Contact Center: Unplugged

Debt Settlement – No Longer a Dirty Phrase

Author:  Allyson Boudousquie, Director of Business Process Marketing for the PerformanceEdge Group at Aspect

It used to be commonplace for American consumers to refinance their homes for more than they owed, then use the extra cash to pay off credit cards and other debt. But, the unstable economy has brought with it a credit crunch, as well as a significant drop in home values. As a result, many homeowners have lost the ability to borrow against their homes, and the number of past due accounts on all types of debt has risen to massive proportions.

On one side of the fence, you have lenders who are looking for new and innovative ways to recoup more of the money they have paid out. And, on the other side are consumers – a large number who are genuine in their desire to pay back what they have borrowed, but are struggling to stay afloat. When both of these parties come together to agree on a debt settlement, it’s often a win-win for everyone.  By agreeing to settle, lenders often recover more money than they would otherwise have gotten back ($700 is better than $0 on a $1,000 loan), and consumers gain the ability to make payments that actually fit into their budgets.

So, how can you use settlement offers to increase your collections results?   

Start by creating strategic lists that target the right contacts – people who you believe would be willing and able to make settlement payments.  With campaign optimization tools, you can aggregate, then slice and dice data based on criteria such as delinquency, credit bureau scores and risk scores. Using sophisticated filters, exclusion and Best Time to Call capabilities, you can identify and target the right customers so that you can proactively call them where and when you will be most likely to reach them.

After you cull your list, you may find that it makes sense to create a “settlement queue” that is solely comprised of agents and/or subject matter experts who specialize in structuring and negotiating settlement agreements. Another option is to have regular agents reach out to these customers, talk to them about their options and, when a customer expresses interest, transfer that customer to a special “gate” where final negotiations take place and terms are agreed upon. Whatever you decide, it’s important that you continue to refine your targets and your strategy as you develop a successful debt settlement history.  Doing so will help you ensure the best possible business results.

Have you structured settlement negotiations yet? If so, we’d love to hear about what you’re doing and the technology you’re using.

Author: Aspect
Catergories: Collections, Contact Center Technology, Performance Optimization

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