Whether it was something you were expecting, or it’s come out of the blue, a letter or perhaps a phone call from Lantern Debt Collection can leave you confused. If you don’t know what debt they’re referring to, or you do but you don’t know what the next steps are, then read on to see what you should do.
It’s not your fault. Complaints to the Financial Ombudsman have risen this year from 830 to 2,006, so it’s safe to say that you’re not alone.
Deal with your debt today and feel better tomorrow.
Who are Lantern?
Lantern Debt Recovery Services are a debt collection agency who are based in Leeds in the UK. They used to be called Motormile Finance, and historically dealt with car finance, but since the rebrand they now deal with debt recovery.
This means they deal with debts from other companies and they attempt to reclaim the money from the borrower who owes it. On some occasions a business may employ Lantern to collect the debt on their behalf for a share of the profits. But in most cases, Lantern will purchase the debt from a creditor. This is usually done at a heavily discounted rate, sometimes as low as 20% of the cost of the debt.
They’ll do this because it means they can then try to reclaim the full amount from the person who owes the debt, meaning they’ll make a tidy profit. This’ll be justified in the credit agreement the customer originally signed. A creditor will often sell the debt because it means they’re guaranteed some return, without the hassle of chasing a debtor themselves.
Say you owe £2,000 on a credit card that you haven’t made payments on. Lantern may buy this debt from the credit card company, potentially for as low as £400. You’ll still owe the full £2,000 and Lantern will now be your creditor. Depending on the details in your credit agreement, you’ll probably stop paying extra interest on the debt now, but you’ll need to set up payments to Lantern instead of the credit card company.
Don’t worry, here’s what to do
You could get rid of debt collectors by writing off your debt. I’ve put together a 4 question debt calculator which will tell you if you’re eligible:
Why have Lantern got in touch?
If Lantern have either written to you or called you, it means they’ve taken on a debt that you owe to somebody. It might be a debt you’re aware of, or on some occasions it might be an old debt that you didn’t know you owed.
It could also be a mistake. Sometimes you may have paid a debt off, but an administration error means it’s still showing as owed. Or it may be that mistaken identity is at play. Don’t pay up if you think that’s the case, but don’t ignore it either. The first thing you should do is check to make sure whether it is your debt or not, and whether you still owe it. Ignore a letter or phone call, even if you know the debt isn’t yours, will only lead to further issues.
Is Lantern a legitimate debt collector?
Yes, Lantern is a legal and legitimate debt recovery company. They have authorisation and are regulated by the Financial Conduct Authority to make sure they act in the correct way. This means you should be treated fairly.
It also means you shouldn’t ignore any communication with Lantern. If they’ve got in touch, then they have your name associated with a debt they own and are entitled to pursue it with you.
Find your best debt solution
Is all this information starting to feel overwhelming? Don’t panic! I’ve put together a 4 question debt calculator so you can quickly and easily find the best solution for you. Answer the four questions now.
Should you repay Lantern?
In short – yes. If you’re sure that the debt is yours, you do owe it, and you can afford it, then you should speak to Lantern immediately to clear the debt. However, you mustn’t put yourself into further financial difficulty to do so. Lantern shouldn’t be asking you to pay amounts that you can’t afford and should instead consider a repayment plan with you.
If you are ready to pay your debt off, the best way to do this quickly is to give Lantern a call and have your card details ready. Remember that the sooner you do clear the debt, the sooner they’ll stop contacting you, and the sooner you can get to work on rebuilding your credit profile.
What action can Lantern take?
As an authorised debt recovery agency, Lantern are allowed to contact you to ask you to request that you pay the debt. If you say that you won’t pay, they can take further action such as petitioning for a County Court Judgement or other intervention by the court. However, they aren’t empowered to take any further action themselves so can’t send round bailiffs to recover your possessions. They’d have to ask the courts to do that on their behalf.
Lantern and the FCA
As Lantern is overseen by the Financial Conduct Authority, they’re bound by their regulations on what they can and cannot do to recover the debt. These regulations are designed with the customer in mind, but they don’t give you complete protection – Lantern are entitled to the money, after all.
There are some of the actions that Lantern should not be taking. These include:
- Attempting to contact you an excessive number of times, or during unsociable hours of the day i.e. early morning/late night
- Ignoring your preferences on communication method (i.e. calling you if you’ve asked to deal with them by post)
- Encouraging you to take on more debt in order to pay what you owe to Lantern
- Using purposefully confusing language or jargon to confuse you
- Talking about your debt you owe with someone other than yourself
If Lantern are doing any of these things to attempt to recover the debt, or you just feel harassed by their communication and can provide evidence to back yourself up, you can write a formal complaint to the Financial Ombudsman who will investigate.
Trying to find reviews of Lantern can be difficult to find online – they only claimed their Trustpilot account in February 2020. However early reviews are mixed:
“If you need a company to help you with your debt, this one surely should be the one! Great service, great help and they let you plan your own repayment plan by letting you do an affordable instalment for yourself!Iuri Medeiros Esteves- https://trstp.lt/ejokX9fCg
“If I could give no stars I would. They like to harass vulnerable people and do not take your circumstances into account. They are not sympathetic at all and are do (sic) not help in any way.”Jamie Rands – https://trstp.lt/N0L2_Plw3
How to find out more about a debt with Lantern
When you first hear from Lantern about a debt they claim you owe, you should instantly be making sure that the debt is definitely yours. Most of the time, you’ll know that it is, but if not then you should seek clarification, ideally via phone call or email.
Sometimes, you might receive a letter or phone call that’s meant for someone else. It might be a simple case of someone with the same name, with Lantern trying to find the right person. Or it could be that the person who lived in your home before you had debts, and Lantern is contacting you as the current resident. These can all be resolved fairly easily although Lantern will ask for proof that you aren’t the owner of the debt. If you struggle to easily prove it then don’t worry, the onus is on Lantern to prove it’s yours – just ask them to send evidence. If they harass you without further details, you’ve grounds to complain to the Financial Ombudsman.
Next up, you need to check that the debt is valid. You might have already paid it off, or it might be ‘statute barred’. Simply, this means the debt has expired – if it’s been six years since you’ve acknowledged the debt exists (either in writing or by making a payment) then it shouldn’t be enforceable by Lantern. This timeframe is only five years if you’re based in Scotland.
If, after you’ve carried out these checks, you don’t think the debt is yours to pay, you should call or email Lantern to let them know. Try to provide clear evidence why the debt isn’t yours, otherwise Lantern may try to claim you do have to pay it. Again, the onus is on them to prove it, but you’ll save yourself some hassle if you can demonstrate it yourself early on.
Follow my ‘prove it’ guide with letter templates and get them to prove that you owe the money.
What to do if you can’t afford to repay Lantern
By now you’ll have established whether the debt is yours. If it is, but you can’t afford to pay it, then you should get in touch with them straight away and give them details of your situation. If you ignore it, the chasing will only continue.
Initially, Lantern may make you an offer of a lower sum to clear the debt.
MoneySavingExpert forum ‘Gooner5000’ was contacted by Lantern.
“…on the 25/10, Lantern UK/MMF emailed out of the blue offering me a ‘spooky’ settlement offer of £62.50 on a £250 debt (old payday loan) but it expired on the 31/10. I couldn’t afford to make the payment as well but I emailed them back explaining and offering to settle at the end of November for that amount.
However, this week I managed to sell a couple of bits on eBay and raised £84, literally everything I have until Friday… I contacted lantern and made the offer of £63 but they declined, I explained my situation but they kept saying the offer expired, So I offered £84 but they still declined.
They said the offer now is a 40% reduction meaning £150 and is available today only, which I can’t afford or I can set up a monthly plan to clear the full amount on Friday.
I’d struggle in a Christmas month to pay the full £250, and reluctant, if they were willing to accept £62.50 initially… how can it expire?”
In this situation, Lantern have made a number of lower offers to the customer which they are under no obligation to do. The customer missed out on the opportunities presented and that resulted in needing to pay a higher amount. You may receive the same treatment, but don’t expect it.
If you aren’t made an offer, or you are but you can’t afford it, you’ll need to set up a repayment plan for the full amount of the debt. You may need to provide a budget, which breaks down your income and expenditure, to show how much you can realistically afford to pay.
And it is vital that it is realistic. Don’t try to cut corners in order to get the debt monkey off your back. If you feel pressured, you should just remember that a repayment plan is all the action you need to take. Try to repay too much and you’ll only end up having to refinance or end up in court when you fail to make a payment that you’ve agreed to with Lantern.
If Lantern isn’t your only debt and you’re struggling to make all your repayments, it may be worth considering a debt solution such as a Debt Management Plan (DMP) or an Individual Voluntary Arrangement (IVA). These will enable you to establish your budget and set up realistic, achievable monthly repayments to all of your creditors, and in the case of an IVA it may also get some of your debt written off.
If you intend to go down the route of a DMP or IVA, you should still let Lantern know immediately. They should then give you time and breathing space to get set up.
How to get in touch with Lantern
If you need to get in touch with Lantern directly to either query a debt or to make a complaint to them, here are their details:
Phone: 0113 887 6876
Address: Lantern, Protection House, 83 Bradford Road, Leeds LS28 6AT
Lantern’s opening hours for phone calls are 8am to 7pm Monday to Friday and 9am to 2pm Saturday. They are closed on Sunday.
Complaints about Lantern
If instead you need to complain about Lantern Debt Recovery Services to the Financial Ombudsman, you can do so here:
Phone: 0300 1239 123
Whether you need to find out more information about a debt Lantern claims you owe, or you want to repay it, the best thing to do is to speak to them as soon as you can. If you ignore it and hope it goes away, the problem will only grow, and you could face serious legal action and crippling financial implications that could also impact your job.