A collection agency, also known as a debt collector, is a business or other entity that specializes in debt collection, i.e. pursues payments of debts owed by individuals or businesses.
Debt refers to something that is owed or due either physically or metaphorically.
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Most collection agencies operate as agents of creditors and collect debts for a fee or percentage of the total amount owed.
A creditor is a party that has a claim on the services of a second party.
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Third-party agencies are separate companies contracted by a company to collect debts on their behalf for a fee.
Debt buyers purchase the debt at a percentage of its value, then attempt to collect it.
A debt buyer is a company, sometimes a collection agency, a private debt collection law firm, or a private investor that purchases delinquent or charged-off debts from a creditor or lender for a fraction of the face value of the debt based on the potential collectibility of the accounts.