consent judgment' in commercial collections differs from a standard judgment in that:
Answer: The debtor agrees to the judgment without the creditor having to litigate the full case
A consent judgment is a negotiated agreement in which the debtor acknowledges the debt and stipulates to a judgment, saving both parties the time and cost of full litigation.