Debtor
A debtor is an individual or organization that owes money to another individual or organization. Debts are typically created when a borrower agrees to a loan or other form of credit from a lender. The borrower is then obligated to repay the loan or credit in full, plus any applicable interest or fees. Debts can also be created through contracts, such as when a customer purchases goods or services from a business. In this case, the customer is the debtor and the business is the creditor.
History of the Term
The term “debtor” has been in use since the 15th century, when it was used to refer to a person who was in debt. The term has since evolved to include organizations as well as individuals. In the modern era, debtors are typically subject to legal action if they fail to repay their debts. This can include wage garnishment, seizure of assets, and even bankruptcy.
Comparison Table
| Debtor | Creditor |
|---|---|
| Owes money | Is owed money |
| Subject to legal action | Can take legal action |
Summary
In summary, a debtor is an individual or organization that owes money to another individual or organization. Debts are typically created when a borrower agrees to a loan or other form of credit from a lender. Debts can also be created through contracts, such as when a customer purchases goods or services from a business. In this case, the customer is the debtor and the business is the creditor. For more information about debtors and creditors, you can visit websites such as Investopedia, The Balance, and the U.S. Small Business Administration.
See Also
- Creditor
- Loan
- Credit
- Interest
- Fees
- Contracts
- Wage Garnishment
- Seizure of Assets
- Bankruptcy
- Debt Collection
