If you owe creditors, then you may expect to hear from collection agencies. However, there are cases where a creditor may hire a collection attorney to help settle the debt. If you hear from a debt collection attorney, you may not be sure what to do next. Many people don’t realize that collection attorneys exist before they call. Here are a few reasons why creditors may choose to use a collection attorney instead of a collection agency.
Creditors may use debt collection attorneys as a form of intimidation against debtors. People attach more authority to lawyers than they do to debt collectors. If a lawyer contacts you, you may worry more about the legal consequences of debt. You are more likely to pay quickly. You should not allow it to intimidate you, however. You have all of the same rights as a debtor when dealing with a lawyer that you do when you’re talking to a collection agency.
Usually, when a creditor hires a debt collection attorney, it is because he or she wants a lawyer’s expertise on the matter. An experienced lawyer is more than just a representation in front of the judge or someone who knows subpoenas. A lawyer is someone who knows how to locate hidden bank accounts, assets, corporate interrelationships and more.
When creditors hire a debt collection agency, it costs them a lot of money. There is no guarantee that the agency will manage to collect the debt. The creditor could wind up waiting a long time to receive any money and will have to pay more in the meantime. If the agency does fail, the agency will have to talk to a debt collection attorney.
Sometimes, the creditor will want to cut out the middleman. Instead of the wait time, they can go straight to the debt collection attorney and ask for help. In the long run, this is a more cost-effective option. Creditors don’t have to worry about the fees associated with collection agencies.
If your creditor contacted a debt collection lawyer, you need to find representation of your own as soon as possible. Usually, when a creditor chooses a lawyer, he or she does not want to wait much longer to receive the money. Likewise, these creditors are more likely to file a lawsuit against you.