The $34 million Missouri Valley Federal Credit Union in St. Peters, Mo., has adopted that approach. The 4,700-member credit union went through a period of strong loan growth last year and started to see a rising tide of delinquency this year, enough to overwhelm Greg Kelleher, the credit union's sole collections employee.

“My title is collections manager, but I'm the only collections staff, too, so I pretty quickly started needing some help,” Kelleher said. He said Missouri Valley considered the cost of hiring and training someone else compared to outsourcing the service and decided go with United Solutions instead.

The United Solutions collector is named Lorraine (the firm does not share its collector's last names for security reasons) and Kelleher said it has become routine for members to say “tell Lorraine I just made a payment” if they run across him in the lobby.

And the credit union's delinquent loans to total loans, which had risen steadily to top out at 1.10 in December 2013, fell in the first quarter of 2014 to 0.63%.

Foote explained the listening approach was key to helping credit union clients have confidence outsourcing such an intimate part of their members' relationships with the credit union to another firm.

“If you think about it, there is a good chance our collections staff knows things about our members other people in their lives don't know,” she said.

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Wendy Elieff, vice president for sales and service for CU Recovery and The Loan Service Center in Wyoming, Minn., agreed that listening to credit union members is a big part of a strong collections effort that both cuts delinquency and strengthens member relationships.

“I agree it is intimate,” Elieff added. “We are helping members resolve problems and means we have to know what the problems are. The members trust us. We aren't just another call center calling them up to harass them about a late bill. We care about where that bill fits into the rest of their financial life and we want to help them overcome their difficulty.”

Foote and Elieff said their firms operate in the guidelines their client credit unions set about catch-up plans, repossessions and other collection strategies and that credit union members often don't realize they aren't talking to a credit union employee.

Elieff said her firm increasingly sees itself as a specialized temporary employment service, providing credit unions with a type of highly specialized employee, often for a few weeks or months.

“Sometimes credit unions hire us to cover a position opened for maternity or other long-term care,” Elieff explained. “Sometimes a credit union might have 20 collection agents but has run out of space, so we provide the additional five they need offsite.”

She said the agents have been trained in most of the different software credit unions use to track delinquencies so can get up to speed with a minimum of training.

Elieff said CU Resources currently is now working to convince more credit unions to hire the firm to chase balances that have been charged off, offering them 50% of whatever the firm manages to recover from their old debts.

“Some of them don't want to hire a third party to chase old debts because they're afraid we might go all Guido on them and adopt harsh tactics, but nothing could be further from the truth,” she said.

“And the fact is, these people want to serve their members. How better to serve your members than you go regain the money you thought lost so you can stay in business in those areas were you are already?” she asked.