Correcting Loan Defects with CollectIQ

Correcting Loan Defects with CollectIQ Informed

Auto Lenders dream of the perfect deal jacket – clear proof of consumer income (paystub, bank statements), residence and insurance. And, all the right forms and notices, and required dealer documents.

Unfortunately, in reality loan documentation is not so pristine. Thirty-seven percent of deal jackets have missing documents or other critical defects.

When curing these defects,  lenders often run into bottlenecks. Each communication between the lender, the auto dealer, and the consumer can cause delays. Without automated processing, lenders may take days discovering the defect. Once notified of a defect, dealers don’t have the means to quickly contact the consumer to get the required information.  Meanwhile, consumers often have a hard time sharing a paper document with the lender.

CollectIQ cures defects quickly

CollectIQ is a digital service enabling lenders, dealers, and consumers to share documents and key information simply and securely via their phones. Lenders can instantly notify a dealer of a missing document.  The service enables the dealer to text the consumer with a link and the consumer shares or uploads information using their phones. It’s similar to making mobile bank deposits. Consumers use CollectIQ to upload missing paystubs, signatures, insurance cards, and bank statements to share with their lender.  

CollectIQ is a win-win-win. Lenders get the information they need to fund loans quickly, dealers get paid faster, and consumers get quicker access to their new car.

The view from Compliance Corner

Informed has designed CollectIQ with a close eye on regulator and consumer privacy expectations, while supporting ease of use.

The Federal Communications Commissions (FCC) issued rules under the Telecommunications Protect Act (TCPA) governing how businesses send text messages to consumers. We have designed our technology so lenders and dealers can comfortably follow FCC and applicable state guidelines.

The key compliance consideration in texting is to ensure you have the customer’s consent to text. TCPA rules generally distinguish between texts for marketing and business operations.  Marketing texts require express written consent. Operations texts require prior express consent (do not have to be in writing).  CollectIQ texts, administered by dealers, qualify as a business operation communication. The dealer is not advertising, but communicating with the consumer about a transaction the buyer initiated.

For non-marketing calls, consent can be oral, written, or if the consumer provides a phone number (absent contrary instructions). We find that many dealers can establish consent because they have the consumer’s phone number.

We partner with lenders on TCPA compliance

We work with our partners to ensure they comply with applicable regulations and Wireless Industry Association CTIA guidelines for texting. Including honoring consumer requests to opt out of automated calls and maintaining records of this activity.

We also work with our partners to assure compliance with updated requirements for exempt calls under the TCPA. This limits the number of artificial pre-recorded voice calls to residential landlines within a 30 day period. And, it requires additional opt-out features.

To learn how CollectIQ can improve your lending process, please reach out.

author avatar
Tom Oscherwitz VP of Legal
Tom Oscherwitz is Informed’s VP of Legal and Regulatory Advisor.  He has over 25 years of experience as a senior government regulator (CFPB, U.S. Senate) and as a fintech legal executive working at the intersection of consumer data, analytics, and regulatory policy.

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