Skip Tracing

Top

Newsletter Sign Up

Home >> Credit & Collections Best Practices Summary

Skip Tracing Overview

Skip tracing is the art of locating a debtor who does not want to be found. It is of primary importance to the collections department, which sometimes faces the task of obtaining payment from individuals who do not pay by the simple expedient of covering their tracks. In this article, we address multiple skip tracing techniques.

Before conducting a skip trace, be sure to make a rational, hard-headed decision regarding whether this is worth your time. A really thorough skip trace can require many hours, so is it worth the effort if the amount owed by the debtor is not large? With this issue in mind, most credit managers will initially authorize only a brief search of easily accessible databases before requiring their personal approval before proceeding further. Part of this initial search should include bankruptcy records, since a recent bankruptcy will likely force the credit manager to cancel any additional skip tracing activities.

If the decision is made to proceed, who should conduct the skip trace? This is something of an art form, and requires a different mindset from that of the collections staff. If there is someone on staff with a natural proclivity toward skip tracing, then consider yourself lucky. If not, it may make sense to outsource this function to a professional skip tracer. However, do not expect to pay a few dollars for a thorough skip trace. Though the Internet is replete with advertisements for skip traces costing $100 or less, such searches are only for perfunctory perusals of a few common databases. For a detailed search, expect to pay a skip tracer on an hourly basis, and set a maximum number of hours for each trace. If you are searching for a judgment debtor, then many states allow you to add collection fees to the principal amount of the judgment, which may make this a more palatable alternative.

Skip Tracing Techniques

If you still wish to conduct in-house skip tracing, then here are some location techniques:

Envelope trace. Send an empty envelope to their latest known address, with "Do Not Forward - Address Correction Requested" stamped on it. The Post Office will return it in about a week with the target's forwarding address.
People search. Use People Search on www.411.com. This on-line database is a simple way to locate anyone by their name who resides in the United States. You can also enter their phone number or email address in the same site, and it will sometimes return an address. The results are spotty, but this is worth a few minutes of your time.
Caller ID. Use caller ID on incoming calls. Sometimes enough inquiries will result in the target calling you, just to see what you want. If so, have caller ID, so you identify them and store their phone number. Then use the Reverse Phone search on www.411.com to determine their address.
Search engine. Conduct a search on a search engine. Though a name search on Google may return thousands of web links, putting the name in quotes and adding a few key words about the target will rapidly reduce the number of relevant links.
Database search. Conduct a search through a paid database service. These sites provide access to records of inmates, births and deaths, marriages, divorces, and reverse phone records. Expect to pay anywhere from $7.50 for a simple record search to $50 for a thorough analysis.
Personal contacts. friends, co-workers, relatives, and neighbors. Though time-consuming, this can be an extremely effective approach. The target usually slips and lets someone know their new address, so persistence pays. An especially effective approach is to contact the former landlord, who may have the target's credit application on file. If so, this may contain all kinds of useful tracing information
Use pretexting. It is allowable in many jurisdictions to make inquiries of friends, co-workers, and so forth, under false pretenses. While this falls into an ethical gray area, people may be more likely to give information, depending upon your story.
Third party search. If the target individual has lived with a third party in the past, then conduct a skip trace on the third party now - your target may be living with that person again.
Other records. If you can obtain copies of a person's job applications, disability applications, utility bills, or criminal background checks, this may also reveal locational information.

Whatever method you use, keep a formal log of your results that includes the target's key personal information that you've accumulated, as well as the results of every type of search listed above. This consolidates your records and ensures that you do not duplicate steps.

Podcast

A discussion of credit best practices is available on Episode 86 of the Accounting Best Practices podcast. Listen Now.