collections litigation

Collections litigation refers to a legal process where a creditor seeks to recover unpaid debts through courts. If a borrower defaults or fails to pay what they owe, the creditor may file a lawsuit to obtain a judgment against them. This judgment can then be used to enforce collection efforts, such as garnishing wages or seizing assets. Collections litigation ensures that creditors have a formal legal option to recover owed funds when informal attempts have been unsuccessful. It involves court procedures and may result in a legal obligation for the debtor to pay the debt.