Recently my family sold my childhood homestead in a small town in Utah. Because of my career in financing automobiles, it became my responsibility to liquidate my father's 1973 Toyota FJ-40 Land Cruiser that had been stored in our barn for 20 years. When I asked my mother for the title to the vehicle so I could sell it, I was intrigued with the document she gave me. The document was an installment sales contract that my father had signed when he purchased the vehicle. I was astonished when I reviewed the contract and realized that the APR was disclosed as 13.50%. The prime rate at the time was around 6 % (see federal prime rate history). I knew my father was a good credit risk and had paid his obligations in a timely manner, and I wondered why he paid such a high interest rate. As I thought about what some of the reasons may be for the higher rate, my mind reflected on the use of FICO scores. During the 1980s, when I worked at Zions First National Bank, FICO scores were not available. My experience prior to that time was that many financial institutions charged much higher interest rates for noncommercial consumer borrowers. I believe this was the case with my father on his 1973 Toyota Land Cruiser at the 13.50% rate. As consumers became more aware of FICO scores they began to demand better rates from their lending institutions. Lenders also were generous with rates to their best borrowers. Without a higher interest rate cushion that many financial institutions had previously enjoyed to mediate risk on higher risk consumers, many financial institutions began shying away from consumers with lower FICO scores and derogatory credit histories. This type of environment left many credit challenged borrowers without financing options. Thus, my father's situation. It takes more than just good underwriting to manage a successful subprime lending portfolio. A large part of the success of a subprime portfolio is within the consumer service and collections area. Much of the success in subprime lending comes from changing poor paying habits to on-time and regular payment habits. Collection habits were established early by contacting the borrowers. As a lender, the underwriting department rehearses payment dates and expectations before closing the sale of any contract. Sub-prime borrowers need constant and vigorous collection activity to be successful. In many cases, customer service agents gain a personal rapport with the borrower as he, or she perform early and frequent contacts to collect payments. This is not a kinder, gentler consumer service call. Consumer service agents must be firm and assertive in his or her collection efforts.