Latest Debt Collection Interview Questions

1) Explain what are the responsibilities of bill collectors?

Responsibility of bill collector includes

Identifying customers with back due accounts and notifying them by email or telephone
Negotiating repayment plans, maintaining electronic account and collection records
Referring customers to referrals to professional debt counselors
Forwarding statement of customers to legal bodies to take actions

2) What are the skills required to be a bill collectors?

Bill collectors should be good in communication and negotiations skill has they have to deal with customers who are in stressful financial situations.

3) What bill collectors can’t do while calling customers for debt collection?

Bill collectors can do following things

Using obscene or abusive language
Harassing customers with repeated calls
Calling before 8 am onwards or after 9 p.m.
Giving wrong amount of your debt
Calling at office hours even if you asked not to call
Sharing your debt information to others
Falsely claiming himself as law enforcement official or credit bureau representative
Threatening unnecessarily to sue you or seize property unless they actually plan to execute it

4) Mention what is the debt recovery procedure?

Contact customer and remind about their payment politely
Contact with an overdue payment reminder
If the customer still fails to pay the payment as per the terms of the payment, send them a final notice
Even after sending final notice if still there is no response from customer, try to make direct contact and ask for payment again
After failing all options, if the customer still resent from payment then send a formal letter of demand. This could be the last option as it may spoil your relationship with the customer.

5) What advice would you give to the customer to avoid bad debt?

Bad debt occurs when customer ignores small things like

Checking of a business and background of the client before offering credit
Setting safe customer credit limits
Release good only once the payment is cleared
Before shipping any goods wait for direct deposit payment to clear
As soon as a job is done send invoice to the responsible party
Give all information on your invoice about the mode of payment
Stay in regular touch with your client
For early payment of bills offer a small percentage discount
Bill Collector

6) What all ways a bill collector can collect his debt from a customer?

By direct communication with the debtor
Filing a lawsuit against the debtor
By taking custody of the property or selling customer property
By hiring debt collection service

7) Explain what is Fair Debt Collection Practices Act?

It is an act which is prevalent and valid in U.S, and it creates guidelines according to which the bill collectors may conduct business, and it also determines the rights of consumers involved with bill collectors.

8) According to, Fair Debt Collection Practice Act, who are the third parties that the bill collector, can deal with while trying to collect a debt?

Third parties include

The client or consumer
The client’s attorney
Client’s reporting agency
The Creditor
The Creditor’s attorney
The debt collector’s attorney

9) Mention what are the excuses customer usually makes to get away from debt payment? How to deal with that?

Customers usually have excuses like

Cheque is in post: Ask him to send a copy of cheque through mail and inquire about the cheque number, date and what name the cheque is issued. If they are telling you the truth then, it will provide you all the facts you asked for and if not then probably they are lying Not received any statement, notice or any invoice: It is the most common excuse you will face. Ask them to give their address and make a request to pay the debt on that day itself.

Account department operates only at 9am to 12pm one day a week: In such cases, think about the company size, is it really big to have an accounting department. And if yes, try to contact the director or partner of the company they can process your payment.

Debtor is never available: Try to get personal contact number through which you can reach the debtor if that is not working send a warning letter about the payment to the debtor’s address, and they should call you back.

Cash flow problem: If the client is really facing cash-flow problem ask him to pay the amount in small installment, if he is still resentful about paying the debt than refer them to a debt counsellor. If the problem is temporary then give him some time to overcome his problem but time should not exceed to a longer duration.

Signatory is passed away: Nothing much can be done in such cases, unless you have a proper legal paperwork that states the third party name for the payment if anything goes wrong with the main party.

Account is already been paid: If the debtor gives such excuses then try retrieve all the information like which bank account, date and day of the payment deposited, request to mail a copy of deposit slip, etc. If he stammers anywhere while giving information, then get alert it’s a red flag.

Too busy: Show appreciation to debtor that keeps him busy, and politely ask them to settle the payment without any delaying as it is the best interest for him.

10) Before filing a lawsuit against debtor what all things need to be considered?

Things to be considered before filing a lawsuit is

Is yours claim large enough to sue, as most attorneys in U.S will not file a lawsuit under $1000 and even $2000
Is debtor active in business or job
Find the correct address where you can send a legal notice to the debtor
Check whether debtor holds up enough cash or property to pay the debts
Some debtors won’t pay you unless legal action is not held, so hire an attorney who has experience in such cases
If the client has the upper hand then always go for a settlement, as they have rights to counter claim against you for damages
Can you provide enough proof or documentation that substantiate the debt
Will you be able to present a witness if needed
Does the cost include the warrant filing a lawsuit

11) Explain what is a letter of demand?

A “letter of demand” is usually issued by a bill collector to the customer, stating about the filing a lawsuit if payment is not done by debtor in given period.

12) How a bill collectors can contact debtors?

Bill collectors can

Make atleast three or more contacts per week by phone or letter
In one month can make more than 10 contact by any other mean like e-mail
Make a face to face contact more than once a fortnight