Obligation to Pay Collection Agency


I used to work for a collection agency and therefore I know a lot about how they work that many people do not know. Also, I am Jewish and I wonder what a Jew’s obligation is toward paying a collection agency when slapped with a bill from one, considering what I know.

The reality is, if one has a debt that has been sent to a collection agency, making a payment to the agency will hurt one’s credit rating even more than simply ignoring the debt. It is unusual for a collection agency to sue a debtor. After three years, the debtor cannot be sued, and after seven years, the debt cannot cause any further harm to one’s credit.
In other words, it is usually to a debtor’s advantage to simply ignore the debt and the agency’s demands and repeated phone calls. And collection agencies don’t want debtors to know that.

Most people who have a debt sent to collections cannot afford to make payments. The collection agency industry is lucrative between the minute amount of debt that is actually paid by debtors who think they are doing themselves a favor and the sale of the right to collect delinquent accounts between collection agencies.

When a debtor makes a payment to a collection agency, they are not giving money to the original creditor at all. What they do not know has already happened is the original creditor sold their debt to the collection agency for a fraction of its original value and resigned itself to collecting only that amount. From then on, it is in the hands of the collection industry to try to collect on what remains of the balance. The collection industry really exists not to help creditors recoup money they are owed, but it’s a bunch of entrepreneurs exploiting the fact that some people just don’t or can’t pay their bills.



  1. Yours is truly an extremely delicate and sensitive question. I feel that it would be best answered by someone who is an expert (of which I am not) in these kinds of laws and the variations that each case carries with it. Subsequently, I would suggest that you approach a Dayan on a Bet Din that deals with monetary laws and present your question to him.

    Best wishes from the AskTheRabbi.org Team