A debt collection agency is a company that attempts to collect delinquent debts from individuals or businesses, either on behalf of the original creditor or on its own. Debt collectors are subject to federal and state laws on what they are allowed to do and not do.
Key Takeaways
- Debt collection agencies are businesses that creditors can hire to recover delinquent debts they have been unable to collect through their own efforts.
- Debt collectors may also purchase debt from the original creditor and attempt to collect it for their own benefit .
- Some collection agencies will negotiate settlements with debtors for less than the full amount owed.
- Debt collection agencies and debt collectors are subject to federal and state laws aimed at preventing abusive practices.
