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LSDefine
Simple English definitions for legal terms
debt collector
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A quick definition of debt collector:
Term: Debt Collector
Definition: A debt collector is a business that tries to collect money that someone owes to another person or company. They use things like the internet, phones, and mail to contact the person who owes the money. Sometimes, the company that is owed money will use a different name to make it seem like someone else is trying to collect the debt. However, people who work for the company that is owed money are not considered debt collectors under the law.
A more thorough explanation:
A debt collector is a business whose main purpose is to collect debts on behalf of third parties using the U.S. mails or an instrumentality of interstate commerce. This can include creditors who use a different name during the debt collection process to make it seem like a third party is collecting the debt.
However, under the Fair Debt Collections Practices Act (FDCPA), officers or employees of a creditor or those affiliated with the creditor by common ownership or corporate control are not considered debt collectors.
- A collection agency hired by a credit card company to collect overdue payments is a debt collector.
- A law firm hired by a landlord to collect unpaid rent is a debt collector.
- A bank that is trying to collect a debt using its own name is not considered a debt collector under the FDCPA.
The examples illustrate that a debt collector is a third-party business hired to collect debts on behalf of another party. The first two examples show businesses that fit the definition of a debt collector, while the third example shows a business that is not considered a debt collector under the FDCPA because it is the original creditor trying to collect the debt using its own name.