Cobra Financial Debt Collection – Do You Need to Pay?

Have you received a letter from Cobra Financial Debt Collectors? You might be feeling worried or confused. But don’t worry; you’re in the right place to get answers.

Every month, over 170,000 people come to our website for help with debt issues, just like yours, so you’re not on your own.

In this helpful guide, we will explain:

• Who Cobra Financial Debt Collectors are and if they’re fair
• How to find out if the debt they say you owe is really yours
• Steps to take if you can’t pay or want to challenge the debt
• Ways to stop them from bothering you too much
• Different plans to help manage your debt or maybe even reduce it.

Our team knows what it’s like to get letters from debt collectors as many of us have been there too. We understand how you feel.

Let’s learn more about how to handle Cobra Financial Debt Collectors together.

What to do next

So that’s the basics about Cobra debt recovery. Now we’ll give you a guide on how to deal with them. If you plan carefully, you may even be able to beat them at their own game.

Gather information

As soon as you receive any correspondence from Cobra debt recovery, make sure you read through it carefully and note down exactly who they are collecting the debt on behalf of. Then go through your own documents and find as much information about the original creditor as you can. If the amounts are different after cross-referencing them, you may not have to pay them.

Know your rights

Cobra debt recovery is somewhat renowned for being quite heavy-handed. They specialise in home visits and often will arrive at your door very early in the morning. 

Cobra debt recovery is not regulated by the Financial Conduct Authority, which means they do not have to adhere to their rules and regulations. That being said, they should at least treat you with some respect, including not harassing you, not misleading you, or threatening and abusing you.

Prove the debt

If you don’t think that the debt is yours, you can send Cobra debt recovery a ‘Prove the Debt’ letter. This means they will have to respond with evidence of the debt in writing.

You can find templates for a ‘Prove the Debt’ letter here.

Statute-barred debts

If it has been 6 years – or 5 years in Scotland – since you last paid towards your unsecured debts and you have not written to your creditor about your debt during this time, it is statute-barred.

This means that the debt is not enforceable. It still technically exists, and you still technically owe the money, but there is no legal way for you to be forced to pay or for the debt to be enforced.

Keep in mind that not all debts become statute-barred!Any HMRC debts, for example, will stay enforceable for decades. Any debt that had a County Court Judgement (CCJ) attached to it during the 5 or 6-year window it will be enforceable for the duration of the CCJ.

You can use my free letter template to write to Cobra and explain that your debt is statute-barred.

» TAKE ACTION NOW: Fill out the short debt form

What is the Debt Collection Process?

In the UK, debt collection follows a fairly standard process. This is because groups like the FCA have set up rigorous guidelines to help protect consumers.

In the most basic terms, debt collection follows the following process:

1. Your creditor sells your debt to a debt collection company. Your creditor may employ a second company to chase you rather than sell the debt.
2. The debt collection company will begin to chase you for the debt.
3. You can pay the debt in one go if you can afford to, or you can opt for one of their offered payment schedules.
4. You stick to the repayment schedule until the debt is paid.

But if you ignore the debt collectors altogether or don’t pay or stick to your repayment schedule, the process gets more serious:

1. You will be sent a letter of claim – you have 30 days to respond.
2. You will be sent a default notice – generally, you will have 14 days before legal action begins.
3. A County Court Judgement (CCJ) form will be issued – now is the time to get legal advice! You have 14 days to respond.
4. You will receive the CCJ – your judgement will be sent to you. You must abide by these terms.
5. If you don’t stick to the CCJ terms, you may receive a Warrant of Control, which will give bailiffs the authority to enter your home and take your goods. These will be sold at auction to cover the cost of your debts.
6. A Charging Order can be issued against your home if you own it, or an Attachment of Earnings Order can be issued, which will take money from your paycheck.

What kind of reviews does Cobra debt recovery have?

Most debt collection agencies don’t have glowing reviews. No-one likes a strongly-worded letter claiming that they owe an amount of money they may not even realise they owed, after all. Cobra debt recovery, on the other hand, has quite good reviews. 

On Trustpilot, they have a 4.9 rating, and in 2019, they had a 90% success rate – equating to £14 million collected, which is an industry high. Be warned, though – leaving a bad review on Trustpilot will lead them to chase you up, and they have even threatened police action against bad reviewers!

You also need to be aware that these reviews include their clients and very few reviews appear to be from people they have chased for debts.

Will a CCJ Affect My Credit Score?

Unless you pay within one month of the CCJ being issued, it will be recorded in the Register of Judgements, Orders and Fines for 6 years. If you pay off your debt within these 6 years, you can request that your judgement is marked as ‘satisfied’ on the register.

To do this, write to the court with proof that you have paid off the debt in full.

If you manage to pay within one month of the CCJ being issued, the judgement will not be recorded in the register. You will need to write to the court explaining that you have paid and provide proof.

CCJs are also visible on your credit file for 6 years. This will make it almost impossible for you to get credit during this time.

This is because companies use your credit file to see if you are a ‘high-risk’ customer – someone who might have difficulty paying their bills on time. If you have a CCJ, you have had such trouble paying back your debt that someone had to go to court about it.

Understandably, companies are going to be reluctant to give you credit!

After 6 years, it is no longer visible on your credit report and you should find it easier to get credit again.

Can I Get A Debt Solution?

If you have several unsecured debts, you may benefit from a debt solution.

There are several different debt solutions available in the UK, so I recommend speaking to a debt charity fro some free advice. Their advisors will be able to walk you through your options in detail and find the best solution for you.

I have linked some charities that offer these services for free.

Debt Management Plan (DMP)

A DMP is an informal debt solution that lets you pay off your debts via a single monthly payment.

Because it is informal, it is not legally binding so you are not tied into a DMP for a minimum number of payments.

Individual Voluntary Arrangement (IVA)

An IVA is a formal agreement between you and your creditors. You agree to pay a monthly sum that is distributed amongst your debts, and your creditors agree not to contact you during your IVA.

IVAs typically last for 5 or 6 years, and any outstanding debt is wiped off when it ends.

Keep in mind that IVAs are not suitable for everyone. You need to owe several thousand pounds to more than one creditor to be eligible. You also need to demonstrate that you have some disposable income every month.

Trust Deed

IVAs are not available in Scotland. Instead, you will need to opt for a Trust Deed.

Trust Deeds work in the same way as an IVA – you pay an agreed sum each month that is shared amongst your creditors, they can’t contact you, and any leftover debt at the end of your Trust Deed term is written off.

Debt Relief Order (DRO)

A DRO is a good option for those facing financial hardship with no assets and little income.

For 12 months, you make no payments, but your creditors freeze your interest and don’t contact you.

If your finances haven’t improved during this year, you may be able to write off your unsecured debts.

Bankruptcy

If you have debts but no realistic possibility of ever paying them off, you may need to declare bankruptcy.

Bankruptcy has an unfair stigma attached to it as it may be your only way of getting a financial fresh start. That said, it is a serious financial situation that should not be taken lightly.

Sequestration

Sequestration is the Scottish version of bankruptcy.If you have little income and no valuable assets, you may be able to apply for a minimal asset process bankruptcy (MAP). A MAP is a quicker, cheaper, and more straightforward version of sequestration, so worth considering.

Thousands have already tackled their debt

Every day our partners, The Debt Advice Service, help people find out whether they can lower their repayments and finally tackle or write off some of their debt.

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How Do I Make A Complaint About Cobra Financial?

If you think that Cobra has been unreasonable or behaved inappropriately, you can make a complaint. You can also make a complaint if you feel that they have broken any of the Financial Conduct Authority’s (FCA) guidelines.

Make your first complaint to Cobra so that they have the chance to sort out the issue themselves. If you feel that they have not taken your complaint seriously enough or have not addressed your issue properly, you can escalate matters.

You can make any secondary complaint to the Financial Ombudsman Service (FOS). They will investigate and, if your complaint is upheld, Cobra may be fined. You could even be owed compensation.

Cobra Financial Debt Collection Contact Information

FAQs

Below, we answer some of the more commonly-asked questions about Cobra debt recovery and debt collection agencies in general.