The In-House Collection Conduct SOP

Purpose

This procedure governs how anyone at the shop contacts a residential customer about money they owe us, so that every past-due account is pursued firmly and nothing said or done in the pursuit becomes the customer's complaint against us. Without it, conduct is set by whoever is most frustrated that week: the eleventh call in four days, the voicemail telling a teenager what the family owes, a lien threat on an account with no lien rights left.

The legal frame, briefly. The federal Fair Debt Collection Practices Act (FDCPA), 15 USC 1692 and following, and the CFPB's Regulation F, 12 CFR Part 1006, generally reach third-party debt collectors, not a creditor collecting its own debts in its own name. That exemption is narrower than it sounds: a creditor that collects under a name suggesting a third party is involved becomes a debt collector under 1692a(6). And the state layer often reaches creditors directly. California's Rosenthal Fair Debt Collection Practices Act, Civil Code 1788 and following, applies to a business collecting its own consumer debts and imports most of the FDCPA's conduct rules; Massachusetts has attorney general regulations that reach creditors and limit call frequency more tightly than the federal rule; other states have their own. State unfair and deceptive practices laws apply to every shop regardless. So this SOP adopts the federal conduct rules as the shop's floor whether or not they bind us, and the numbers below are those rules turned into procedure. This is not legal advice.

Scope

Covers every contact about a past-due balance on a residential customer's account: calls, voicemails, texts, letters, emails, and anything a technician says about the balance at the door. Applies from the day an invoice is past its due date until the account is paid, settled, written off or handed to an outside agency.

Does not cover: commercial accounts (the same courtesy applies but the state consumer rules mostly do not); the decision to file a lien or sue, which belongs to the owner and the shop's lien and small-claims procedures (see related: Mechanics Liens + Collections for Service Business); reporting to a credit bureau, which this shop does not do (see related: Credit Reporting a Customer and the Furnisher Duties); and the script for a collections call, which lives in How to Run a Past-Due Collections Call. Text messages also fall under the TCPA consent rules owned by the shop's texting procedure.

Roles and responsibilities

Procedure

1. Confirm the debt before anyone asks for it. Pull the invoice, every payment and credit against it, and the job record. The balance must reconcile to the invoice total minus payments and credits to the cent, the work must be marked complete, and there must be no open complaint, callback or warranty ticket on the job. Wrong looks like a balance that does not tie out, a deposit applied to the wrong invoice, or a callback still pending: collection does not start, and the account goes to the service manager or the bookkeeper until it is fixed. Asking a customer for money they do not owe is the single fastest route to a deceptive-practices complaint. Hazard: none physical at this step; it is a desk check.

2. Check the account's flags and the customer's state. Read the account for four flags: a bankruptcy notice, an attorney representing the customer, a deceased account holder, and a cease-contact request. Then note the state of the service address, since that state's collection law governs. Acceptance is all four flags checked and the state recorded in the contact log header. A bankruptcy notice stops everything at once, because the automatic stay at 11 USC 362 bars collection, and the account goes to the owner and the attorney. An attorney on the account means we communicate with the attorney only. A cease-contact request means letters only, and only to state what the shop will do next. Hazard: none physical; desk check.

3. Count the contact attempts before every call. Before dialing, read the contact log for this account. The shop's limit is no more than 3 call attempts in any rolling 7 days per account, no more than 1 per day, and none in the 7 days after we actually speak with the customer unless they asked for a callback. That sits well inside Regulation F's presumption at 1006.14(b), which treats more than 7 calls in 7 days, or a call within 7 days of a conversation, as harassing for a debt collector. Calls go only between 8 a.m. and 9 p.m. in the customer's time zone, the FDCPA's convenient-hours window at 1692c(a)(1). Wrong looks like a fourth attempt in the window because a second staffer also called: do not dial, log the deferral, and set the next permitted date. Hazard: none physical; desk task.

4. Speak about the debt only to the customer. If anyone else answers, ask for the customer by name, say you are calling from the shop, and say nothing about a balance, an invoice or a past-due account. Voicemails use the approved script word for word: name, shop name, callback number, and "please call me back about your account." The customer's spouse may be told the details if the spouse is a party to the invoice; nobody else, including adult children, roommates and employers. Acceptance is the log entry recording who was reached and that the script was used. Wrong looks like a voicemail that names an amount: log it, tell the office manager, and do not repeat it. Third-party disclosure is prohibited for collectors at 1692c(b) and is a privacy complaint for anyone. If the customer says they cannot take calls at work, stop calling the work number. Hazard: none physical.

5. Say only what is true and what we will actually do. State the amount, the invoice date, what the shop can accept, and the next step the shop has already decided on. Never threaten an action the owner has not approved or that is not legally available: no lien if the lien deadline has passed or the work did not create lien rights, no lawsuit unless the owner has decided to file, no credit reporting because this shop does not report, and never imply that an attorney or agency is involved when one is not. Acceptance is that every consequence mentioned on the call appears in the account's approved next-step field. Wrong looks like a staffer who says "we'll send it to collections Friday" with nothing approved: correct it in writing to the customer within 1 business day. False threats are deceptive under 1692e for collectors and under state law for us. Hazard: an angry customer is a verbal hazard, not a physical one, at this step; end the call politely if they become abusive and log it.

6. Stop and route any dispute. If the customer says the amount is wrong or the work was faulty, stop asking for the disputed portion on that call. Log the dispute in the customer's words, tell them who will contact them and by when, and route it: amount disputes to the bookkeeper, workmanship disputes to the service manager, both within 2 business days. Collection on an undisputed portion may continue. Acceptance is a dated dispute entry and a written response to the customer within 10 business days. Wrong looks like a staffer arguing the workmanship on the phone: end that part of the call and route it. Continuing to demand a disputed amount is how a collection call becomes a regulator letter. Hazard: none physical.

7. Set any payment arrangement in writing, and keep the field out of it. An arrangement is no more than 4 installments, no fee and no change in the balance, confirmed in writing to the customer within 2 business days. Anything longer or with a fee needs the owner, because it may be consumer credit. A technician may accept a payment the customer offers at a booked visit and hand over a receipt, but never raises the balance unprompted, never visits to collect, and never refuses to do booked work over an unrelated old balance without the owner's decision recorded beforehand. Acceptance is the signed or emailed arrangement in the account. Hazard: at a doorstep, an argument about money is a personal safety risk to the tech; if a customer becomes hostile, the tech leaves the property, calls the office from the truck and does not return that day.

8. Escalate on a fixed clock. At 90 days past due with three written notices sent at roughly 30, 60 and 85 days, the office manager hands the account to the owner. The owner decides one of four: small claims, a lien if rights and deadlines remain, placement with a licensed outside collection agency, or write-off. Acceptance is the decision and its date in the account. Wrong looks like an account at 120 days still being called by the office: stop calling and escalate. An outside agency is a debt collector under the FDCPA and must be licensed where your state requires it; check that license before placement. Hazard: none physical; owner decision at a desk.

The record this produces

Each past-due account carries a contact log with a header (state of service address, the four flags from step 2, the approved next step) and one line per attempt: date, time in the customer's zone, staffer, channel, who was reached, script used, and outcome. Disputes, arrangements and escalation decisions are dated entries in the same log. The office manager reads it before every contact. The owner reads it at escalation. Later it is what the shop hands its attorney or a regulator, and the only proof of how the account was worked. Retain it at least as long as your state's limitation period for consumer claims.

Worked pass

Account: a water heater replacement invoiced on day 0, due on day 15, unpaid. Service address in a state whose law reaches creditors.

• Step 1. Invoice total ties to the job, one deposit of about a third applied, balance reconciles to the cent. Job marked complete, no callbacks. Pass.
• Step 2. No bankruptcy, no attorney, not deceased, no cease request. State recorded. Pass.
• Step 3, day 22. Log shows 0 attempts. Call at 10:15 a.m. customer time, no answer, scripted voicemail. Attempt 1 of 3 in the window. Pass.
• Step 3, day 24. A second staffer called on day 23 at 6:40 p.m. and logged it. A third attempt on day 24 at 9:30 a.m. would be attempt 3 of 3 in the window. Permitted. Called, no answer. Pass.
• Step 3, day 26. The office manager prepares to call again. Log shows 3 attempts in the rolling 7 days from day 20 through day 26. Fail. Stop rule taken: no call, deferral logged, next permitted attempt day 29, when the window runs day 23 through day 29 and day 22 has dropped out of it, leaving 2 attempts. A letter goes out instead on day 26.
• Step 4, day 29. Attempt 3 of 3 in the new window. Customer answers, identity confirmed before the balance is mentioned. Pass.
• Step 6. Customer says the new unit's relief valve has dripped since install. Dispute logged in her words, routed to the service manager that day. Collection paused on the whole balance because the complaint goes to the work itself.
• Step 6, day 33. Service manager's tech finds the expansion tank was never charged to the house pressure; corrected at no charge. Written response sent day 34, inside the 10 business days.
• Step 7, day 34. Customer asks to split the remaining balance. Three equal payments, no fee, same balance, confirmed by email day 35. Paid in full by day 92. Step 8 never triggered.

References

• Fair Debt Collection Practices Act, 15 USC 1692 and following (debt collector definition at 1692a(6), convenient hours at 1692c(a)(1), third parties at 1692c(b), false representations at 1692e)
• Regulation F, 12 CFR Part 1006 (call frequency presumption at 1006.14(b))
• California Rosenthal Fair Debt Collection Practices Act, Civil Code 1788 and following
• Bankruptcy Code automatic stay, 11 USC 362
• See related: How to Run a Past-Due Collections Call; In-House Payment Plans and When They Become Credit