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How to Beat Debt Collectors UK? Quick guide

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Scott
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Scott Nelson

Managing Director

MoneyNerd’s founder, Scott Nelson, has a decade of financial industry experience, including 6 years in FCA regulated loan and credit card companies. Troubled by a lack of conscience in the industry, he founded MoneyNerd to give genuine advice to those in debt and struggling financially.

Learn more about Scott
&
Janine
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Janine Marsh

Financial Expert

Janine Marsh is an award-winning presenter and a valuable member of the MoneyNerd team. With a wealth of experience as a financial expert, she's been featured on BBC Radio 4, BBC Local Radio, and BBC Five Live, and is a regular on Co-op Radio.

Learn more about Janine
· Feb 6th, 2024
Could you legally write off some debt? Answer below to get started.

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This isn’t a full fact find, MoneyNerd doesn’t give advice. We work with The Debt Advice Service who provide information about your options.

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How To Beat Debt Collectors

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.

Are you worried because you’ve got a letter from a debt collector? Don’t worry; we’re here to help. Each month, over 170,000 people come to our website for advice on debt matters. We’ll guide you on how to deal with debt collectors in the UK.

In this article, we’ll show you:

  • How to find out if the debt is really yours.
  • Ways to stop the debt collector from bothering you too much.
  • What you can do if you cannot pay.
  • How to talk to the people you owe money to.
  • How to possibly get rid of some of your debt.

We know how scary it can be when debt collectors start asking for money, as some of us have been in the same boat. We understand how you feel.

Let’s get started and learn more about how to handle debt collectors in the UK.

Could you legally write off some debt?

There are several debt solutions in the UK, choosing the right one for you could write off some of your unaffordable debt, but the wrong one may be expensive and drawn out.

Answer below to get started.

How much debt do you have?

This isn’t a full fact find. MoneyNerd doesn’t give advice. We work with The Debt Advice Service who provide information about your options.

First, What Is a Debt Collector?

The term debt collector often gets used for two different types of people/groups with very different jobs.

On the one hand, there are debt collection agencies that buy debt from others or collect debt on behalf of other companies.

These groups try to get debt from you by sending letters asking you to pay or agreeing on repayment plans with you. They have very limited powers but can take the debt to court to get their money if you ignore them.

On the other hand, a debt collector is also a term used for High Court Enforcement Officers, who can also be known as bailiffs. HCEOs and bailiffs have been given authority by the court to take some of your goods to pay off your debt. There are limits to what they take so make sure you know your rights!

How to Beat Debt Collectors UK?

There is very little you can do to beat a bailiff. If the debt has already gone to the High Court, nothing can be done other than find a way to pay.

So, when I talk about how to beat debt collectors in the UK, I am really asking how can you beat debt collection agencies at the start of the debt collection process.

Below you can find ways to counter their threats and claims

1.      Learn Everything there is to Know About The Debt Collector

The first thing to do when faced with a debt collection notice or letter is to do your research. Find out if the company is legitimate and if the debt actually belongs to you by contacting your creditor or checking your credit report.

Additionally, you should read company-specific guides. For example, if you receive a letter from Lowell Financial Debt Collectors, my guide or advice from any other legitimate source should give you a head start. Within these guides, you will find contact details, collection processes or methods of collection, ways to complain and how to deal with them both to protect yourself and to overcome your debt.

2.     See if Your Debt Is Statute Barred

If you are sure the company is legitimate and the debt is yours, there is one instance when you can rebuke their debt claims by telling them the debt is too old to be collected. This is known as statute-barred debt. Your debt will be legally unenforceable if:

  • The debt is at least six years old
  • You haven’t made a payment in the last six years
  • You haven’t agreed that you have the debt in the last six years
  • There is no CCJ for the debt already

If these apply, you can tell the debt collection agency that your debt is statute-barred in a letter.

3.     Request Proof of the Debt

When you first receive a debt letter from a debt collector agency, you should reply requesting proof that you owe the debt. This means they have to send you signed agreements to show that you have defaulted on payments and landed in debt.

If they can’t prove this with evidence, the debt cannot be enforced. If they fail to provide evidence and keep asking for payments, you should keep all communications and make an official complaint.

You can also request a detailed breakdown of the debt as proof that it exists. You may find that some charges or fees have been added that should not have to pay.

4.      Make Official Complaints If Necessary

This isn’t the only reason to make an official complaint. You should also complain if:

  • The debt collection company tries to enter your home
  • They pretend they are the same as bailiffs, i.e. can take your possessions
  • Threaten jail time
  • Discuss your debts to employers and family members
  • Harass you with repeated calls or texts

After complaining directly with no result, you may then complain to the Financial Conduct Authority (FCA) if the company is registered with them or the Financial Ombudsman Serivce (FOS). If they decide the debt collector has acted wrongfully, they may fine them and award you with compensation.

» TAKE ACTION NOW: Fill out the short debt form

How Do I Deal With A Debt Collector?

The most important thing to remember about a debt collector is that you shouldn’t ignore them! This is a surefire way for the agency to take further and more drastic action against you.

Some debt collectors will ask you to pay them immediately. Before you make any payment you need to verify that you do actually owe the debt. Don’t pay until the debt is verified and you are satisfied that you do actually owe it.

If you can afford it, you should take them up on their offer now. If a lump sum is out of the question, many debt collectors will accept a repayment plan.

If you opt for a repayment plan, it is essential that you do not miss a payment so only agree to pay what you will realistically be able to.

Keep in mind that most debt collectors will not visit you at home. If they do, you can phone up the company yourself to organise a standing order or other payment. This makes it easier to keep accurate records of your debt payments.

But sometimes you will find yourself dealing with debt collectors looking for debt that is not even yours!

If this person made a complaint to the FCA or the FOS, it would probably be upheld and they would be due some compensation.

It is unreasonable for debt collectors in this example to contact someone daily just because they don’t believe that the person who owes the money is still there.

How a debt solution could help

Some debt solutions can:

  1. Stop nasty calls from creditors
  2. Freeze interest and charges
  3. 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.

Get Started

Can You Really Beat Debt Collectors?

If you owe a genuine debt, there is nothing you can do to avoid paying the debt, either in full or with one of the many debt solutions that spread out payments. But you can beat debt collectors at their own game by blocking their attempts to make your life miserable until you are able to pay.

Just by knowing your rights, you are beating debt collectors and stopping them from operating illegally.

How Do I Talk To My Creditor?

One of the easiest ways that you can avoid debt collectors is by communicating with your creditors. Regular communication with creditors means that they are aware of your financial situation and intention to pay off your debt. This makes it less likely that they will sell your debt to a collection agency.

I recommend talking to them via letter or email because it is much easier to keep detailed records.

Don’t contact your creditors about a debt that you think is going to be statute-barred soon! This will effectively reset the timer and you will need to wait another six years from the date you sent the letter for it to become unenforceable.

You can confirm with your creditors what debts you owe and how much. Once you have acknowledged these debts, you may find that your creditors are more likely to stop chasing you for payments for an agreed period of time. They may even be willing to freeze your interest.

If you know that you can afford to repay some of the debt, you can negotiate a repayment scheme. Only agree to pay if you can afford it and make sure you get any repayment plans written in writing before you make a payment. This will make it harder for your creditor to dispute!

Keep in mind that your creditor doesn’t have to agree to any of this – they are allowed to ask for you to pay back all of your debt as you originally agreed. However, it is often in their best interest as they may not get as much money back if you opt for a formal debt solution like an IVA.

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.

Natasha

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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Beating Debt Collectors with an IVA

There are some debt solutions that will stop your creditors or debt collectors from contacting you.

Individual Voluntary Agreement (IVA)

An IVA is a good option for those with multiple debts to different creditors. You pay an agreed amount each month and that money is divided amongst your creditors. Once you have made payments for the agreed period of time – usually five years – any remaining debt is wiped.

Some people only pay off around 10% of their debt before all of them are wiped.

You do need to owe more than one debt to qualify for an IVA, and your total debts need to be worth several thousand pounds – usually, an IVA is approved where you owe more than £10,000. You also need to have disposable income in order to make the monthly payment.

If you do not have any disposable income, you may wish to consider a Debt Relief Order (DRO).

Debt Relief Order

A DRO is a good alternative for those who can’t afford an IVA.

To qualify, you need to demonstrate that you have less than £75 of disposable income each month and that you do not own assets not including a car worth more than £2,000. You will also need to prove that your car is not worth more than £2,000.

Once your DRO is approved, your creditors can’t contact you. This includes sending a debt collection agent after you.

You do not need to make any payments on DRO-approved debts during your DRO which will last a year. After a year, your finances are reassessed and you will not have to pay your debts if your financial situation has not improved.

Some debts aren’t part of a DRO – including court fines or child maintenance – so you will need to check with your DRO advisor. You will need to work out a way of paying these debts during your DRO.

Keep in mind that there are different debt solutions that you can use to help beat debt collectors. I always recommend talking to an expert who can help you find the best solution for your financial situation.

Contact any of the following organisations for free debt and financial advice:

What Debts Do I Deal With First?

If you are struggling to manage your debts it can be hard to work out where to start.

The first thing that you should do is identify your priority debts. These are debts that will cause you serious problems if you don’t get them sorted.

Priority debts can include:

  • Rent or mortgage arrears
  • Council tax arrears
  • Energy bill arrears
  • Court fines
  • TV license payments
  • Overpaid tax credits
  • Unpaid child maintenance.

Once your priority debts are sorted, you can move on to dealing with any others that you might have.

Non-priority debts are usually unsecured debts and can include:

  • Credit card or store card debts
  • Unpaid parking tickets
  • Unsecured loans – eg payday loans
  • Unpaid water bills – your water can’t be cut off
  • Debts owed to your family or friends.

These creditors can take you to court to get you to pay. But, unlike priority debts, these services will not be cut off and you will not receive a court fine or the possibility of prison if you do not pay immediately.

Could you legally write off some debt?

Answer below to get started.

How much debt do you have?

This isn’t a full fact find, MoneyNerd doesn’t give advice. We work with The Debt Advice Service who provide information about your options.

A Word on Stopping Harassment

One of the techniques used by some debt collection agencies is that they will apply repeated pressure and create anxiety through multiple calls each day. This behaviour is against FCA guidelines and can result in serious penalty charges to the debt collection company.

You can block them from using this technique by requesting they only contact you at certain times of the day. If they then fail to stick to your reasonable communication preferences, you can make a complaint.

Make your first complaint to the debt collection company. If they don’t deal with your issue appropriately you may be able to make a complaint to the Financial Conduct Authority (FCA) and then to the Financial Ombudsman Service (FOS).

The debt collectors may be forced to pay a fine and issue you some compensation if your complaint is found to have merit.

The authors
Scott Nelson Profile Picture
Author
MoneyNerd’s founder, Scott Nelson, has a decade of financial industry experience, including 6 years in FCA regulated loan and credit card companies. Troubled by a lack of conscience in the industry, he founded MoneyNerd to give genuine advice to those in debt and struggling financially.
Janine Marsh Profile Picture
Debt Expert
Janine Marsh is an award-winning presenter and a valuable member of the MoneyNerd team. With a wealth of experience as a financial expert, she's been featured on BBC Radio 4, BBC Local Radio, and BBC Five Live, and is a regular on Co-op Radio.