collection agency- An entity retained by a creditor to collect a debt.
credit counseling- Providing a debtor with advice about preparing a budget and paying debts.
credit rating- The conclusion a creditor makes about a debtor's credit-worthiness, based primarily on a consumer credit report.
creditor- A person or company to whom a debt is owed.
debt- A money obligation owed to another.
debtor- Someone who owes money to another.
discharge- The legal release of the obligation to pay a debt. In bankruptcy, a debtor receives a discharge and is therefore freed of the obligation to repay most debts.
judgment-proof- A debtor who has only exempt property or no property, so that a creditor will be unable to collect a judgment against him or her.
judgment-proof- A debtor who has only exempt property, so that a creditor will be unable to collect a judgment against him or her.
property- All of a debtor's possessions, including the right to receive money from someone in the future.
renegotiation- A voluntary modification of an existing agreement - perhaps to reduce monthly payments and to extend the repayment period, or to pay a smaller lump sum now in settlement of a larger sum claimed by the creditor.
repossession- A secured creditor taking possession of the collateral when the debtor defaults.
unsecured debt - Any debt that is not secured by collateral.
wage garnishment - A manner of debt collection whereby the sheriff takes up to 25% of a debtor's paycheck and forwards it to a creditor who has a court judgment against the debtor.
secured debt- A promise to allow a creditor to take a specified item of property if the debt is not paid.
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