The Problem Of Debt Collection

2307 WordsApr 27, 201510 Pages
With the current economic crisis one of the major issues that most consumers are facing is the problem of debts that they have incurred due to many reasons. As I started to do my research on the practices that companies use to collect debts, I discovered that there are so many different types of debts and different companies handle their collections of each debt differently. This topic discusses the practices of debt collection. There are many laws that cover the process of debt collections; most major companies outsource their debt by selling it to these companies. However, there are federal regulations that must be followed when collecting debt. There are so many factors and process involved in collections of debt. There are many different types of debt however normally they first have to fall into two particular categories called “unsecured” and “secured debts”. A debt can be secured or unsecured. Unsecured debts are normally credit cards or other debts that consumers did not agree to have the creditors to sell any property of yours, if you are unable not pay it off. An example of secured debts would be mortgages. These are debts that give the creditors the right to sell property if the consumers cannot pay off the debts. The main types of debt are: car loans, student loans, credit cards, and mortgages and medical debts. Each of these types of debts comes with their own advantages and disadvantages. To most people Credit cards are a convenient method of
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