Debt collection is the process by which a person or entity who is owed money or property seeks payment for the debt. Debt collection may be performed by the person or entity who is owed the debt (the creditor), or may be performed by a third-party debt collector hired by the creditor to collect the debt on behalf of the creditor. Sometimes creditors sell the debt to another entity at a discounted value, and the entity that purchases the debt becomes the creditor.

Debts that are often the subject of debt collection efforts include (1) credit card debt; (2) car or auto loan debt; (3) medical debt; (4) student loan debt; (5) unpaid utility and telephone bills; and (6) personal loan debt.

If you owe money, you have a legal obligation to repay it. But state and federal laws—such as the Fair Debt Collection Practices Act—prohibit debt collectors from using deceptive or abusive tactics to collect the debt.

In Michigan, debt collection is regulated by both state statutes and federal law. The Fair Debt Collection Practices Act (FDCPA) is a federal law that sets national standards for the collection of debts, prohibiting debt collectors from using deceptive, abusive, or unfair practices. This includes harassment, making false statements, and disclosing the debt to unauthorized parties. Michigan's collection laws also provide protections for consumers, including statutes of limitations on how long a creditor has to sue for a debt. For example, the statute of limitations for most debts in Michigan is six years from the date of the last activity. Credit card debt, auto loans, medical bills, student loans, utility bills, and personal loans are all subject to these regulations. If a debt is sold to a third party, the new creditor has the same rights and must follow the same laws as the original creditor. Consumers in Michigan have the right to request validation of the debt and can dispute debts they believe are not owed. It's important for consumers to know their rights and, if necessary, seek guidance from an attorney to navigate issues related to debt collection.