Life does not always go as planned and for a variety of reasons people could find they are facing financial difficulties resulting in the inability to pay off some debts. While this alone is a stressful situation, when debt collectors begin to call to try to recover what is owed, it can be even harder to deal with. In many of these situations, the collector making those attempts is a debt buyer. But just what does that term mean?
Debt buyers are third parties that purchase the accounts of debtors from creditors such as credit cards companies or banks, and then try themselves to recoup the debt. In such a purchase, the debt buyer will generally receive an electronic file containing very little information regarding the debt. The information that may be there includes the name of the debtor, an account number and the amount of the debt. Because the purchase is generally made for a small fraction of what is owed, it may be easy for a debt buyer to make a profit.
Sometimes, debt buyers that purchase debt then turn around and resell it. This process can result in a debtor facing contact from multiple debt collectors, sometimes even after they have settled the debt.
Regardless of how a collector comes to be in possession of a debt, there are certain guidelines all debt collectors are supposed to adhere to. Debtors should be aware that when they don’t, it may be possible to take legal action against the collector. A consumer protection lawyer can be of assistance with this.