What is the primary function of Reason Status codes in debt management?

The primary function of Reason Status codes in debt management is to indicate the state of debt throughout its lifecycle. These codes provide critical information that helps users understand where a particular debt stands at any point in time—whether it is active, in collection, or resolved. By using these codes, debtors, and agency personnel can efficiently track and manage debts by knowing their current status, which is essential for effective debt management practices. This allows organizations to apply appropriate actions based on the status, ultimately enhancing financial oversight and ensuring compliance with applicable regulations.