Full Definition of Debtor and Creditor Law

The focus of debtor-creditor law involves circumstances where a person or group is unable to pay a monetary debt to another party. States regulate debtor-creditor law in a non-bankruptcy context through state statutory and common law. The federal government has passed the Fair Debt Collection Practices Act to regulate activities of some debt collectors.

Non-bankruptcy debtor-creditor law is governed mainly by state statutory and common law. Harrassment, defamation, or other unfair practices in attempts at debt collection may be curbed by tort claims in state court. States also regulate debt collection through statute. Congress has enacted the Fair Debt Collection Practices Act to regulate some debt collectors.

Creditors use judicial and statutory processes to have debts satisfied. Attachment is a limited statutory remedy whereby a creditor has the property of a debtor seized to satisfy a debt. Garnishment allows a creditor to collect part of a debt (for example wages) to satisfy the obligation. Replevin allows a creditor to seize goods, such as a security interest, that he or she has a property interest in, to satisfy the debt. Receivership involves the appointing of a third party by a court to dispose of the debtor's property in order to satisfy the debt.