What and who is Teletrack? We try to answer this question in detail in this post.

Payday loan applicants and borrowers often search for cash advance companies that don’t use Teletrack services in attempt to get approval (usually online) for short-term, non-conventional financing.

If for some reason the applicant has past credit issues, a low FICO score, recent bankruptcy, or poor employment records, they are not likely to be approved for a loan by a payday loan provider.

In some cases these applicants are honest consumers who are simply in a bad financial stage of their life. In some case the applicant is up to no good and is trying to trick, or defraud the Payday lender. The reasons for their predicament can vary so greatly we won’t list them here.

Regardless of the scenario taking place during the application process, the Payday Loan lender has to protect their business. Most non-conventional lenders now use Teletrack products to protect themselves from delinquent borrowers.

The smart payday loan lenders use all of the different Teletrack products described in this installment. Some only use 1 or 2 of the Teletrack products depending on many factors – factors such their location, their clientele base, their past delinquency rates, and their lending criteria.

So here we go. My basic understanding of Who and What is Teletrack.

Who and What is Teletrack

Teletrack was founded in 1989 (very recent in business-to-business financial services terms) and their primary business is tracking consumer credit history for lenders who need fast data on their prospective borrowers (or clients if you prefer). The company provides fast reports to sub-prime auto loan companies, payday loan (cash advance) providers, rent-to-own businesses, and the like.

Teletrack is owned by the First Advantage Corporation (see references below) which is a risk mitigation company that is traded publicly on the NASDAQ (their stock market locator is FADV)

Teletrack complies with the FCRA as a consumer reporting agency.

Teletrack Services

They have various different reporting products and these are listed and described below:

• Risk Assessment
• Credit Scoring and Auto-Decision Databases
• Fraud Detection
• Identity Verification
• Skip Tracing

Teletrack Risk Assessment

• Past Applications for Loans – Information about the applicants past requests for funding, loans, or advances from non-conventional financial institutions.
• SocialGuard® Check – Tells the sub-prime lender if the applicant’s produced Social Security # belongs to someone who is already dead, and/or whether or the not the SSA (Social Security Administration) actually even registered the SSN.
• Bankruptcy History – Tracks and sees if the applicant is lying on their application form about claiming bankruptcy in the last 7 years.
• Landlord Court Filing Records – meaning they collect court records from Landlord Actions which involve collections on past rent due, damage to rental property and/or leasing agreement violations. They can see if you’ve been late on rent, skipped on rent, trashed the place, etc. If you have done (or not done) any of the above, and the landlord never went to court to recoup damages then you should be clear on this issue.
• Loan Opening and Closing Information – Gives the lender any data on the applicant’s past loans. How many loans they currently have active, how many they’ve closed, and how many they’ve recently opened.
• Charge-Off History – tells the lender if the applicant has recently used some form of non-conventional funding and been completely delinquent.
• Charge-Off Repayment – simply a way to tell if the borrower eventually follows through and repays all  monies that were owed before the Charge Off.

Credit Scoring and Auto-Decision Databases

Most payday loan lenders use both of these Teletrack products (detailed below) so they can track the applicant’s behavioral history of borrowing. By using Cyberscore™ and DecisionManager™ in conjunction lender(s) can track the applicant’s application history online or at bricks and mortar (store-front) payday loan businesses.

CyberScore™ – Cyberscore is another database Teletrack uses to track borrowers and their credit histories. This database was developed by Scoring Solutions™ (see references below) and it tracks the online applications and loan inquiries made by an applicant. This type of reporting system is vital for online payday loan lenders and cash advance providers.

Cyberscore also provides loan information for online applications made by a lender for vehicles and credit cards. Almost all lenders who do business online use Cyberscore now.

DecisionManager™ – Auto-Decision database management system that is a trademarked product of Teletrack’s. This system allows payday and cash advance lenders a way to check an applicant’s histories and make an automatic split-decision on whether or not to approve the paycheck advance.

This “decisioning” database can be customized to whatever the specific lender’s criteria is for approving payday loans. They can “set it” so that they can be very conservative in their day-to-day lending practices, or very risky – depending on their lending model(s).

The lender(s) can use such markers as the applicants employment record, yearly and monthly earnings, record of payment frequency and amounts, and their overall credit score.

Teletrack Fraud Detection

Fraud detection is key for payday loan providers because there are borrowers who make a short career out of defrauding cash advance companies. They do what is know as “skipping”.

These loan skippers borrow money from multiple payday loan companies (and other lenders) via similar pretenses using invalid SSNs. These SSNs are usually associated with deceased people or people who have recently been issued an SSN. They also use SSNs they steal from valid citizens (AKA – identity theft)

Teletrack uses two tracking products in conjunction which are listed and described below.

SkipGuard© - alerts lenders of applicants that have taken out similar loans with different lenders. Skipguard also tracks if a consumer has been renting products at multiple places with the intent of committing fraud.

SocialGuard® Check – We already listed this product above which tracks Social Security Numbers to make sure they are valid.

Teletrack Identity Verification

Teletrack’s identity verification system performs checks and balances for an applicant’s information, cross referencing their SSN, home phone number, street address, place of employment, job description, age, sexual orientation, etc.

Teletrack compares all of the above listed data with all on-record loans, lines of credit, past credit and loan applications etc. The identity verification system gives a “confidence score” which is used by the lender to make decisions on whether or not to lend money to an applicant.

Simply another form of fraud protection really.

Teletrack Skip Tracing

Teletrack’s skip tracing system is also an anti-fraud tool designed to weed out payday loan “skippers”, who gather payday loans with the sole intention for never paying back a cent of the advance. I describe these perpetrators above under heading of Teletrack Fraud Detection.

Their skip tracing product primarily tracks the addresses of borrowers and applicants using their PEOPLELOCATION™ system. Because non-conventional borrowers tend to be fairly nomadic, it’s critical to track their residencies and nationwide locations. This is how skip-borrowers are caught in their effort to defraud payday loan companies.

All data in the Teletrack PEOPLELOCATION™ system is updated daily (actually it is almost real-time now) so payday lenders can try and circumvent loan skipping.

Teletrack Bankruptcy Check System

Teletrack also provides a database (system) that tracks all court records for consumers and borrowers that have filed for bankruptcy protection.

This tracking product pulls data from the courts and can see when and where an applicant filed for Chapter 7 and/or Chapter 13 bankruptcy.

In Conclusion

Why Payday Lenders Have Sleazy Reputations

Teletrack is used by the vast majority of Payday and Cash Advance lenders who operate in Canada, The United Kingdom, and the United States.

Payday loan companies are often given “bad raps” for taking advantage of borrowers who have bad credit or unstable personal finances. These non-conventional lenders (or sub-prime lenders) usually charge extremely high delinquency fees and higher than normal loan servicing fees.

They also lend with high APR agreements which can often financially cripple an individual who finds themselves caught up in a vicious month-to-month cycle costing them a large portion of their monthly or bi-weekly income.

In Defense of Payday Lenders

As you can see by reading about all of the services provided by Teletrack – payday lenders are victims of sleazy tactics by borrowers who attempt defraud them, go delinquent on their loan, use false information, etc.

Payday loan providers do perform a service for consumers who are in an extraordinary situation whereby they need an advance on their paycheck in times of financial distress. If the borrower is honest and “on the ball” they will rarely (maybe once or twice in their life time) use a payday lender and always pay back the loan on time – not suffering any of late payment fees.

I personally spoke with a couple than runs a Payday loan company and they were overwhelmed with borrowers skipping and defaulting on loans. They were honest people providing a legal financial service, albeit that their business relies on the misfortune of others. If the government stopped companies doing business based on that criteria there would be an economic crash on a gargantuan level (law offices and hospitals….just to name a couple of business models).

These lenders just need to be regulated so the unscrupulous payday loan providers cannot charge fees and APRs that may financially cripple a borrower.

Teletrack References For This Article

• Teletrack – sells banks and lending companies with “actionable intelligence” so they make good choices on who they lend to.
• First Advantage Corporation – risk mitigation and credit data solutions.
• Scoring Solutions Inc. ™ – Scoring Solutions of Atlanta, GA developed the Cyberscore System that Teletrack uses as part of their arsenal of reporting and lending data tracking .