Debt Collection Industry Statistics

Q: How long can a debt collection agency chase you?

From the date that the debt is acknowledged, the law allows a creditor six years to pursue repayment. This extends to 12 years for mortgage debt.

For free & impartial money advice you can visit MoneyHelper. We work with The Debt Advice Service who provide information about your options. This isn’t a full fact-find, some debt solutions may not be suitable in all circumstances, ongoing fees might apply & your credit rating may be affected.

Welcome to our guide on ‘Debt Collection Industry Statistics’. This is the right place if you are looking to understand more about your debts and how they compare to others.

Each month, over 170,000 people visit us for advice on debt solutions. We’re here to help with clear, easy-to-understand information.

In this guide, we’ll explore:

What a debt collection agency is.
How you might reduce some of your debt.
Some key statistics about the debt collection industry.
Tips to avoid debt collection penalties.
What to do if you’re finding your debt hard to manage.

You might feel like your debt is larger than most. Our team has dealt with these concerns too, so we know how you feel.

Let’s get started and learn more about debt collection industry statistics and find answers to your questions.

Debt Collection Industry Statistics

If you were to make minimum payments on a maxed-out credit card with an average interest rate, then it would take more than 25 years to clear the balance. If this shocks you, then you’ll want to read on to learn more fascinating debt collection statistics!

Debt Recovery Statistics

In the second quarter of 2022, lenders wrote off £601 million of debt, of which £247 million was credit card debt.

This amounts to £6.6 million written off every day. This happens for several reasons, including bankruptcy and insolvency.

Bankruptcy and insolvency are taking place at a rapid rate across the UK:

Every day in the first quarter of 2021, 290 people in England and Wales declared insolvency or bankruptcy. That’s one person every five minutes.
In September 2022 in Northern Ireland, 5.1 people declared insolvency every day.
In the three months to June 2022 in Scotland, 22.4 people declared insolvency every day.

There are many aspects of finance that can push a person towards difficulty with debt. Read on to discover fascinating insights into these areas!

How a debt solution could help

Some debt solutions can:

Stop nasty calls from creditors
Freeze interest and charges
Reduce your monthly payments

A few debt solutions can even result in writing off some of your debt.

Here’s an example:

Situation

Monthly income	£2,504
Monthly expenses	£2,345
Total debt	£32,049

Monthly debt repayments

Before	£587
After	£158

£429 reduction in monthly payments

If you want to learn what debt solutions are available to you, click the button below to get started.

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UK Household Debt

As of August 2022, the average household had £2,244 of credit card debt.
As of August 2022, the average household had £65,346 of total debt.
Between October and December 2020, a property was repossessed approximately every 16 hours.
In 2021, mortgages moving into arrears of over 2.5% of the remaining balance rose by 18 per day.
In March 2021, The Office for Budget Responsibility forecast that household debt of all types is set to £2.354 billion in 2025.

UK Personal Debt

The UK population owed £1.698.4 billion at the beginning of 2021.
In August 2022, the UK’s total interest payments on personal debt over a 12-month period were £49.286 billion, an average of £135 million per day.
As of August 2022, the average adult in the UK had £3,877 in unsecured debt.
As of August 2022, outstanding consumer credit lending was £205.1 billion, rising by £690 million in the previous month.

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.

I’d recommend this firm to anyone struggling with debt – my mind has been put to rest, all is getting sorted.

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UK Unemployment

476,000 18-24-year-olds were unemployed in the first quarter of 2021.
2,267 people were made redundant every day between December 2020 to February 2021.

UK Cost of Living

The average cost of raising a child from birth to the age of 18 is £23.25 per day for a couple and £28.22 per day for a single parent.
On average, a UK household spends £4.20 a day on water, electricity and gas.
On average, it takes 22 years for a first-time buyer to save for a house deposit.

Debt Collection Industry Statistics FAQs

When does debt collection become necessary?

If you default on your debt repayments, then this debt may be sold to a collection agency. You might not know this has happened until the agency that now owns your debt contacts you for payment.

How long can a debt collection agency chase you?

From the date that the debt is acknowledged, the law allows a creditor six years to pursue repayment. This extends to 12 years for mortgage debt.

How do debt collection agencies track you down?

Debt collectors have access to information from credit reference agencies. This usually enables them to find debtors through the listed address on their bills.

Sources

UK Debt Service

The Money Charity