Debt Collection Agencies

Debt collection agencies are companies that specialize in recovering unpaid debts owed to creditors, such as businesses or lenders. When a debtor fails to pay a bill, the original creditor may hire or sell the debt to a collection agency. These agencies contact the debtor to negotiate repayment, either through payment plans or settlements. They must follow legal regulations to ensure fair treatment, including restrictions on harassment or misleading practices. If debtors fail to resolve their debts, agencies may report to credit bureaus, which can affect the debtor's credit score.