Can a Debt Collection Agency Take Me to Court?
A debt collection agency can definitely take you to court. If they are the legal owner of your debt, then the decision to do this would be made solely by them. However, if they have been hired by your original creditor, then the decision to use court action against you would be made by your creditor.
While they can definitely take you to court, this is typically their last resort when they feel that no other tactic is going to get you to make payments towards your debt.
If you feel that a debt recovery agency is going to be taking action against you, I suggest you seek debt advice from a professional. They can help you formulate a payment plan after reviewing your financial situation.
You can then propose this plan to your creditor or debt collection agency (depending on who the legal owner of your debt is) and get them to stop pursuing court action against you.
Here’s what you can do if a debt recovery agency does take you to court.
I Don’t Want Debt Collectors Coming to My Home, What Should I Do?
You shouldn’t worry too much as home visits are fairly rare for people who collect debts. This is because it costs money and is much more time-consuming than a simple phone call.
However, if you’d like to make sure you don’t get a home visit by a debt collector, you can write to them and explicitly tell them this. If they show up at your home after you’ve specifically told them not to, you can take action against them.
I’m Opting for a ‘Full and Final’ Settlement Offer. How Much Will my Debt Collectors Settle for?
This depends entirely on your situation and the amount of debt you owe. Typically, in a ‘full and final’ settlement offer, the lump sum given to the creditor/debt collection agency is typically less than the original debt amount.
Your creditor will only agree to this if they are dissatisfied with the monthly payments you’ve been submitting towards your debt; They would rather have a lesser lump sum payment now.
Again, in a situation like this, I suggest getting debt advice from a professional. They will analyse your situation and help you determine the amount that you should propose to your debt collectors.
How Can a Debt Collector Find Me?
In today’s digital age, everything is connected and it does not take a lot of resources to locate a person.
Even if you don’t have much of a digital footprint, debt collectors have several tools up their sleeve that they make use of to find you.
An example of this would be your credit report which has basic contact information as well as information about where you reside, etc.
Apart from that, a debt collector can also find you through government databases as well as by inquiring from government agencies that may have your details.
Some debt collectors also get information about you through Data Brokers which gather information about people through online surveys, etc.
You may have agreed to give up this information unknowingly such as through a license agreement for a software you may have installed years ago. Hence, this technique does not breach any data protection laws.
What Rights Does a Debt Collector Have?
As mentioned earlier, FCA guidelines are in place to protect you from unfair practices that a lot of debt collectors tend to employ. While some actions of a collector may seem intrusive, you may be surprised to find that they do indeed have the right to do them.
For example, you can’t stop a collector from contacting you entirely if the debt you owe is legitimate. Of course, it’s their job to secure that debt from you and it’s not something you can stop them from doing.
There are other actions which a collector certainly doesn’t have the right to do. For example, data protection laws ensure that a collector discusses your debt only with you; They are not allowed to share the details of it with any of your friends, family or acquaintances.
If you feel that a debt collections agent is doing something he or she does not have the right to do, you can take actions to hold them accountable.
How Do I Stop Debt Collection Letters from Coming to My Home?
If the debt isn’t yours, you can write to the debt collector and tell them to stop sending you letters. It’s a good idea to include evidence that proves the debt isn’t yours as well.
If they keep sending you letters after you’ve proven the debt isn’t yours, then you can report them to the Financial Conduct Authority.
However, if the debt is legitimate and yours, then you can’t stop debt collection letters from coming to your house. Of course, it’s in your credit agreement that your creditor has the right to employ an agency to pursue you for your debt and this is them exercising that right.
You can stop debt collection agents from visiting you at home and calling you but you can’t stop them from sending you letters.
Why Did My Creditor Sell My Debt to an Agency? How Much Do Debt Collectors Buy Debt for?
Creditors normally sell their debt to an agency when they feel that they’re going to have a hard time recovering it from you. Typically, an agency buys a debt for a lower amount than the debt is originally worth.
Your creditor is willing to make this compromise because they get a lump sum of money immediately rather than waiting months or years to get it from you in instalments.
If your debt has been sold to a recovery agency, you should expect to get a lot more calls and letters regarding your debt than you used to. A typical creditor does not specialise in chasing debts but a recovery agency does. They will be very persistent in contacting you until you are able to pay off your debts.