DWP Debt Management Letter – Should You Pay? 

Have you received a letter from DWP Debt Management and are feeling worried? You’ve come to the right place. Over 170,000 people each month come to our website for help with debt problems.

In this guide, we will tell you:

•  How to check if the debt they say you owe is really yours.
•  What you can do if you can’t pay the money they ask for.
•  Ways to ask DWP Debt Management to show proof of the debt.
•  How to deal with letters from DWP Debt Management.
•  What might happen if you don’t deal with this debt.

Dealing with debt collectors can make you feel concerned. This is quite common, as nearly half of the people who are chased by debt collection agencies have experienced harassment or aggression¹.

Don’t worry, we want to help you understand your letter and what you can do about it.

Why is DWP contacting you?

DWP Debt Management may have written to urge you to repay a benefit advance or to inform you that you’ve been overpaid in your benefits for a variety of reasons, including the following:

• You got a short-term benefit advance or a ‘budgeting loan’ from the government because you needed money before your benefits payment day. The government didn’t charge you any interest on the loan.
• You failed to record a change in circumstances that would have affected the number of benefits you were entitled to, such as moving in with a partner.
• You provided incorrect information when filing your benefits claim or reporting a change in circumstances.
• Your payment was made incorrectly by the DWP.
• It’s also possible that you haven’t been overpaid and the DWP Debt Management letter was issued in error.

Ask DWP to Prove the Debt

Just because DWP Debt Management state you owe the money doesn’t mean they will be correct 100% of the time – although they most often are.

» TAKE ACTION NOW: Fill out the short debt form

There could be circumstances they do not know about, or they may have the wrong information on file for you (such as income, etc.).

For this reason, before you pay, request proof of the overpayment, which involves asking them to carry out a ‘mandatory reconsideration‘.

Why You Shouldn’t Ignore the Letter

We always recommend responding to debt collectors – even just to question the debt’s validity.

Remember, you have the right to request proof of the debt. They have to prove it or they can’t charge you.

The worst thing you could do in this situation would be to ignore the DWP Debt Management letter. By ignoring the letter, you could open yourself up to legal proceedings.

Even if you can’t afford to pay the amount stated in the DWP Debt Management letter, do not ignore it. There are ways around this problem before the DWP Debt Management’s debt recovery process gets underway.

What Happens If You Don’t Pay?

If you don’t pay DWP Debt Management, they could raise a court case against the overpayment to get a CCJ (county court judgement) that forces you to pay.

A CCJ on your credit file could make it harder to get a loan, credit card or mortgage for 6 years when it expires.

Enforcement agents (Bailiffs) could come to your home and demand payment or take your valuable items to be sold and pay off the overpayment debt.

But in most cases, this can be avoided (even when you can’t afford to pay it back!)

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What happens if you can’t afford the repayments?

Owing money is never a nice experience. However, the first thing you should do if you receive a letter from the DWP is to get in touch with them.

While they would like the money owed back straight away, they cannot force you to do this. Instead, they will talk with you about your income and earnings, plus your expenditures.

Then they should come up with a solution that involves affordable repayments to help you pay off any debts owed.

Any financial hardship considerations would be taken into account.

The DWP would send you an Income and expenditure form to help evaluate your circumstances before agreeing on a repayment plan.

How Do Joint DWP Overpayments Work?

You may have received financial support from the DWP as a couple.

If that is the case and you have now been issued with a DWP Debt Management letter to recover the overpaid benefits you received jointly.

It’s worth noting that you are both responsible for 100% of the debt.

Some people may have separated from the person they received the DWP payment with. You are both still 100% responsible for the benefit overpayments.

As such, you cannot leave it up to the other party to pay.

Complain About Your DWP Debt Management Letter

If you believe there has been a mistake and you were not overpaid, you should first provide DWP Debt Management with the correct information.

This could be done over the phone and you may need to send them documents.

If they disagree and you still believe their calculations are incorrect, you do have the option to complain about DWP Debt Management to the Independent Case Examiner.

But you must follow the DWP complaints procedure first.

They will weigh up the facts to decide what has happened. They are impartial and operate fairly when it comes to debt collectors reaching a conclusion.

We suggest you seek advice on DWP overpayment appeals from a debt adviser first.

DWP Contact Information

References

1. Indebted Debt Collection Survey