Collections Scenarios and Examples
Collections Scenarios and Examples
Below are examples of how the CINC Accounting collections process works.
Example 1
On April 1, Homeowner A is assessed a fee of $100.00 and does not make payment. This leaves a balance of $100.00 on the ledger, aged 0 days.
On May 1, the $100.00 fee from April 1 is now aged 29 days. Also, on May 1, Homeowner A is assessed a fee of $100.00 and makes a payment of $100.00.
The $100.00 payment is applied to the April 1 assessment. The total outstanding balance is now $100.00, but the aging is 0 days.
Even though Homeowner A meets the balance requirement to move to the first collections level, they do not meet the aging requirements because the payments are always made within the aging.
Example 2
On April 1, Homeowner B is assessed a fee of $100.00 and does not make payment. This leaves a balance of $100.00 on the ledger, aged 0 days.
On May 1, the $100.00 fee from April 1 is now aged 29 days. Also, on May 1, Homeowner B is assessed a fee of $100.00.
On May 3, Homeowner B is escalated to Collections Level 1 because both the outstanding balance and the aging meet the requirements set in the collection’s setup.
On May 4, Homeowner B makes a payment of $100.00. The $100.00 payment is applied to the April 1 assessment. The total outstanding balance is now $100.00, and the aging is 3 days.
Homeowner B meets the balance requirement, but the aging was reset by the payment made on May 4, so they are no longer in collections.
Example 3
On April 1, Homeowner C is assessed a fee of $100.00 and does not make payment. This leaves a balance of $100.00 on the ledger, aged 0 days.
On May 1, the $100.00 fee from April 1 is now aged 29 days. Also, on May 1, Homeowner C is assessed a fee of $100.00.
On May 3, Homeowner C is escalated to Collections Level 1 because both the outstanding balance and the aging meet the requirements set in the collection’s setup.
On June 1, Homeowner C is assessed a fee of $100.00, bringing the total outstanding balance to $300.00, and the total aging to 60 days.
Homeowner C will continue to progress through the collections levels if they do not make a payment.
If Homeowner C makes a payment, it will apply to the oldest assessment. If the aging of the next assessment is still within the aging requirements for the collection’s setup, the homeowner will remain in collections.
NOTE: Each assessment has its own aging and will age separately. The homeowner will not move to the next collections level until their youngest outstanding assessment has reached the aging minimum in the collection’s setup.