CARM-Pro™ Collection and Asset Recovery Manager – Professional™ software by IBS, Inc. uses desktop and browser-based technology to streamline collection compliance, lower costs and grow income for financial institutions.
More than 1,200 Banks & Credit Unions have licensed CARM-Pro™ Proven Collection Compliance Software by IBS
Now more than ever, banks and credit unions face complex debt collection compliance challenges.
Increasing federal and state regulations often conflict with each other, and insurance firm policies and investor and guarantor collection requirements have become much more complex, robust and stringent.
Collection compliance – combined is historically a rare banking term; however, it has evolved to represent a critical process that directly affects the financial health of all financial institutions.
The vital impact of collection compliance on net income for banks and credit unions has raised it from a lower-level, back-room function to a highly-visible operation.
How Automated Debt Collection Achieves Collection Compliance
As proven by more than 1,200 banks and credit unions that have licensed CARM-Pro™ by IBS, automated debt collection technology increases production, boosts revenue, and improves collection compliance.
CARM-Pro™ Collection and Asset Recovery Manager – Professional is the most widely-used dedicated software for bank and credit union debt collections management.
It automates the operations and tasks of debt collection and special asset recovery, to solve challenges that affect your institution’s financial performance.
Challenges including loan payment delinquencies, debt charge-offs and the growing complexity of state and federal collection compliance.
CARM-Pro™ is a powerful debt collections system that improves collectors’ performance by enabling them to configure and leverage workflows to improve debtor-outreach.
Automated touches include mailed letters and recorded voice, email, and SMS messages that encourage faster and more consistent loan repayment.
Customized & Automated Debtor Communications Enable Your Bank or Credit Union To:
- Gain faster payment by proactively reminding reoccurring debtors of approaching due dates
- Enhance and expand communication touches to hold debtors consistently accountable
- Maintain goodwill with customized messages that represent your brand’s tone & values
- Reduce delinquencies, resulting in lower Allocations for Loan and Lease Losses (ALLL) and CECL
- Reduce impact on net income and recover more money, due to less charged-off debt and additional time spent on recoveries, as staff resources free up due to automated debtor communication
CARM-Pro™ is Reliable Debt Collection Compliance Technology
CARM-Pro’s fully-customizable workflows and automated debt collection software reduces errors, increases collection compliance, and improves productivity for everyone at your bank or credit union.
How CARM-Pro™ Debt Collection Compliance Technology Benefits Everyone at Your Bank or Credit Union
- Executive-level Managers (CEOs, CFOs, etc.) gain on-demand access to key performance metrics
- Debt Collections Management & Staff gain time for less tedious, more revenue-generating duties
- IT Staff gain reliable support & proven software that is compatible with widely used and contemporary system requirements and fully integrates with all core servicing systems
- Bank Debtors & Credit Union Member Borrowers gain clear & consistent prompts to repay loans
Prevent situations where insurance is void or an investor or guarantee position is compromised due to collection missteps, as robust CARM-Pro™ technology can document the essential communication steps taken (often fully automated), to avoid fines and prevent further loss of asset protection.
How CARM-Pro™ Enables Financial Institutions to Increase Productivity & Profitability
- Maximizes non-interest income growth
- Optimizes recovery income
- Improves collection compliance
- Systematically tracks all debt types and stages
- Streamlines charged-off special asset account-level income & expense tracking
- Increases collector productivity and account capacity while reducing FTEs
- Simplifies vendor management
- Customizes & automates collector workflows & borrower outreach
- Simplifies reporting of key metrics to enable strategic planning
- Scales collections efforts with organizational growth
- Streamlines access to critical metrics for strategic business planning
CARM-Pro Helps Boost Net Income & Reduce Delinquencies for Banks & Credit Unions
Financial institutions can leverage powerful CARM-Pro™ technology to deliver more frequent and aggressive touches to delinquent customers, and gain these five vital benefits:
- Increase Net Income by Reducing Delinquencies – Fewer delinquencies enable decreased Allocations for Loan and Lease Losses (ALLL) or Current Expected Credit Losses (CECL).
- Increase Net Income by Preventing Some Charge-offs – Fewer charge-offs enable less draw down on your loan loss reserves (ALLL or CECL).
- Save Collection Costs by Enhancing Collector Productivity – CARM-Pro™ has doubled productivity for hundreds of clients with previously labor-intensive collections environments. For example, if you currently employ 10 collectors to pursue accounts, CARM-Pro™ will empower them with customized workflows, automated touches and streamlined reporting that enables them to work approximately twice the number of accounts as before using CARM-Pro™
- Reduce Expenses by Reassigning Collectors – Enhanced productivity allows you to repurpose your team, cut collection costs in half, and reduce your expenses.
- Generate Revenue by Working Previously Charged-off Accounts – Enhanced productivity frees up your collectors’ time to work charged-off accounts that are no longer on the books from a profit & loss perspective. Re-engaging with borrowers and negotiating new payment increments improves net income and represents enormous impact to net income.
CECL metrics and CARM-Pro™ both drive off from your core banking system, and work synergistically.
CARM-Pro™ receives a daily summary of the portfolio maintained in your core system, and enables your collections staff to leverage technology to maintain collections compliance and reduce Current Expected Credit Losses (CECL).
CARM-Pro™ Enables Financial Institutions to Leverage Technology for Collections Compliance and to Reduce CECL.
Your collections team will gain confidence and be more productive when they can define call-parameters for debtor communications within CARM-Pro, knowing that it will complete and document all necessary debtor calls while also providing a means for debtors to interact with them.
You gain a complete set of accurate collection records, all ready for your next collection audit.
- Rule-based letters complement voice messages to ensure all written correspondence is accurately completed and documented within the required timeframe
- Electronic copies are recorded in your institution’s imaging system
Leveraging technology strengthens compliance and frees your staff from mundane task to focus on debt collection negotiations and charged-off debt recoveries, to grow income without adding fees in tight lending conditions.
Avoid Penalties & Complete all Debt Collection Compliance Steps with CARM-Pro™
- Avoid penalties for missing collection steps
- Ensure that your assets are protected
- Reduce your outstanding past-due portfolio
- Prevent some charged-off accounts while reducing your ALLL
- Stabilize and grow your institution’s net income
Configure CARM-Pro™ to Serve as Your Debt Collection Compliance Guide
Several entities put forth policies and regulations related to collection compliance.
This obliges bank and credit union managers and directors to conduct regular policy review meetings to interpret the regulations and define policies to maintain compliance in the best interest of their institution, clients and members.
Your financial institution must define clear policies and outline what your collectors must do to comply with regulations.
CARM-Pro™ enables your collectors to perform and enforce all actions you’ve defined (often entirely automated), based on your policies.
Your collectors can use CARM-Pro™ to configure workflows to serve as a debt collection compliance guide.
Workflows define and sequence all the collector actions and steps that must happen on certain dates, such as communicating with debtors via phone, email, SMS, and letters.
It is common for banks and credit unions to sell mortgage loans to the federal government.
Freddie Mac and Fannie Mae are home mortgage agencies created by Congress to purchase and guarantee mortgages through the secondary home loan market.
These agencies require banks to service the loans by accruing interest, taking payments, etc.
When an account becomes past due, Freddie Mac and Fannie Mae also require financial institutions to comply with specific required steps to collect on the delinquent loan, or they will reserve the right not to reimburse a financial institution for charged-off loan balances.
For example, Fannie May or Freddie Mac will only reimburse your bank or credit union for a deficiency balance on a foreclosed mortgage if you submit documentation as evidence that you completed all the required steps to collect the balance within a specified time frame.
If your financial institution cannot provide this evidence, then the government will claim a violation of contract, and you will not be reimbursed for the deficient funds.
Frequently Asked Questions About Collection Compliance
CARM-Pro™ Collections and Asset Recovery Manager-Professional™ is powerful banking software by IBS. It ensures collection compliance by enabling collectors to productively configure workflows, customize debtor communications and automate debtor outreach (often performed with no human intervention). This reduces the risk of missing steps in the collections process, and improves net income by lowering collection costs, reducing delinquencies, and preventing some charge-offs.
CECL (Current Expected Credit Losses) represents an accounting standard that will replace the current Allowance for Loan and Lease Losses (ALLL) standard. It is a new accounting model in which lenders evaluate their historic and current losses at different levels of loan types. This enables banks and credit unions to predict future losses and to calculate what to set aside today, by loan type, to cover future losses. CECL helps financial institutions to estimate future credit losses and decide how much to set aside based on what was historically lost based on various account types. Unlike ALLL, CECL obligates lenders to estimate at origination for expected credit losses over the life of each loan.
CECL was finalized in 2016 by the Financial Accounting Standards Board (FASB). Many banks and some credit unions have already implemented CECL, as the CECL compliance deadline for banks and nonprofit companies was originally 2022, but the FASB has changed it to 2023. The CECL compliance deadline for credit unions and most smaller reporting companies has also been pushed out to January 2023.