LAWDOG Fair Debt Collection Practices Act

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Person Who Extends Credit Creating Debt or To Whom Debt Is Owed

Under the Fair Debt Collection Practices Act, the term "creditor" means any person who offers or extends credit creating a debt or to whom a debt is owed, but such term does not include any person to the extent that he receives an assignment or transfer of a debt in default solely for the purpose of facilitating collection of such debt for another.

See Section 803 (4) of the Fair Debt Collection Practices Act, and a portion of the FTC Commentary On the Fair Debt Collection Practices Act reproduced below for illustration purposes only.

Section 803(4) defines "creditor" as "any person who offers or extends credit creating a debt or to whom a debt is owed". However, the definition excludes a party who "receives an assignment or transfer of a debt in default solely for the purpose of facilitating collection of such debt for another."

1. General. The definition includes the party that actually extended credit or became the obligee on an account in the normal course of business, and excludes a party that was assigned a delinquent debt only for collection purposes.

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A Portion of Section 803.......
Definitions

As used in this subchapter--...

(4) The term "creditor" means any person who offers or extends credit creating a debt or to whom a debt is owed, but such term does not include any person to the extent that he receives an assignment or transfer of a debt in default solely for the purpose of facilitating collection of such debt for another.

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A copy of the Fair Debt Collection Practices Act is reproduced for illustration purposes only here. A copy the FTC Official Staff Commentary on the Fair Debt Collection Practices Act is reproduced for illustration purposes only here, and a portion is below. Read Sources and Disclaimer. Links do not return to this page. Use browser "back" button to return.

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