Chapter 13: Collection & Recovery

Who said this, "Debt, grinding debt, whose iron face the widow, the orphan, and the sons of genius fear and hate; debt, which consumes so much time, which so cripples and disheartens a great spirit with cares that seem so base, is a preceptor whose lessons cannot be forgone, and is needed most by those who suffer from it most."

• Ralph Waldo Emerson

• Michael Scott

• Socrates

• Robert Frost

Of the loan types listed below, which typically has the highest delinquency rates?

• Auto Loans

• Unsecured Loans

• Mortgages

• Secured Loans

"Secured loans usually have the lowest delinquency rates because borrowers tend to make these payments first to avoid losing their assets which secure these loans."

• True

• False

Delinquency rates tend to increase when interest rates are lower, because consumers are refinancing higher-rate debt with new lower-rate loans.

• True

• False

Which of these is not an objective of collections and recovery?

• Keep delinquencies within acceptable limits.

• Berate customers for not making payments.

• Keep loan losses within acceptable limits.

• Manage the collections and recovery functions cost-effectively.

Which of the following is a potential cause of delinquency?

• Unexpected changes in financial situation

• Irresponsible Lending

• Excessive Debt

• All of the above

Which of these is best describes a phase in the collection cycle in which a loan is more than 60 days past due and collection efforts and bank has been unable to contact the customer.

• Early Stage

• Customer Contact

• Serious Delinquency

• Charge off

Which of these best describes the Bankruptcy Code provisions for the court-administered liquidation of a debtor's nonexempt assets to pay creditors, and subsequently, the debtor is relieved of the financial obligations.

• Chapter 12 Bankruptcy

• Chapter 13 Bankruptcy

• Chapter 7 Bankruptcy

• Chapter 11 Bankruptcy