Praise: the Great Motivator

During a recent visit to my daughter’s house I watched her compliment her three-year-old son. I don’t remember the exact reason or wording, but what I do remember—what stood out—is the way she delivered the praise. It’s so easy for any of us, much less a parent of two toddlers, to simply say “nice job” and leave it at that. But my daughter took a few extra seconds to make her praise very specific, leaving no doubt as to what she was praising. She also made an extra personal connection by adding how proud she was of him. I remember watching their interaction and thinking wow, great job! What a wonderful reminder this was for me on how to effectively give praise.

There is no question that offering praise is a great motivator. From a scientific standpoint positive recognition releases the neurotransmitter, dopamine, in our brains and makes us happy and feel good about ourselves. Along with creating feelings of pride and satisfaction, dopamine can also contribute to innovative thinking and creative problem solving. A Gallup research project which surveyed over four million individuals, determined that employees who receive regular praise are more productive, engaged and more likely to stay with the company. The research also indicated that those who receive praise regularly have better customer scores and enjoy better health.

In a previous blog “Positivity Matters: What’s’ your Ratio?” from September 2014, I wrote about the positive to negative ratio and the desired 3:1 (or greater) ratio for a positive workplace. Praise can be an excellent vehicle for providing positive interactions. Whether you are looking to motivate, encourage a behavior, reward, or simply brighten someone’s day, praise can be invaluable.

But beware, if done incorrectly or insincerely you run the risk of doing more harm than good. Oftentimes employee-of-the-month programs fail because if you dole out praise equally by letting everyone have an opportunity to “win” employees can see this as “canned” and insincere, or if the same employees win month after month, others may end up resentful.

When greatness is seen, praise it immediately! The more time that passes between the great accomplishment and the recognition, the less impact the praise will have. Also, positive recognition, like a good meal, is very enjoyable but its effects only last a short while. Make sure you look for opportunities whenever you can in both your work and personal life to offer genuine praise. Remember to be specific as to what you are praising and make sure it is praise worthy.

I’ll end with this quote from Maya Angelou, “I’ve learned that people will forget what you said, people will forget what you did, but people will never forget how you made them feel.”

Alliance Collection Agency, Inc. is a full service, licensed accounts receivable management and debt collection agency providing highly effective, customized one on one management and recovery solutions for our business partners.  Founded in northern Illinois in 2005, we have been proudly improving the bottom-line on behalf of our business partners in and around Chicagoland for over 10 years.

 

Credit and the Credit Bureau

There is a great deal of controversy and several lawsuits pertaining to FCRA law and the reporting and maintenance of data by data furnishers, such as collection agencies. As a collection agency that routinely furnishes data to the three major credit rating agencies (Trans Union, Experian and Equifax) we take our role in this process very seriously. We believe our data to be true and correct when it is furnished and placed into consumers’ files and reported to lenders. However, this does not mean that there are not instances were errors are made in the process.

At United Credit Service, Inc., we believe in the accuracy and integrity of consumer information reporting. We have policies and procedures in place so that we can be confident that our information is being correctly reported, and in most all cases, upon investigation it is.

Quite often we receive correspondence from consumers, and occasionally consumer attorneys, disputing the information we have furnished to the credit bureau. Along with the dispute, we usually get a threat of legal action should we not take immediate action to delete the disputed information from the consumer’s file, or provide proof of the debt which we are reporting. In many cases, this correspondence is received after the consumer has undertaken the dispute resolution process of the credit bureau that houses and reports the information to credit grantors.

This dispute resolution process includes what is called (ACDV) Automated Consumer Dispute Verification, which is triggered at the time a consumer files a dispute of a debt with the credit bureau. The consumer can dispute the debt for a number of reasons, a few of the more common reasons we see are: “The debt is not mine” and “The debt is paid”. Upon a consumer dispute being filed at the credit bureau that debt is “frozen” and cannot be updated until the dispute is responded to by the furnisher of information or 30 days has elapsed. The data furnisher has a 30 day period to do a diligent investigation of the dispute and make a report back to the credit bureau as to the status. If that 30 day period lapses with no response by the data furnisher the credit bureau is required to delete the debt from the consumer’s file.

The process of receiving, making updates to credit records and responses to consumer disputes is done thru a web based entity known as e-OSCAR (Online Solution for Complete and Accurate Reporting), which is a browser based Metro2 complaint system developed by the credit rating agencies as an online solution for data furnishers to process Automated Consumer Dispute Verifications (ACDVs) as well as Automated Universal Data forms (AUDs). AUDs are necessary when the data furnisher finds it necessary to update a credit record quicker than the regular activity reporting cycle process, usually incorporated with the data furnishers’ monthly collection remittance process. A for instance would be where it is necessary to have a record reflected as “paid” so the consumer information is being reported correctly to a lender. In some instances a lender requires this in order to make a favorable lending decision. We may also find a debt being reported in the wrong consumer record and would want this to be corrected as quickly as possible when we become aware of this situation.

Getting back to the ACDV process, the data furnisher will do their investigation as to the disputed debt and make a report back through the e-OSCAR system. This report will update all three bureaus that house and report this data to lenders. It’s not instantaneous, but the process works well to insure that credit records are being reported accurately and updated timely. E-OSCAR is not available to anyone other than registered data furnishers, therefore a consumer cannot access their credit file to make any changes to information contained therein (for obvious reasons). Only the data furnisher and the credit bureaus have the ability to change/update/delete data from a file. In order for the data furnisher to make an accurate response to a dispute the information and circumstances would be analyzed by the data furnisher to make a decision on a response. This may entail contacting the original creditor to verify their information obtained at the time the debt was originated. Information, such as: address, names, birthdates, Social Security numbers (where legally allowed) would be compared to that of the consumer who has made the dispute. In the case where a dispute is based on the debt being paid, the creditor would be asked to verify if their records reflect receipt of payment. The data furnisher will then respond to the ACDV when the investigation has concluded and information has been verified. Again, the process allows for a 30 day response period, but we try to respond as quickly as possible and usually within 5-7 business days.

It is important for consumers to know what is contained in their credit records and to limit the derogatory information. To this end, the consumer should periodically check their credit record and question any unknown information. This is not to say dispute everything, but investigate and communicate with the data furnishers, whomever they may be, to determine where a problem may exist with the information. Not all data furnishers are collection agencies, some are mortgage lenders, credit card companies, retailers, and utility providers to name the most prevalent. Payment habits of the consumer go a long way in establishing a good credit record and reputation, whereby a lender would be confident in a positive lending decision, and at a reasonable interest rate.

Creditors base their lending decisions on several factors with emphasis on credit history. Does your history show that you pay your debts? And do you pay timely? If so, you will likely be able to obtain credit and at a very favorable interest rate.

Alliance Collection Agency, Inc. is a full service, licensed accounts receivable management and debt collection agency providing highly effective, customized one on one management and recovery solutions for our business partners.  Founded in northern Illinois in 2005, we have been proudly improving the bottom-line on behalf of our business partners in and around Chicagoland for over 10 years.

How to turn $30 into over $700 without trying

Let’s say you’re on your way home from work when you decide to stop at your favorite convenience store to pick up a few needed items, nothing too crazy: diapers, milk, and a few frozen pizzas. When you get to the checkout counter, the girl ringing you up gives you the total, 45 dollars—even. Cool! You whip out your check book, pay, grab your items and are on your way. A few days later you receive a text from your bank informing you of a bounced check for $45.00. The convenience store purchase immediately pops into your head. Oops! You count how many days you have until payday and calculate bills owed. I should be okay, you think and continue on with your life.

Next thing you know you receive a call from the store. On the spot, you tell them to resubmit the check. Then a second notice comes from your bank—it still hasn’t cleared. The problem now is the bank has charged you their non-sufficient funds (NFS) fee—twice—and the money that was going to pay back the store has been spent on those fees. The expletive that comes out of your mouth is no longer oops! Angry over the unfortunate turn of events you realize the store is going to have to wait for their money, but it’s no big deal because how much worse could it get? Short answer: worse, way worse.

Just because the amount you owe seems insignificant doesn’t mean the business won’t go after you. And these small debts can turn into something quite big. Just ask Dr. Christina Johnson-Conley of Lacey Washington. She was in the news a while back when the $30 bounced check she gave her children’s school for lunches turned into over $700 worth of charges that were garnished from her wages.

How can this happen? Let me explain by talking about the bounced $45 check written to your convenience store. Forty-five dollars, no big deal, right? But the thing is, the United States economy is built on the premise that when consumers purchase goods, services or credit, they are expected to repay what they owe. In the case of the bounced check, there is an expectation the check be made good, so much so there are actual bad check laws (statutes) to protect businesses that accept checks.

There are both civil and criminal penalties for this unlawful act. In Wisconsin, where we are, the civil penalties include three times the amount of the check and all actual costs of legal action including attorney fees. The three times penalty is called exemplary or punitive damages which means it’s there to punish the check writer and deter them and others from repeating the offense. It’s there to get your attention—and believe me it will!

So, if you kept ignoring the storekeeper (or the collection agency he sent the bad check to) that $45.00 would likely grow into a sizable debt, just like Johnson-Conley’s check did.

I’ve seen small bad checks turn into large debts quickly because consumers ignore letters and calls from first the establishment they wrote the check to and then the collection agency that received the bad check. I also know of instances where a consumer has asked the agency to cease contact with them—certainly within their rights. And when an agency is asked to stop contact, the law requires them to stop. But here’s the thing, stopping contact does not stop the collection process.

If the debt caused by the bad check continues to go unpaid, the next step in the process may be to call an attorney and when this happens, look out, because this is when your debt is going to grow. This is where those exemplary damages we talked about will come into play. And, since a lawyer is involved—you know how much they charge—their costs will also get added to your bill. Add to it the storekeeper’s bank fees (yes, the storekeeper is charged a fee when a check they try to deposit bounces) and if the establishment has a check policy posted at point-of-sale, those fees are also added. And depending on where you live, a process server might also have to be hired to deliver the summons and complaint which starts the lawsuit. Guess who is going to be paying her fee? Cha ching!

Let’s recap; you’re now being charged for the original 45 dollars check, 135 dollars in exemplary damages, the attorney’s fees at about 300 dollars (or more) per hour, the process server’s cost of about 65 bucks along with bank fees and any fees posted for check bouncing at point-of sale. Boom!

Now they have your attention, you call to settle up. But if you think these extra charges can be negotiated away, think again. Once all that time has lapsed and the legal wheels are in motion, you cannot reset the clock. The money has been spent and there is very little wiggle room for negotiations. And if you wait and end up in court, these numbers will continue to grow as court costs escalate.

Now you’re thinking, seriously?? This won’t happen to me. But the thing is, it could. The initiation of a lawsuit is never done without careful deliberation, but when a consumer is uncooperative, this may be the only viable option for procuring payment. This is why it’s always important to address any debt—no matter how small. Contact whomever you owe and let them know you are having financial difficulties and work out a payment agreement together. The sooner you address the problem, the better it will be for you all, win-win.

Alliance Collection Agency, Inc. is a full service, licensed accounts receivable management and debt collection agency providing highly effective, customized one on one management and recovery solutions for our business partners.  Founded in northern Illinois in 2005, we have been proudly improving the bottom-line on behalf of our business partners in and around Chicagoland for over 10 years.