Can a debt collector or collection agency use the same processes of collection as a creditor?

The Fair Debt Collection Practices Act generally applies to debt collectors and collection agencies as opposed to the original creditor. Collection agencies and third party debt collectors usually have more resources and time to pursue an unpaid debt than the original creditor. In fact, they have the same methods of collection at their disposal as the original creditor.

The original creditor usually sends reminders to the debtor, then hires a collection agency and if the agency can not collect the debt, the creditor can file a lawsuit. Consumers are widely recognizing illegal phone collection methods and the government responded by creating the Fair Debt Collection Practices Act, which governs the conduct of collection agencies and debt collectors.

In fact, lawsuits against collection agencies for violating the Fair Debt Collection Practices Act are on the rise in the bad economy and increasingly abusive collection tactics being employed to get debtors to pay. Any creditor and collection agency should be mindful of this law and make sure all employees are in compliance with it.

Collection agencies and debt collectors are in the business of collecting debts from people who have not paid. They have more experience in this area and could get a debtor's unpaid debt listed in a credit report, hire legal counsel to handle the lawsuit on behalf of the creditor and simply offer reassurance to a creditor seeking payment.

A creditor should make sure to look carefully at the debt collection company's overall reputation in the industry.