What can debt collectors do?
Many consumers are not sure about where exactly debt collectors fit in, especially within the legal system. In order to help you understand their role in the system, he are some of the things a debt collector can do.
- No matter what threats or harassment a collector may put on you, if they are attempting to collect an unsecured loan then they are fairly limited in their legal abilities to recoup the money.
- If a debt is secured however, collectors can take steps to take back your collateral- whether it be a car or other assets- in order to pay off your debt.
- Debt collectors have commission based pay, so small amounts may be shrugged off by them rather than fight for repayment. At this stage though, you would just be further damaging your own credit record.
- They will chase down large debts with relentless vigor. They can and will sue you to recover large debts. They will serve you with a summons that will inform you of all the details of your court appearance.
- If the collector wins the case, your assets cannot be taken immediately, but only once the court has agreed on and given permissions to the collector. The collector can, for example, ask the court to garnish your salary, withholding a certain amount of your salary to be paid into your debt.
- The collectors, once having seized assets, can sell them at a public auction with the proceeds being applied to your outstanding debt.
- The debt collector can but a judgment lien on one of your assets- this means you cannot sell or borrow against the same asset before you have paid off your outstanding debt.