Collection Agencies

What are Collection Agencies?

When you are having financial troubles, you will very likely be put in a position at some point where you have to deal with a collection agency. These debt collection enterprises earn their money by basically coaxing debtors into paying back past due loans to the creditors. You will end up having a collection agency contacing you if and when a pst due debt you have is ulitmately passed to third party collection by the original creditor. This third party would be the collection agency and it is their job to make you pay back the creditor. The agencies earn a percentage of the amount of money that they are able to collect on behalf of the credit grantor. There are also some instances when the collector has actually bought out the debt from the original creditor (often for pennies on the dollar) and is now entitled to the full amount of money they can collect back under the particular debt contract. In both cases, since the collection agency earns either a percentage of or the full amount of the monies paid back by the debtor, they will be relentless in pushing to have the debtor cought up the money.

Are Collection Agencies regulated?

Collection agencies are regulated in the USA and most western countries. These collection agency laws govern what rights the collection agencies have and what they can and cannot do in order to carry on their business. Statutes for these laws can be found under the FDCPA law at the federal level in the United States. There are also similar laws at the state level in most states. In Canada the collection agencies are regulated at the provinical level and you should direct yourself to the provinicial legislators for more information. In the event that collector is in violation of any of these laws, you do have the right to report the collection agency under these statutes.

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