Understanding Debt Collection in Oregon

Dealing with debt collection can feel overwhelming. You might receive phone calls, letters, or even emails from companies or law firms you've never heard of asking for money. It can be hard to know what's real, what's fair, and what your next steps should be.

This guide is here to help.

It explains what debt collection is, how the process works, and who's involved. Whether you're just starting to deal with debt collection or trying to understand your rights, knowing the basics can help you feel more confident and in control.

The articles in this guide focus on consumer debts—personal, family, or household debts like medical bills, credit cards, and utility bills. It does not cover business debts, tax debts, child support, or other debts owed to the government. For more on what is, and is not, a consumer debt, read this article.

Other topics:

• Unpaid bills: Need help with unpaid bills not in collections? Click here.
• Debt lawsuits: Sued over a debt or have a court judgment? Learn more here.
• Garnishment: Is being taken from your paycheck or your bank account to pay a debt? Read more here.

How debt collection works

Debt collection is the process a business uses to recover money it believes you owe. It typically starts after you miss a payment on a bill, like a credit card or medical bill, or on a loan:

1. The business may contact you directly by letter or phone asking you to pay.
2. If payment isn't made, they might:
   • Hire a debt collection company or law firm, or 
   • Sell your debt to a debt buyer, who then takes over the collection process.
3. Debt collectors may call, send letters, or report the debt to credit agencies. 
4. The debt collector may file a lawsuit, asking a judge to declare that you owe the debt in a court document called a judgment. 
5. If they get a judgment, the debt collector is authorized to try to get money directly from your paycheck or bank account to go toward the debt. 

Your options when dealing with debt collection

Why you might not recognize the debt collector's name:

Debt collectors are usually not the same company you originally borrowed money from. This can make it confusing when someone contacts you about a debt. Debt collectors may be:

• A person or business hired by the company that you first borrowed from or agreed to pay, called the original creditor.
• A law firm or lawyer that focused on debt collection.
• A debt buyer, which is a business that purchases unpaid debts from creditors and tries to collect the money themselves. 

This is why it's important to verify any debt before you agree to pay a debt collector. Understanding who you’re dealing with can help protect you from scams or overpayments.

If you’re unsure about a debt, check out our guide on “What to Do If a Debt Collector Contacts You” for tips making sure a debt is real and that it’s really your debt.