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CREDITORS AND BILL COLLECTORSTHE TWO TYPES OF CREDITORSThere are two basic types of creditors with whom you will be dealing. They are, "secured creditors" and "unsecured creditors." A SECURED CREDITOR has secured interest in your debt to him. Examples of loans that have security interest are real estate mortgages, car or boat loans, personal loans secured by real property or monies on deposit, or an installment loan or lease agreement that asserts security interest in the item financed. Taxes owed to a governmental agency are an implied secure loan. This is because government agencies may attach or levy your property or wages the same as can a secured lender. Secured creditors have the greatest degree of recourse as they have the right to repossess property or attach pledged monies. AN UNSECURED CREDITOR has no secured interest to guarantee that your debt is repaid. Examples of unsecured loans are credit or charge cards (MasterCard, VISA, American Express, Discover), department store charge accounts, signature loans where no monies or property have been pledged, and oil company credit cards. While they make seek a judgment against you for nonpayment, unsecured creditors have few actions of recourse. THE THREE TYPES OF BILL COLLECTORSCollection activities are done by one of the three main types of bill collectors, a "Primary Bill Collector," "Third-Party Bill Collector," or a "Tax Revenue Collection Officer." THE PRIMARY BILL COLLECTOR is an in-house (accounts receivable department, staff collection specialists, etc.) attempt to collect money. This method is commonly, though not necessarily used in the first 90 days of collection efforts. When these in-house collection efforts fail, debts or accounts, are usually handed over to what is called a Third-Party Bill Collector. A THIRD-PARTY BILL COLLECTOR is either a professional collection agency or a law firm acting as a collection agency. A Third Party Bill Collector may be located in your home town, on the other side of the United States, or somewhere in between. TAX REVENUE COLLECTION OFFICER is an employee of a local, state, or federal agency whose job is to collect delinquent taxes. Their official job titles may vary from agency to agency. They function in much the same way as does a third-party bill collector, except, they are generally armed with more aggressive enforcement tools, such as substantial fines and interest (usually about 25 percent compounding), property levies, and 100 percent penalties. |
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