Debt Collector

AAA

DEFINITION of 'Debt Collector'

A company or agency that is in the business of recovering money that is owed on delinquent accounts. Many debt collectors are hired by companies to which money is owed by debtors, operating for a fee or for a percentage of the total amount collected. Some debt collectors are debt buyers; these companies purchase debt at a fraction of its face value and then attempt to recover the full amount of the debt.

INVESTOPEDIA EXPLAINS 'Debt Collector'

Debt collectors are monitored by the Federal Trade Commission (FTC), which enforces the Fair Debt Collection Practices Act (FDCPA). The FDCPA prohibits debt collectors from using abusive, unfair or deceptive practices during the debt collection process. For instance, debt collectors are not allowed to contact debtors before 8:00 AM or after 9:00 PM, nor can they falsely claim that a debtor will be arrested if he or she does not pay.

RELATED TERMS
  1. Delinquency Rate

    The percentage of loans within a loan portfolio that have delinquent ...
  2. Creditor

    An entity (person or institution) that extends credit by giving ...
  3. Collection Agency

    A company hired by lenders to recover funds that are past due ...
  4. Bankruptcy

    A legal proceeding involving a person or business that is unable ...
  5. Debtor

    A company or individual who owes money. If the debt is in the ...
  6. Charge-Off

    A term describing an expense on a company's income statement. ...
RELATED FAQS
  1. What's the average salary of a bill collector?

    According to the U.S. Bureau of Labor Statistics, the average salary of a bill or debt collector in the United States is ... Read Full Answer >>
  2. Are debt collectors allowed to call me at work?

    According to the Federal Trade Commission, a debt collector can contact a debtor at work unless the debtor specifically tells ... Read Full Answer >>
Related Articles
  1. Budgeting

    Negotiating A Debt Settlement

    If you're being harassed by a debt-collection agency, you can take charge. Find out how.
  2. Budgeting

    5 Signs That You're Living Beyond Your Means

    Learn what to watch for before you find yourself drowning in debt or filing for bankruptcy.
  3. Retirement

    Bankruptcy Protection For Your Accounts

    Will the plan assets you've worked hard for be safe if you experience a personal financial crisis?
  4. Personal Finance

    Outfox The Debt Collector's Hounds

    Dealing with a collection agency is scary if you don't know your rights. We help you take back the power.
  5. Credit & Loans

    A Lifeline For Those Drowning In Debt

    Don't wait to be saved, find out where the lifesaving devices are and hang on tight!
  6. Budgeting

    Student Debt: Is Bankruptcy The Answer?

    Student loans can be a huge financial burden, but bankruptcy won't necessarily save you from paying.
  7. Options & Futures

    Bankruptcy Filing Changes That Could Affect You

    When the economy is down, more people file for bankruptcy. Make sure you know about the changes that have been made to this process.
  8. Bonds & Fixed Income

    An Overview Of Corporate Bankruptcy

    If a company files for bankruptcy, stockholders have the most to lose. Find out why.
  9. Savings

    Why Do Credit Cards Expire?

    Credit cards expire for more reasons than you could imagine – including, so you don't forget you have the card.
  10. Credit & Loans

    Meet The Company Behind Your FICO Score

    There are other credit scores that evaluate lending risk, but FICO is still the choice of most U.S. lenders.

You May Also Like

Hot Definitions
  1. DuPont Analysis

    A method of performance measurement that was started by the DuPont Corporation in the 1920s. With this method, assets are ...
  2. Asset Class

    A group of securities that exhibit similar characteristics, behave similarly in the marketplace, and are subject to the same ...
  3. Fiat Money

    Currency that a government has declared to be legal tender, but is not backed by a physical commodity. The value of fiat ...
  4. Interest Rate Risk

    The risk that an investment's value will change due to a change in the absolute level of interest rates, in the spread between ...
  5. Income Effect

    In the context of economic theory, the income effect is the change in an individual's or economy's income and how that change ...
  6. Price-To-Sales Ratio - PSR

    A valuation ratio that compares a company’s stock price to its revenues. The price-to-sales ratio is an indicator of the ...
Trading Center