What is debt collection & how does it work?

Debt collection happens when another company or debt collection agency tries to get you to pay the money you owe. If you’re behind on payments for several months, your debt may be sold to a collection agency that will contact you to arrange payment. Dealing with debt collectors can be stressful and embarrassing, but it’s common.

What is a collection in finance?

In finance, "collections" refers to the process of recovering money owed. It's like a financial cleanup crew, making sure everyone pays their debts. Collections can involve various strategies, from friendly reminders to more serious actions if someone repeatedly avoids paying what they owe. Think of collections as the financial enforcer.

What are my rights under the Fair Debt Collection Practices Act (FDCPA)?

Educate yourself about your rights under the Fair Debt Collection Practices Act (FDCPA). This federal law regulates how creditors and debt collectors can interact with you regarding debt collection. When you know your rights, you can protect yourself from unfair or abusive practices. For example, the collector is not allowed to: