An incassobureau is a third-party debt collector that specializes in recovering unpaid debts. They often have more resources and experience than a small business owner and can help with complex debt cases, including those involving multiple creditors or a large amount of debt. They may also have better knowledge of local consumer laws and how to comply with them.
Creditors will usually try to collect on past-due debts themselves before sending them to a collection agency. However, if it looks like you won’t pay, the original creditor will typically sell or “assign” your debt to the collection agency. The creditor gets a lump sum of money in exchange for the right to collect on your debt. The debt collector becomes the legal owner of your debt and must contact you to try to get you to pay the debt.
Behind the Scenes: Understanding the Role and Impact of Collection Agencies
Debt collection agencies will often be able to negotiate a repayment plan with you. However, it’s important to be aware that your debt may appear on your credit report if it goes into collections. It can affect your credit score and make it harder to obtain new loans and services.
It’s best to work with a collection agency as a last resort. But if you do, research the collection agency’s rates, ability to recover unpaid bills, and their approach with customers. You should also ensure the collection agency is licensed to interact with consumers in your state. To find out, check your state’s online listing or call your Department of Consumer Affairs.