Can a debt collector file a lien?

In order to get a judgment lien on your house, a debt collector must first obtain a judgment against you in court. If the judgment goes unpaid, the collector can then ask to garnish your wages, levy your bank account, or place a lien on your property.

What does filing a lien do?

When someone has a lien, they hold a legal claim against a piece of property. Liens are important because they can prevent property owners from borrowing against or selling their property. In certain cases, lienholders can even file for foreclosure and sell the underlying property to recoup their money.

Can a debt collection agency file a Mechanic’s Lien?

Hiring a debt collection agency is another way to avoid the time and expense of engaging in formal legal processes by filing a mechanic’s lien. Debt collections agencies specialize in recovering debts and can put the pressure on your client without you having to take legal action.

What happens if I hire a collection agency?

Percentage of Collected Debt: If you hire a collection agency, they might agree to retain 30% of the debt collected, which means if they are only able to recover 60% of your debt, 30% goes to them.

Can a collection agency Sue you for a debt?

In some cases, debts that have become time-barred may still be listed on your credit report. In others, debts that are no longer on your credit report may still be legally enforceable. If a collection agency sues you for a debt, it’s in your best interest to talk to an attorney who can help you weigh your options and defend you in court.

What’s the fee for a debt collection agency?

For instance, on a $100 debt, the collection agency fee of 30% means they get $30 even if they only collect $60. Buy the debt: If the collection agency buys the debt from you, they will probably buy it at a very low cost. Example: If you are owed $30,000 from a client, the debt collection agency may buy it for as low as $10,000.