Collections and Recovery

Cease communication means a consumer directs a collector to stop most further collection contact.

A collection agency is a business that tries to recover unpaid debt on behalf of a creditor or after buying the debt.

A debt buyer is a company that purchases unpaid debt and then seeks to collect on it.

Debt validation is the process of requiring a collector to provide enough information for the consumer to understand what debt is being claimed.

A deficiency balance is the remaining debt still owed after collateral is taken and sold for less than the amount due.

Garnishment is a process that directs part of a debtor's income or funds toward debt recovery.

A payment arrangement is an agreed plan to repay overdue debt over time instead of all at once.

Recovery rate is the share of a defaulted or charged-off balance that a creditor or collector is able to recover.

Repossession is the lender's recovery of pledged property after serious nonpayment on secured debt.

A settlement offer is a proposal to resolve a debt for less than the full claimed balance.

Third-party collection means debt-collection activity performed by a separate collector rather than the original creditor.

A validation notice is the collector's written notice identifying the debt and explaining the consumer's basic validation-related rights.