Do you have reason to believe that you don’t owe what your creditor is asking of you?
If so, keep reading.
I’ve compiled a comprehensive guide on what disputing a debt is, when you’re eligible to dispute it, and if you should even dispute your debt at all.
Let’s get right into it.
What Does it Mean to Dispute a Debt?
To put it simply, a disputed debt is a disagreement between a debtor and a creditor about whether a debt is owed at all or the amount of the debt.
If you believe that you don’t owe your creditor what they are demanding from you, you may choose to dispute the debt.
If you’re eligible to do so, a dispute with regards to the existence or amount of debt can be taken up in court.
There are a number of conditions and situations where you’re eligible to dispute your debt and a number of situations where you’re not.
The next few sections will address everything you need to know about disputing a debt in the UK.
When Can You Dispute a Debt?
Before you attempt to dispute a debt, you need to make sure you’re meeting a few requirements.
The first thing you need to check is if you’ve accepted liability for the debt.
If you’ve agreed to pay the debt back in the past, or even opted for a debt solution that covers your debt, you’re liable to repay that amount.
When you’re looking to dispute a debt, make sure to check if you’ve ever accepted liability for the debt. If so, you’re not allowed to dispute it.
Secondly, if a debtor is charging you an amount that you don’t think is right, or if you think it is more than what you agreed on, you should definitely go through all the paperwork related to the debt.
You may find proof that the actual amount owed is less than what your creditor is charging you. If so, you can take the issue up.
Lastly, if you’re looking to dispute a debt because a debt collector called you and asked for the money, don’t immediately assume that you don’t owe the debt.
Instead, check if your creditor has sold off your debt to this debt collection agency and if you now owe repayments to them instead of your original creditor.
Am I Eligible to Dispute a Debt? – 7 Criterion to Meet
This section will address the seven criteria you can employ to dispute your debt.
If you feel like you don’t owe what you’re being asked for, it may be useful to understand if you’re eligible to dispute the debts.
- If you were underage when you signed the agreement
The first criterion is if you were not of age when you signed the credit agreement.
If you were under eighteen when you signed your credit agreement, your agreement isn’t valid under the law.
Check if you have any proof that you were not eighteen when you signed the agreement, and if so, you can dispute your loans.
- If you didn’t sign an agreement at all
If you didn’t sign a credit agreement at all, this is a valid criterion to dispute your debts.
A credit agreement is a legal document that affirms that you are agreeing to the promise of repayment at some point down the line. If it doesn’t exist, you can dispute your debts.
- If you were pressured/coerced into signing the agreement
The corporate world can be very tricky to navigate at times.
You have a plethora of sales representatives and business managers trying to stick their hands in your pockets and make you believe that they’re doing you a service.
If you think that your arrangement was unfair in terms of the external conditions associated with it, such as representatives coercing you or pressurizing you into agreeing to the deal, you can potentially use this as a reason to dispute the debts.
- If you didn’t understand the agreement
If you didn’t understand what you were signing, you can use that as a reason to dispute the loan.
The law states that companies have a responsibility to provide clear data and information on what they’re signing you up for, the nature of the agreement, and the specifics of the arrangement.
If your creditors used misleading or complex language on purpose, and you don’t recognise or understand it, challenge the loan.
- If your name isn’t on the agreement
If you read the credit agreement and don’t find your name on it, it means you’re not legally responsible for paying back the loan.
In such a circumstance, if the creditor or a debt collection agency is contacting you and chasing you around for repayment instead of someone who’s legally responsible for the loan, you can dispute the loan and take the issue up in court.
- If what you’re being asked for doesn’t match the agreed-upon conditions
It’s a straightforward principle: you should only have to pay what you agreed upon, nothing more.
If your creditor tries to cheat you into giving them something you didn’t agree to, you have a right to dispute the loan.
Under the law, there’s a period of fourteen days in which you may choose to cancel the agreement if you find that you’re not getting what you agreed upon. In this instance, the law is on your side.
- If the credit agreement has incomplete or incorrect information
Your creditors are legally responsible for ensuring that all the information on your credit agreement is correct and that there’s no information that is missing.
If you find information that is clearly incorrect, or if there’s some missing information on the credit agreement, you may be eligible to dispute the loan.
Credit Agreement – What to Look For?
The credit agreement is the central part of the entire loan process.
If you’re about to sign a credit agreement, or planning to sign one in the near future, you need to be aware of what you should be looking for on the agreement.
Don’t worry, we’re here to solve that problem for you.
The things you should be looking for are details on how interest is applied to any outstanding balance, the annual interest rate, the period of the loan, the terms of repayment, the fees linked to the account (if any), and the consequences for late repayments.
My Creditor Sold Off the Debt… Is this Disputable?
Selling debts usually isn’t an issue where a dispute can be brought up.
However, the good news is that your rights remain the same regardless of whether your creditor sold your loan off to a debt collector or not.
If you don’t recognise the loan and you think you don’t owe them money, you can still choose to dispute it.
Debt Dispute Letter
A debt dispute letter is a letter that you can send to a debt collection agency to have them prove that you owe money and that you owe the amount they’re claiming you owe.
It demands that the collection agency provide documents and financial information to prove that you do indeed owe what they want you to pay.
If you’re being hounded by a collection agency, a dispute letter is a great way to make them back off, especially if you know they can’t prove that you owe them a certain amount.
FAQs – Debt Dispute
Can my debt be written off if I dispute it?
It’s possible that in some situations, your debt may be written off if you dispute it.
If you’re able to prove in court that you never accepted liability for the debt, or that your debt is statute-barred, for instance, it can be written off if things go your way.
How long before the debt becomes uncollectible in the UK?
The limitation period in England and Wales for most types of debt is a period of six years from the point when your debt was acknowledged by your creditor for the last time or six years from when your creditor last contacted you about the debt.
For home mortgage loans, this is a period of twelve years from the point when your debt was acknowledged by your creditor for the last time or twelve years from when your creditor last contacted you about the debt.
Can creditors take money from my wage?
Creditors are allowed to take money from your wages via an “attachment of earnings order”.
If they get such an order approved, your creditor is allowed to take a certain percentage of your wages whenever you get paid and use it to contribute towards your debt.
Can I get debt collectors off my back?
Debt collectors can be very unreasonable and problematic at times.
If you’re being chased by debt collectors, you need to know what you can do to get them off your back.
As per the law, collectors aren’t allowed to threaten to take you to court as a way of getting you to pay them.
If they do attempt to do so, it’s technically considered harassment. You can take them to court and possibly get them off your back for a while via a court order.
Can I inherit a debt after a parent dies?
You don’t “inherit” your parent’s debts as your own once they pass away.
In the UK, the money the deceased person owes is then taken from their estate, the property they owned.
The only case where you’re responsible for their debts is when you had a joint loan or provided a loan guarantee.
Wrapping it Up
When you’re unsure of whether you should pay a debt or not, or if you don’t recognise the debt, you may look into disputing a debt as a valid opportunity.
This guide was intended to teach you how to approach the subject of disputing a debt and when you’re eligible to do so.
If you need any more debt advice, do reach out.