Debt Collection Terminology

Accounts receivable - A businesses transaction or series of business transactions that manage the billing of customers who owe money.
 
Bad debt - In business, this is a fiscal amount of receivables that is considered unrecoverable.

Bankrupt - A legally declared inability to pay creditors.
 
Collection agency - Business that charges a fee to collect debt from another company or organization's debtors.

Creditor - Party that claims another party owes it some form of capital or property.
 
Debtor - An individual or company that owes money to a creditor.
 
Dunning letter - A series of accounts receivable letters, which escalate in gravity, detailing the attempts made to collect on an unpaid debt. Often times the use of such letters serve as a legal requirement for a debt collector when they attempt debt collection.
 
FDCPA - Federal Debt Collection Protections Act. This is the primary US law governing the practice of debt collection.

First party - Refers to an entity that is a subsidiary of the original creditor in a two party contract.
 
Third party - An entity that was not one of the two original parties obligated by a two party contract. Often times, this is an independent debt collector.

Skiptracing - A debt collection method that a collection agency uses to locate an individual that has changed locations without satisfying their debt.