A Collection Agency is an organization that has the sole purpose of pursuing payment on debts for its clients. Debt collection is a process in which creditors seek the payment of their outstanding debts from their clients. The purpose of a collection agency is to collect a debt from a creditor. This type of organization is also known as a “debt collector” or “debt collectors”. But what exactly are they?
A collection agency can buy your debt from your creditor and attempt to collect all or part of it. According to a recent Federal Trade Commission survey, collection agencies pay an average of $4 per dollar for a debt. The next step is to sell your debt to another collection agency. This process has created a controversy about the accuracy of information contained in debt records. After all, it is not uncommon for an agency to re-sell a debt to a different company for a higher profit.
In the U.S., many collection agencies are members of the Association of Creditors Attorneys (ACA). This association requires its members to adhere to a code of ethics and standards of conduct. The standards of conduct require member agencies to treat their clients with dignity and to appoint an officer with authority to handle complaints from consumers. If a consumer decides to hire a collection agency, the ACA has a program to help consumers resolve disputes with debt collectors. Click here for more information about collection agency information.
The ACA International trade association regulates many U.S. collection agencies. Members must follow the code of ethics, which requires them to treat consumers with respect and dignity. It also has a consumer complaint resolution program where consumers can file a complaint and the agency will attempt to resolve the dispute. So, if a creditor chooses to work with a collection agency that is ACA member, there is little chance of a creditor refusing to pay.
Some collection agencies are regulated by the ACA International. They must adhere to a code of ethics and standards of conduct and are bound by the law when collecting funds. They also must report to credit bureaus when a default is reported to them. They may also be required to appoint a consumer complaint officer. Ultimately, it is up to the consumer to make a decision based on the guidelines of the ACA.
The chances of a collection agency pursuing a debt are important for both parties. If a debtor is likely to settle a debt with the agency, the chances of collecting money are higher. Otherwise, a creditor will hire a Collection Agency that is not a member of ACA. However, it is important to make sure a Creditor Reviews.com review of a Creditor’s Practices. If a Collection Agency has a history of poor customer service, the agency will do so before finalizing a decision.