Ensuring a Successful Sale of Performing and Nonperforming Accounts Receivables Speakers: Mark Naiman, Board President, Receivables Management Association Jan Stieger, Executive Director, Receivables Management Association

Making the Decision to Sell Your Debt Evaluate Options In-house collections Third-party collections Law firms Sales Ways to Sell Your Accounts in the Default Process Portfolio sales Forward flow agreements Pooled or “league” selling

Valuing the Portfolio of Debt Appropriate data to estimate the value Asset type Borrower type Characteristics of debt, including: Age of debt Account balance Principal Interest/fees Forgiveness Other Collection efforts thus far Account integrity Quality of documentation Accuracy of balances Detailed payment history Each buyer has their own evaluation process, and Certified Buyers can help educate Sellers on many state-specific requirements.

Preparing Your Portfolio for Sale Selecting the accounts for sale Bankruptcies Judgments Accounts with good documentation Okay to sell deceased or bankruptcy debt, but need to identify as such What not to sell Accounts you have issued a 1099 on Disputes – need to disclose

Selecting Debt Buyers to Bid Working with Certified debt buyers to minimize risk Best practices and industry standards Size and reputation of company Company’s expertise in the asset type or location of the consumers

Creating an RFP Information that needs to be included on an RFP in order to obtain bids from potential buyers Nondisclosure agreement Resale, especially to state or specialty buyers Bankruptcy accounts Formal RFI process substantiating the P&P’s and validation of acceptable levels of Data Security and Compliance. Importance of data security in the purchase and sale bidding process

Purchase and Sale Agreement What needs to be in a purchase/sale agreement Representative and Warranty Clauses Guidance on work standards Guidance on legal strategy Guidance on post-sale communication Requirements Correspondence Exchange Training Payments Regular Audits

After-Sale Communications with Purchaser Direct pays Documentation Put backs Open communication is probably the most important factor in maintaining risk-averse and consumer-friendly reputation.

How the CFPB/OCC has changed the process Minimizes reputational risk Vendor management What happens to your accounts after sale Resale—to Certified companies Insuring data security Post-sale support (media/direct payments/correspondence) Clarity, guidance and recommendations surrounding customer experience and protection.

Interactive Q&A Discussion Complimentary Originating Creditor Membership: Receivables Management Association (RMA) offers complimentary membership to creditors (application is required). Membership in the association provides access to other members, timely communication on regulatory changes and trends in the industry, online and in-person education and discounts to RMA conferences and education. Visit: www.dbainternational.org Thank You!