How does a debt collection agency work?

The debt collection company will first send you a so-called "debt collection letter" or "Inkassoschreiben". In this letter, you will be asked to pay the amount owed, warning letter fees and collection costs.

If you neither pay nor react/disagree, the debt collection agency may go to court. The court will then decide whether the claim was justified, i.e. whether you have to pay. Until the court rules, there will be no compulsory enforcement against you.