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Skiptracing Fundamentals
Well, Joe Blow ---
one of your most faithful customers --- has skipped
without a trace! You should have realized something was
wrong when he didn't show up two days before his due
date.
One of your
employees says: "Maybe one of his kids was sick, or the
car broke down. But I know he'll be in . . . may be in a
couple of days" So you put off calling him. No need to
upset one of your BEST customers! So you
wait a couple of weeks, then it's time for another
payment --- but no one has heard from Joe. And when you
tried to call last week, the phone had been
disconnected. Now you begin to wonder what's happened!
Did Joe lose his job? Is he ill? You better send someone
over to check on him (and remind him about last month's
payment!).
BAD
NEWS!
"Boss, you ain't
gonna believe it, but Joe's house is empty! There ain't
even a scrap on the floor. They took everything. And the
mail box is plum full of bills, and the light company
has left notices on his door, . . ." And now it
sinks in: Joe took off with all the "stuff" you paid
for, and left you holding the bag. It isn't funny, is
it?
Now you need to
think about finding Joe so that you can get the rest of
your money. So, where do you start? Where does the
skiptracing process begin? When do you start trying to
prevent such a loss? How do you protect your
investment?
START AT THE
BEGINNING
The best way to
catch a skip is before you put merchandise in his/her
possession. I know how it hurts to lose a sale! I also
know how it hurts to lose a couple of thousand dollars
just because I didn't pay attention to the obvious signs
on a loan application or rental order.
It is difficult for
some businessmen to understand that you begin your
skiptrace BEFORE you ever meet Joe. How do you do that?
Before you ever begin extending credit, or let someone
rent-to-own, you need to have a process in place to help
you to be able to track Joe if he decides to run. This
would involve things like the type of application form
you use. The more information it requests, the better.
Don't let Joe leave a lot of blank spaces either, as it
will be harder to fill them in once he's decided to take
off. And when you begin tracking him, you'll have to
fill in those spaces in order to find him. One company I
worked for even photographed each contract being signed
for use in court if the customer disputed the signature
on the contract. It was a time stamped / dated photo
taken from behind the counter. The customer never saw
the camera, but there was a large notice that the
photo was being taken. They had a 3' section of counter
where contracts could be signed. Contracts were never
allowed to be signed anywhere else in the
store.
Make sure that the
people Joe lists as relatives and friends actually know
him. If Joe gives you a wrong number, get the right one
before you approve his application. VERIFY EVERYTHING!
(And if Joe's handwriting is difficult to read, rewrite
the numbers clearly next to his writing --- don't cover
up his handwriting! I'll tell you why later.)
Joe says he's
worked at his present job for 5 years, but when you call
they say he just started 2 weeks ago. Do you hear the
warning bells going off? Feel the hairs on the back of
your neck standing to attention? Don't ignore them. This
is someone who is probably not going to pay. I know what
I'm talking about because I have been involved in
extending credit, collections, repossessions, and
finally skiptracing. Selling is fun and rewarding, but
when you have to give away all your profit to a
collection agency it loses much of its appeal.
MAKING TRACING
EASIER
If you follow the
idea in the preceeding paragraphs, you will have a two
fold benefit.
But how do you go
about doing a skip trace? What items should I ask for
that will help me when I do have to begin a skiptrace?
First, EVERY
question in your application must be answered! If they
need a phone book, give them one. Do they need to call
someone to ask how to contact their aunt Sarah who lives
3 states away? Let them call. Are there things they
can't remember, let them bring the application home.
Don't rely solely on TRW or Equifax. Many small
creditors NEVER report skips! The skip knows that, so he
pays his Sears card, and his truck note, but the Family
Furniture Store is never paid ---- EVER!
SOME of the things
you will need:
-
Picture
Identification (Don't even ask! If you don't require
it, you're skating on thin ice.)
-
Full Name
(including middle name if they have one)
-
Date of Birth
(check it against their drivers license)
-
Access to Credit
information (TRW or Equifax) or a skip reporting
service (Teletrack).
-
5 personal
referrences. At least two must be blood relatives, but
never all (You'll find out why.). At least two of his
references should see Joe every day!
-
1 relative should
live "out of state" but be "close" enough (not
"geographically", but family wise) to know where they
are . . . and where they've been!
The list could be
much longer, but you'll get the idea as you go along.
When you see how much easier it is to track someone when
you have a place to start, you'll wonder how you ever
could do business any other way again. Skiptracing is
not something you start after a customer disappears! It
starts from the moment they want to do business with
your company. If you want to protect your assets, start
today.
One more thing:
When a customer refinances, or adds on to an existing
contract, you should "update" their application if it
has been more than 6 months since they filled out an
application. While some people do skip on their first
purchase, the ones that are most difficult to track are
the "old faithful customers" who have not "updated" in a
couple of years. Why?
For 2 years, Joe
always came into the store to make his payments. You
never had to send anyone out to dun him. But, when he
added on that high end computer system 3 months ago he
forgot to tell you that he had moved 3 times in the last
18 months and changed jobs twice. Since he carried the
computer system home with him, your employees never were
told about the change of address. He dropped his home
phone in favor of one of those "prepaid" cell phones,
which are very difficult to impossible to track (they
never check the address of the customer because they get
their money in advance), or maybe a prepaid land line
which he has listed under a fictitious name (again, they
never worry about who the customer really is as long as
they get paid up front) or even a child's name --- and I
know of one who registered under his dog's name!
By the way, Joe is a real person I had to
deal with. I just changed the name . . .
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