Collector's Challenge Month in Full Swing at Many ARM Firms
An effort to improve the debt collection industry's image is underway at many ARM firms. Spearheaded by the ACA, collectors will be raising money to improve financial literacy programs aimed at consumers.
ACA International is encouraging its members to participate in the organization’s “Collector’s Challenge” this month in a push to improve consumer financial literacy. Facilitated through the ACA International Education Foundation, the group’s philanthropic arm, the effort is aimed at improving the image of the debt collection industry.
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According to the Foundation, many ACA members will hold fundraisers and collect small, personal donations for the right to enjoy casual dress, with others planning special company outings open to those making a donation. Creativity is encouraged and the campaign is intended as a fun, engaging activity that also generates awareness of the Foundation's programs.
Money raised will be used to help the Foundation expand its work in financial education, such as providing free electronic Community Education Kits regarding consumer rights and money management basics and a free personal financial management Web course, which is offered free of charge. Other uses for the funds include the Foundation’s scholarship program for people in the collection industry and a training program for the disabled.
According to Jean Cottington, executive director of the Foundation, the collector’s challenge initiative started a couple of years ago as a result of a strategy laid out by ACA chairman Bill Wilcox.
“We wanted a way to educate consumers and help improve financial literacy,” Cottington said. “A lot of us can also brush up on [financial and customer service] tools during this difficult time.”
Rion Needs, president and CEO of debt purchaser Asset Acceptance Capital Corp., said that the economy gives the ARM industry an opportunity to help consumers. “During the current difficult financial environment it’s more important than ever that collectors see themselves providing solutions for debtors,” he said.
The lynchpin of this effort is providing better customer service, meaning “helping debtors find solutions, not haranguing them or beating them up,” Needs said.
With better financial education, one of the goals of the Collector’s Challenge, consumers can better handle their debt obligations, Needs added. So he sees it as an important effort for his company.
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Comment from Michelle - American Profit Recovery on April 10, 2009 at 11:03AM EST
I'm very proud to be involved in American Profit Recovery's efforts to raise money for this event. We have raised over $1500 in 10 days by offering our employees the option to purchase casual days, raffle tickets to win gift cards, a can drive and also lunch specials! Check out how we're doing at:http://www.collectionagencyblog.com/ Events like this help the community overall "Profit From OUr Difference."
Comment from Diane O. on April 10, 2009 at 2:12PM EST
I think this is a wonderful idea to help consumers find solutions to their financial difficulties. However, I would like to give the Collection Agency Industry some food for thought.
I have over 20 years in the Credit and Collection Industry and the most recent in a large telecommunications company. I changed directions in my career and for the last two years, I have been in the real estate business. In turn, I help many consumers that are first time homebuyers, and due to my backround, try and teach them to understand credit and have encouraged them to pay off their bad debt to improve their credit score. By doing this, they can be within lender guidelines to qualify. The standard is running around 620 minimum.
It has come to my attention lately that when consumers pay off their bad debts, especially older accounts, it actually impacts their scores negatively, because it brings an aged account to current. This in turn shows recent negative activity. This makes no sense to me because there should be a benefit to consumers who are doing the right thing. Not all lenders are credit score driven when doing an FHA loan, so many consumers can buy a home without paying off that debt. Why should they pay them if it hurts their score?
I might suggest to those advocates of the Collection industry to partner with the credit bureaus to somehow change this criteria in their scoring models and maybe there might be more success in encouraging those who fall into delinquent status, to pay their debts.
I will still continue to encourage my clients to pay off their bad debts because it is the right thing to do, but it would sure make life better for all of us (but mostly consumers) if this change could take place. I would be happy to help participate in an initiative like this if I am needed. I may be reached at diane@dianesfloridahomes.com