Differences Between A Debt Collection Lawyer And Collection Agency

A debt collection lawyer and a debt collection agent perform a somewhat similar function; they both pursue the collection of unpaid debt. Although the end goal is the same there are differences in the way they go about it. If you are looking at an account which seems beyond your ability to collect, you need to know which approach is best for your situation.

The size of the debt and fee structure:

A collection agency will take on small debts, many debt collection lawyers establish a lower limit of the work they take; perhaps one to two thousand dollars.

A debt collection agency charge the creditor a fee, the fee is based on the amount of the debt. If the agency fails to collect the debt and they in turn it over to a Las Vegas debt collection lawyer the fee goes up, in this way both the agency and the law firm get income.

A debt collection lawyer usually has a set fee which is in most instances lower than the agency. The creditor will be charged legal fees on top of the fee but these are normally added to the judgment.

Possible action:

The big difference between debt collection lawyers and debt collection agencies is the fact that the lawyer can take the case to court when and if necessary, a collection agent cannot. To collect, the agency must pursue active collection actions such as phone calls and letters.

A lawyer on the other hand can file a case in court. Hopefully the debt will be cleared once a suit is lodged but if not the lawyer can take further action again including garnishing the debtor’s wages, putting a lien on available unencumbered property or even forcing the debtor into bankruptcy.

A Las Vegas debt collection lawyer can normally collect the unpaid debt quicker as an agency often has to involve a law firm anyway. Many people understand the limitations imposed on a collection agency but rarely will they turn their back on a collection demand from a lawyer.

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