What is the difference between a debt collector and a lawyer?

In New South Wales, as in many jurisdictions, there are distinct differences between a debt collector and a lawyer, particularly in their roles and the services they provide.

Debt Collector:

1. Role: A debt collector is a professional or agency hired by a creditor to recover money owed by individuals or businesses.
2. Methods: Debt collectors use various methods to collect debts, including phone calls, letters, and negotiation. They may attempt to reach a repayment agreement with the debtor.
3. Legal Authority: Debt collectors do not have the same legal authority as lawyers. Their actions are typically limited to non-legal means of debt collection, and they cannot take legal action against debtors on behalf of the creditor.
4. Regulation: Debt collectors are subject to regulations, and there are laws governing their conduct. In Australia, this may include compliance with the Australian Consumer Law, which outlines acceptable practices for debt collection.

Lawyer:

1. Role: A lawyer is a legal professional who is trained and qualified to provide legal advice, represent clients in legal matters, and, if necessary, take legal action on their behalf.
2. Legal Authority: Lawyers have the legal authority to represent clients in legal proceedings, including debt recovery through the court system. They can take legal action, such as filing a lawsuit, on behalf of their clients.
3. Methods: Lawyers can use legal processes, such as issuing a statement of claim, obtaining judgments, and enforcing judgments through court orders.
4. Legal Knowledge: Lawyers have a deep understanding of the law, which allows them to provide legal advice tailored to their clients' specific situations. They can assess the legal merits of a case and provide guidance on the best course of action.

Further, if a debtor refuses to pay or disputes an amount paid, a debt collection agency may have limited options moving forward. A lawyer, should the matter need to progress to litigation can advise on the best options available moving forward.

In summary, while debt collectors focus on non-legal methods of debt recovery and negotiation, lawyers are qualified legal professionals who can provide legal advice, represent clients in legal proceedings, and take legal action to recover debts. If a debt collector is unable to secure payment through negotiation, a lawyer may be engaged to pursue legal avenues to recover the debt, including taking the matter to court.

When trying to recover outstanding debt, choosing the right debt recovery lawyer can mean the difference between a quick, smooth recovery and a long, drawn-out ordeal. Although both outcomes may result in a successful attempt at recovery, the latter is more expensive and therefore not ideal. The team at Kells has the experience and expertise needed to recover your debt in a cost-effective way.