Debtor Profiles
An understanding of the typical profiles will help a debtor collector categorization of a delinquent account collection potential paths, and assigning a collection strategy. The most common types of debtor include:
* Fast payer. The debtor pays bills on time is a good risk, and represents most of the credit account.
* Slow payer. This debtor’s resort to stalls, broken promises, and tends to procrastinate. There are two subcategories:
1. Unintentional slow payer falls short of meeting the obligations due to circumstances, but ultimately does come to terms with the creditors. The unintended slow payer is the simplest of all collections of the effect.
2. The deliberately slow payer initiates tricks to evade the payment, the budget of a possible skip may be considering bankruptcy, or has taken steps to make himself judgment-proof.
* Careless debtor. This debtor is not concerned with details, is often negligent, and usually ignore the payment notices.
* Recalcitrant debtor. This debtor’s position that the debtor was in control. This debtor will pay debts at ease on his own terms. This type of person will be a challenge for the creditor on all fronts, but will eventually settle the obligation.
* Impenetrable judgment-proof debtor. The debtor is a virtuoso on the art of concealing assets, not responding to pressure, is a mockery of the legal system, and lives of controversy.
* Deadbeat. This debtor never intended to settle the obligation. The debt was incurred with intent to defraud. This is a debtor out-and-out credit criminal.
* Liar. This debtor, a normal or a pathological liar, proclaims reassurances. This person usually pays at the eleventh hour, when a dispute arises, or other consequences if he fears more in proportion to the amount of the debt. Discretionary corporate debtor. Maintains an exemplary payment history with creditors to select (due to the maintenance of a relationship), but defaults on obligations where this mentality has no further use for client’s creditors. Most common in the corporate environment (ie, the officer shall pay his debts of consumers, but defaults on corporate obligations).
* Spring. Jumps into two categories:
1. Skip unintentional moves out of town without paying, but leave a forwarding address and is easy to find. Usually the debtor easily motivated to settle the obligation.
2. The deliberate skip one leaves no forwarding address and treat its tracks. In this respect, the deliberate, lettuce, depending on the person that the degree of expertise, can vary from mild (ie, a minimal effort to localize) all the way to the “professional” skip, which initiates extraordinary maneuvers to creditors to avoid coverage. Nevertheless, even professional skip a paper trail that a skilled skip tracer can follow leave.
* Discretionary consumer debtor. This type of debtor tends to pay bills primary (ie, Telephone Company, utilities, and prestigious credit cards), but ignores other accounts department store bills, small loads, mail-order transactions, and so on. This debtor is a “schizophrenic” personality, usually has a good credit rating, and know which credit transactions reported. An unsuspecting lender may be misled as a result of these favorable credit profile beneficiaries. (See Chapter 8 for more on credit profiles.)
* Intermediate credit crime. This type of debtor intentionally and with actual malice, makes a living by ripping off creditors.
* Professional commercial “credit criminal.” This is the real criminal minded debtor. Such a person resorts to elaborate, sophisticated systems for hundreds of thousands of dollars of credit to buy. Usually this is a punishable Shell company as a front, with a name similar to that of another, legitimate commercial. The credit criminals, endowed with a “silver tongue,” anticipates restoration of the legitimate business of the borrower’s creditors to appease ’suspicions and to hundreds of thousands of dollars in merchandise. The debtor will then quickly liquidate merchandise, often below cost, on a large scale, and walk with Megabucks, all the while protected by a corporate umbrella. This professional credit was certainly the most dangerous criminal. Interestingly, the debtor pays the majority of small, common obligations and usually has an impeccable credit history at the consumer level. This debtor, even a highly respected citizen in a community. This scam is also known as a “bust-out scheme.
* Temporary debtor. This type of debtor is a perpetual skip, moving often with the intention to evade creditors. This debtor moves on a Friday night, leaving no forwarding to address.
* Threats or intimidation debtor. This type of debtor’s creditors threatening a harassment suit, creating frivolous excuses, create disputes, and thrives on beating the system. An expert in fabricating stories as a smokescreen, the debtor is “always right.” Another version of this mentality debtor will threaten a harassment suit by a lawyer.
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