A debt collector is a professional who recovers money owed to creditors by debtors who haven't paid. That's the simple definition. The useful definition is more specific: a debt collector is someone with the local knowledge, communication skills, and legal capability to apply structured pressure in the debtor's jurisdiction — pressure that the creditor can't apply from their own country.
For overseas businesses with unpaid invoices from Spanish companies, understanding what a debt collector does (and doesn't do) helps you evaluate whether professional collection is worth engaging and how to choose the right one.
What Debt Collectors Do
Investigate the debtor. Before investing effort, a competent collector assesses whether the debt is collectible. For Spanish debtors, this means checking the Registro Mercantil (commercial registry) for filed accounts and registered charges, ASNEF and RAI debtor registries for existing defaults, and obtaining commercial credit reports. This assessment takes 24–48 hours and tells you whether the debtor has the means to pay, which determines the collection strategy.
Contact the debtor directly. Phone calls, formal written demands, field visits to the debtor's business premises. For Spanish debts, this happens in Spanish, from Spain, by someone who understands Spanish commercial payment culture. The collector establishes professional management of the case, sets clear payment deadlines, and applies escalating pressure through structured follow-up.
Negotiate payment. Most commercial debts don't require legal proceedings — they require skilled negotiation. The collector negotiates full payment, structured payment plans, or settlements based on the debtor's capacity and the economics of the case. A good collector maximises recovery while maintaining realistic expectations about what the debtor can actually pay.
Escalate to legal proceedings. When amicable collection fails, the collector (or the collector's legal team) files court proceedings. In Spain, this typically means the monitorio payment order for documented debts or civil proceedings for contested claims. The collector manages the legal process through their in-house attorneys or formal law firm partnerships.
Execute enforcement. After obtaining a court judgment, the collector initiates enforcement: bank account garnishment, asset seizure, receivables seizure, and property charges. This requires identifying the debtor's assets through local investigative capability.
What Debt Collectors Don't Do
Guarantee outcomes. No legitimate collector guarantees recovery of a specific amount or percentage. Recovery depends on debtor solvency, documentation quality, and case complexity — factors that are assessed, not guaranteed. A collector who promises specific results before reviewing your case is selling, not assessing.
Use aggression as a method. Professional commercial collection is firm, structured, and legally grounded. It's not aggressive, threatening, or harassing. The goal is recovering money, not antagonising the debtor into prolonged resistance. Effective collectors apply pressure through competence and legal capability, not through intimidation.
Replace your legal team. Collectors are not lawyers (though many agencies employ them). For complex legal disputes, specialist litigation counsel may be needed. What collectors provide is the structured collection process that resolves most debts before legal complexity becomes relevant.
Types of Debt Collectors
Collection agencies. Companies that specialise in recovering debts on behalf of creditors. They handle the amicable phase (phone calls, demands, field visits) and typically have arrangements with law firms for legal escalation. Some agencies have in-house legal teams that handle the full spectrum. For commercial debts, agencies based in the debtor's country are most effective.
Debt recovery lawyers. Attorneys who specialise in debt recovery litigation. They handle court proceedings, enforcement, and complex legal matters. They typically don't handle amicable collection (their hourly rates make routine phone calls uneconomical). Most effective when engaged through an agency that manages the amicable phase and transitions to legal when needed. Spanish debt recovery lawyers detailed here.
Integrated providers. Agencies that combine collection capability with in-house legal teams. Collection professionals handle the amicable phase; in-house attorneys handle legal escalation and enforcement. Same team, same file, seamless transition. This is the optimal structure for commercial debt recovery.
How Debt Collectors Are Paid
Contingency (no-win, no-fee). Standard for amicable commercial collection. The collector charges a commission (5–15%) only on money actually recovered. If they don't recover anything, you pay nothing. This model aligns the collector's interests with yours and eliminates the financial barrier to engaging professional help. No-win, no-fee details here.
Fixed fees for legal services. Court filings, attorney representation, and enforcement actions typically involve fixed costs separate from the contingency commission. These costs should be clearly discussed and agreed before legal proceedings begin. Cost breakdown here.
How to Choose a Debt Collector for Spanish Debts
Physical presence in Spain. B2B commercial specialisation. Integrated legal capability. Transparent fee structure. Verifiable recovery data. These five criteria determine whether the collector can actually recover your money. Everything else — website quality, marketing claims, technology features — is secondary. Detailed selection criteria here.
FAQ
Is hiring a debt collector worth it?
For commercial debts above €10,000 on no-win, no-fee terms: yes, almost always. The cost is zero upfront, and the expected net recovery (even after commission) dramatically exceeds the alternative of writing off the debt. For debts below €10,000, a standalone attorney demand (€300–€500) can be cost-effective without full agency engagement.
Will a debt collector damage my relationship with the client?
Professional commercial collection is firm but not destructive. Many debtor relationships survive professional collection — the debtor pays, the matter is resolved, and business continues. What damages relationships more reliably is months of frustrated internal correspondence, unpaid invoices, and deteriorating trust. Engaging a professional actually resolves the underlying problem that's damaging the relationship.
How long does the process take?
Amicable resolution: 30–90 days. Pre-legal + amicable: 60–120 days. Legal proceedings: additional 30–45 days for uncontested monitorio, 6–18 months for contested claims. Most commercially viable debts resolve in the amicable phase. Early engagement produces the fastest outcomes.
Alan Perez
💥 World citizen / 🛵 Tourist, Senior Debt Collection Manager, Business Debt Claims Expert
