The Most Comprehensive Guide Rent To Own Collections Operations
This is the beginning of an an online-manual that tells it like it is when it comes to collecting on rent to own customers. And being that it was written by one of the best debt collector’s in the country, you know it’s gotta be good. Ha.
That said, I’m a District Credit Manager with a well-known RTO business that started the trade with a well-known financial lending organization.
This gig in general (debt collection) landed in my lap after the economy tanked back in 2008. An old friend asked me of I wanted to sign up for debt collection with Capital One after I graduated from Virginia Commonwealth University (VCU).
I didn’t want to say, yes, but I accepted the position because my options were extremely limited in 2010.
On the other hand– I ended up dominating this very not-so-sought-after career and I ended up teaching people how to do it as time went on.
With that out of the way lets go ahead and talk about the cornerstone of a rent to own operation: the types of customers you have to deal with.
The Customer That Pays Every Payment
This customer is often a customer that calls in their payment on Saturdays or they’re set up on autopay. That’s not always a given but pretty close to being accurate. They typically call in, know that they are fortunate to have a lender because their credit is terrible and they gave respect for the business. An account manager love these customers. Why? Well, because you don’t really have to call these folks. You can place a hold on their calls after you contact them, set a promise (PTP) and they easily communicate their business. Customers that pay require little coaching and it’s good to identify these folk in your tracker so you don’t spend time on non-value activities.
The Slow Pay Customer That Needs Coaching
The customer that needs coaching is on the fence as to whether he or she wants to pay their bill. They have a trend to pay every other payment much like the customer that pays, but they choke from time to time. They choke because they often have the money, but they don’t want to spend it because they know they aren’t stable enough financially to constantly pay their bills “on-time”. These are the customers that can either make or break a debt collector. They are tough accounts to work for a rent-to-own business that I work in because we’re always about the money. Even it it comes in slowly. However, these customers will hold your credit numbers (your delinquency rate) hostage and they will inflate your overall past due balance of customers. If your slow pays start to get out of control, I advise that you make repossession field calls to show your customers that they do not dictate the business you conduct. At the end of the day, rent-to-own merchandise is the lenders until paid for.
The customer you can’t find
These are the people that ruin an RTO business. These people basically come into an rent-to-own business with an intention to steal. These customers, at the end of the day, are the sales’ staffs problem. Customers that never answer the phone and they move quite frequently have notes filled with skip trace notes and reference calls that run a mile long. And to put it simply, they’re just pretty darn good at dodging the debt collection system. And I’m not ashamed to say it, but if you’ve lent money to these people you should have done a little more research on your debtor. In my business however, the collectors bare the brunt of the situation and have to either find them, or write the account off.