Being harassed by a debt collector is never fun, no matter what type of debt you owe or how much. Unfortunately, many people in our economy today are struggling with overwhelming debt, in large part because of how poor our economy has been in the last decade. Whether you have fallen behind on your mortgage payments and are facing a foreclosure or are in over your head with student loans and credit cards, it is not uncommon to feel as if you are drowning in debt. With all this in mind, many people do not realize that there may actually be a way out. From filing for bankruptcy to retaining the services of an experienced debt collection attorney, it is worth looking into your options before throwing in the towel.
With this in mind, it is also important to note that pursuing a claim against a debt collector is an extremely complicated matter that involves time, money, and effort. As we’ve discussed in the past, there are numerous different factors to consider when it comes to understanding the debt collection process. Beyond the points we discussed a few months back, it is also worth addressing the various types of debt collection. Because this is such a sensitive subject, many people do not fully understand their rights or what is involved in a debt collection case.
Let’s now take a look at a few of the most common types of debt collectors:
- Internal Debt Collectors
These types of debt collectors are those who work for the same company in which you owe money to. In some instances, they are referred to as “first-party” collectors. This type of debt collection is quite streamlined for the company pursuing action against you, mainly because they don’t have to involve a third party creditor.
- Third Party Debt Collectors
This is probably the most common and traditional form of debt collection and what most people think of when the term “debt collector” comes to mind. Third party debt collectors are outsourced by the company in which you owe money to in order to help them get their money back. They are usually called in once your account has been “charged off” by the original creditor. This type of debt collector typically works on a fee structure, which is based on what it will take to get you to pay back the creditor.
- Debt Buyers
Debt buyers are often brought in when all other collection types have failed, or when there is a lawsuit for the debt. Debt buying is a complicated business that typically means the debt will pass hands repeatedly, making it difficult for the person in debt to know who owns their debt or who to pay. Another thing to point out with debt collectors is that they normally purchase accounts that are very old, which is one of the reasons why these types of cases get so messy.
In order to avoid a headache and confusing scenario, we encourage you to contact a debt collection attorney at Wormington & Bollinger. We are here to help ensure you have a better understanding of your debt and options, as well as the various types of debt collectors that may come after you. For more information about debt collection in Dallas, contact us today.