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Debt collection might vary based on the company that’s collecting a debt.

What is debt collection?


Debt collection is when a collection agency or company tries to collect past-due debts from borrowers. You might be contacted by a debt collector if you haven’t made loan or credit card payments and those payments are severely past due.

If you’ve co-signed a loan or you’re an authorized user on a credit card for someone else, you might also be contacted by a debt collection agency looking to get paid for money owed. Those overdue debts can be anything, including:

  • Medical debt

  • Car/auto loan debt

  • Personal loan debt

  • Credit card debt

  • Student loan debt

  • Unpaid utility and phone bills

How does a debt in collections affect your credit?


An unpaid debt in collections can have a major impact on your credit score. If you have a delinquent account, your creditor can report it to credit bureaus, resulting in a drop in your credit score. Collections can stay on your credit report for up to seven years from the first delinquent date. The impacts of this account should lessen with time. After seven years, the account should fall off of your credit report. If it doesn’t, you can file a dispute with the credit bureau in question and have it removed.

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