What is a debtor?

A debtor is an individual or business that owes money to a creditor. In the context of payroll, the company or employer is often considered the debtor when they owe money to employees in the form of salaries or wages.

What are the penalties for not paying debts?

Failure to repay debts can lead to various consequences, including:

• Property repossession
• Legal actions and lawsuits
• Accumulation of fees and penalties
• Negative impact on credit scores
• Court judgments resulting in liens or encumbrances

How do creditors and debtors differ?

Creditors are entities or individuals who extend credit to debtors. They are the ones who provide goods or services and agree to receive payment at a later time. Debtors, on the other hand, are the recipients of these goods or services and are obligated to repay the owed amount to the creditors.