A consumer may not know the difference between a debt buyer and a debt collector. And the fact is that they are completely different. The consumers can benefit by knowing the difference. While debt buyers have been around for a while, over the last decade they have become much more prevalent in consumers dealing with bad debt.

Debt buyers serve as intermediaries in the debt collection process, purchasing outstanding debts from creditors and working with collection agencies to recover the funds. They focus solely on debt acquisition and tracking, leaving the actual collection efforts to the collection agencies.

However, there are some debt buying companies who also have set up debt collection companies, mostly they remain separate from each other, in which case the debt buyer will contract with a debt collection agency and place accounts with them to work on the basis of contingency.

Once a debt buyer attempts to collect on their own purchased debt, they become a debt collector. They are held to the strict legal and regulatory standards that apply to debt collectors.

Being a legitimate debt collector is not an easy task in today’s environment and requires strict adherence to the law. Debt collectors are required to be fully licensed, insured and fully bounded. This is the reason why most debt buyers outsource their accounts to a debt collection agency.

So, for a consumer its extremely important to understand the difference between a debt buyer and a debt collector.

In conclusion: Debt buyers and debt collectors are two different things, but many consumers don't know the difference. 

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