What exactly is debt recovery?

Debt recovery (skolu išieškojimas) is the act of accumulating an outstanding debt from the debtor. A debtor can either be a person or a business. Usually, debt collection is executed by a business or a recovery agency to which the debt is owed. What generally happens is that if a company is unable to collect the debt on their own, then they will turn it over to an agency offering such services.

A first party recovery agency is the one that is basically a subsidiary of the company to which the debt is owed. The company has a recovery branch to maintain the cordial terms of the business relationship that they have with their customers. When a business runs a debt collection branch, they will usually get involved in the defaulting process much before and will try to work on a solution or a compromise, so that they get their money and maintain their client.

A third party recovery agency is a collection company that has nothing to do with the actual contract between the debtor and the company to which they own the money. The third party recovery agency is generally hired on a consignment basis, for a percentage of the debt owed as a small fee. Before you get permission to live in Lithuania (Leidimas gyventi Lietuvoje), you should have proper information of all these services to keep yourself safe.

Recovery is vital to businesses that would otherwise lose out to millions every year through defaults. Though a business may not recover every penny they are owed by using a recovery agency or legal services (teisines paslaugos), they are at least assured of getting back some money. The only interesting part to recovery is to know when to cut down your losses and pass on an overdue account to the debt collection company. 

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