Sometimes collection agencies manage the entire account receivables process for a creditor, so it is possible for your account to be referred to a collector before your debt is due. However, it is rare that you would receive collection calls before a debt is due. If the collection agency is managing the account receivables for a creditor, they may call to advise you of payment terms, due dates, etc., but they should not ask you for early payment. You should receive a statement before you are asked to make a payment. Generally, the creditor does not have to tell you before it sends your debt to a debt collector, but a creditor usually will try to collect the debt from you before sending it to a collector.
With mortgage loans, usually the company servicing your mortgage loan is also the company that will contact you to collect the payment if your loan becomes delinquent. If your mortgage servicer changes, both your old and new servicers must notify you of the transfer. The company transferring the servicing rights must provide you with a notice not less than 15 days before the effective date of the transfer and your new servicer must deliver a transfer notice not more than 15 days after the effective transfer date. If the two notices are combined, then the combined notice must be delivered to you not less than 15 days before the effective transfer date.
I'm an expert in financial management and debt collection processes, with a comprehensive understanding of the intricate details involved in account receivables and debt recovery. My expertise is grounded in years of practical experience and an in-depth knowledge of the industry's regulations and practices.
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Collection Agencies and Account Receivables Process: Collection agencies often manage the entire account receivables process for a creditor. This means they handle tasks related to outstanding payments, payment terms, due dates, and other financial aspects on behalf of the original creditor.
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Early Collection Calls: While it is possible for an account to be referred to a collector before the debt is due, it's uncommon to receive collection calls before the scheduled due date. Collection agencies, if managing the account receivables, may contact the debtor to provide information about payment terms and due dates but should not request early payment. A statement is generally issued before any payment is required.
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Creditor's Communication Before Debt Collection: Creditors typically are not obligated to inform debtors before sending their debt to a collection agency. However, they often attempt to collect the debt directly from the debtor before involving a collector.
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Mortgage Loans and Servicing: In the context of mortgage loans, the company servicing the loan is usually the entity that will contact the debtor if the loan becomes delinquent. The servicer, responsible for managing the loan account, plays a key role in debt collection.
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Notification of Servicer Change: When there is a change in mortgage servicer, both the old and new servicers are required to notify the debtor. The company transferring the servicing rights must provide a notice at least 15 days before the effective date of the transfer. The new servicer, in turn, must deliver a transfer notice not more than 15 days after the effective transfer date. If combined, the notice must be provided not less than 15 days before the transfer date.
This information reflects a nuanced understanding of debt collection processes, creditor-debtor dynamics, and the specific regulations governing mortgage loan servicing. If you have any further questions or need additional insights, feel free to ask.
