Legal Question in Credit and Debt Law in Texas

Re: Collections after settlement

That would be rather unusual, but it depends on whether the collector bought the debt or is merely an agent for the creditor.

If the collector bought the debt, then the original creditor cannot come back at the debtor once the debtor settles with the collector.

If the collector is an agent for the creditor, the collector usually has authority from the creditor to settle with the debtor. But if the collector has settled without authority, the creditor may come back at the debtor. In that instance, the debtor has the defense of implied authority to settle, and that would usually prevail.