Find out what debt collection terminology means

Acknowledgement of debt

The acknowledgement and admission of an existing debt. This presupposes that the parties agree on the contractual obligations and want to avoid a lawsuit about the situation.



Via a transfer, a creditor may hand over an outstanding debt to another party. The creditor thereby transfers the outstanding claims to EOS. From this point on, EOS is responsible for the collection of the debt.

An effective legal transfer requires a corresponding agreement between the assignor (the assigning party) and the new creditor.



Distraint means that public authorities can seize items and benefits to cover

a creditor’s financial claims. Distraint gives the creditors the right to sell off assets to

cover the amounts owed.


Distraint can be carried out for assets of a particular financial value. Distraint cannot be carried out for

assets that are essential for maintaining a modest home and a modest standard of living for

the debtor and his household.


Distraint is carried out via the submission of petition in this regard to the bailiffs Court





A creditor has claims against one or more debtors/borrowers. If, for example, you have received clothing from a mail-order company that you have not yet paid for, this company is your creditor.


Purchasing receivables

Purchasing receivables occurs when the creditor sells its receivables, including all rights and obligations, to a debt collection company. Purchasing receivables refers to a default (a debt that has not been recovered despite reminder letters and has not already been paid). This means that the original creditor no longer needs to worry about getting its debt recovered, and that together, we can work to find appropriate solutions that are suitable for your circumstances.


Payment arrangement

A payment arrangement is an extra-legal approach where a debtor offers its creditor(s) a payment arrangement agreement (a plan for the settlement of the debt).


Deferment (extension)

A deferment means that a debtor gets an extension from the creditor for the payment of the debt.



When a company or private person is considered insolvent, they are no longer fulfilling their financial obligations with their lender, bank, creditors or mortgage loan institution when the debt becomes due and payable.
Insolvency can lead to insolvency proceedings, in which legal action will be taken against the insolvent party and the assets of the party can be liquidated to pay outstanding debts.


Insolvency declaration

It is the bailiffs Court that has the authority to declare individuals/companies in Denmark insolvent. Such an insolvency declaration means that the person does not have anything of value that the creditors can seize under distraint.
A ‘protection’ of the insolvent party is hereby achieved for six months, which means that the insolvent party cannot be brought before the bailiffs Court during this period.
The protection has certain exceptions, however. The protection applies as a starting point for all unsecured creditors, such as banks, private companies and the like.


The Collection law

The law relating to Debt Collection Activities, colloquially called the Collection law, is originally from 14 May 1997.

The Collection law clarified legislative concepts and frameworks in the area of debt collection.

The Collection law applies to companies that conduct debt collection activities on behalf of others. The Collection law sets out, among other things, that companies that are approved as debt collection companies must comply with ‘good debt collection behavior’. Good debt collection behavior indicate that the company must not expose anyone to unfair pressure, damage or inconvenience.

In connection with the Collection law, EOS in Denmark has a licence issued by the Danish National Police.

Debt arrangement scheme

A debt arrangement scheme is an agreement to pay a liability in instalments over a given period. We can fix these repayments to match your individual circumstances and make sure that they are realistic.


Non-performing receivables

Non-performing receivables are amounts owed that have not yet been collected, despite reminders, and for which an agreement has not yet been reached.


Order for payment

An order for payment is a document that the creditors may file at the bailiffs Court when they want to launch simplified debt collection proceedings against a debtor.

The simplified debt collection process was introduced on 1 January 2005; it is a legal procedure that both private individuals and businesses can use to recover debts via the bailiffs Court.

The simplified debt collection process has the advantage that only one request needs to be made to the court, namely the filing of the order for payment to the Enforcement and Small Claims Court. Previously, the creditors first had to go to a civil court to obtain a judgment against the debtor, after which the creditor had to make a request to the bailiffs Court to enforce the judgment.

When the bailiffs Court receives an order for payment and the corresponding bailiff’s fee, the order for payment is sent to the debtor for service of process. If the debtor does not respond within 14 days of the service of process, the bailiffs Court endorses the order, whereby it will have the same binding effect as a judgment would. Thereafter, the case continues only in the Enforcement and Small Claims Court, in that the debtor is summoned to an official meeting of the bailiffs Court where a distraint can be made as security for the claim and a payment agreement, or a debt arrangement scheme can be entered into.

If the debtor objects to the order for payment within 14 days, or asks for reopening within four weeks following the date the order for payment received endorsement, the case is transferred to the civil court and is subsequently dealt with as an ordinary legal proceeding, in which the demand for payment is regarded as a complaint and summons.

An order for payment included cases where the original claim consists of amounts up to DKK 50,000. However, after a revision to the Administration of Justice Act, as of 1 October 2011 the maximum amount was increased to DKK 100,000. The limit relates only to the claim’s original amount and consequently not to any interest accruing, reminder fees or debt collection costs.

The simplified debt collection process can only be used on claims where the debtor is not expected to object to the claim. In a ruling of 10 August 2011, the Østre Landsret (the Eastern High Court in Denmark) confirmed that an order for payment shall be rejected by the bailiffs Court if the bailiff becomes aware that an objection has been raised to the claim before the order for payment is submitted to the court.

The main claim

The main claim corresponds to the payment that the debtor owes a creditor as a result of an obligation (e.g. a contract). The main claim is composed of the value of the claim, any subsequent balance notified by the customer of the debt collection company, and subsequent payments to the debit balance.


Overview of the amounts owed

The overview of the amounts owed specifies the individual elements of the total amount payable, so that you can see what your financial obligation composed of.


Related costs and fees (accumulated claims)

The accumulated claims include related costs and interest associated with the main claim and is the claim against the debtor arising from its breach (interest charges, reminder fees and third-party costs, such as bank chargeback fees).



A settlement is an agreement between the parties through which the dispute or any outstanding issue is settled via a compromise.