Debt collection is the process of recovering the debts owed by an individual or
an organization. People are usually hired and they get a particular fee for
crediting the amount by the agency of the whole amount received. Debt
collection is legal and can be done by the first or second party. If the debt
is not paid by the borrower it can lead to legal action taken against them. They
are primarily of three types named Bulk debt collection, overseas debt
collection and private debt collection.
Collectors
The collectors are those who are in charge of collecting the
debt by the borrower. Debt collectors are sole individuals
that move from place to place to collect the money. They are individuals
assigned by the company that the borrower took the debt from or can be assigned
by another agency. First party collectors are those
collectors who belong to the same company where the debt was taken from.
Second-party collectors are those collectors that are assigned from particular
agencies.
Agencies
These days almost every company works on a credit basis and
therefore allows the customers to take products and pay the amount over some
time. Other than this taking and granting loans have also become common.
Therefore this has lead to the establishment of a debt
collection agency. They let companies hire individuals for debt
collection. Every employee in the agency is assigned a few borrowers from whom
they have to collect the debt. The safety of these individuals comes under
company policies. Most of the agencies have the profit amount that they take
after the collection of debt.
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