Collections Quiz

Choose the right option-

no collateral needed to secure the loan

• Secured loan

• Unsecured loan

Answer explanation

For unsecured loans, no collateral is required, borrowers are funded based on their creditworthiness

Interest rate are tend to be lower in

• Secured loan

• Unsecured loan

Answer explanation

Borrowers put their asset as collateral against the loan, due to which interest rate is lower

Mortgage loan is a secured debt

• True

• False

___________is a federal law that limits the actions of third party debt collectors who are attempting to collect debts on behalf of another entity

• FDCPA

• FCP

• DRC

Answer explanation

FDCPA refers to Fair Debt Collection Practices Act

A number from 300 to 850 that represents customer's creditworthiness is called __________

• Credit Score

• Credit debt

• Credit liability

Is payment history considered in calculation of credit score?

• Yes

• No

Match the following

• Payment history, amount owed, new credit

• Credit score

• Student loan

• Debt Collection Agency

• Credit Card

• Revolving Debt

• Collecting customer's delinquency debt

• Non revolving debt

Match the following

• Write off remaining balance

• When collection activities fail, business may write off overdue amount as bad debt

• Overdue invoice is assigned

• Depending on customer's payment history and situation with business, adjustment made as per credit teams discretion

• Adjust credit limit

• When an invoice becomes overdue for payment, it is assigned to an employee for collection

• Issuing dunning letters

• Notifications to the customer that an account is past due, sent at fixed intervals

Monitoring accounts to identify overdue payments is the duty of

• Collection Manager

• Field Agents

• ACM

• RCM

Accounts Receivable is the money owed to an entity by its customers

• True

• False