Lantern Debt Recovery UK – Should You Pay?

Getting a surprise letter from Lantern Debt Recovery UK can be worrying. Luckily, you’ve come to the right place. Each month, over 170,000 people visit our website for advice on matters of debt, just like this one.

In this article, we will guide you on:

• Understanding who Lantern is and why they have contacted you.
• Exploring if you can reduce some of your Lantern debt.
• Learning what action Lantern can take.
• Finding out how to avoid all contact with Lantern debt collectors.

Nearly half of the people who deal with debt collection agencies have experienced harassment or aggression¹. Some of our team members have also been there.

Don’t worry; with our experience, we’ll help you learn how to deal with Lantern Debt Recovery UK.

Why has Lantern contacted you?

If Lantern has 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.

Debt collection agencies buy billions of debt annually at rock bottom prices – at an average of 10p to £1!²

Debt collectors can cause anxiety, but you should know that they have no more legal authority than your original lender and have no special legal powers.

It could also be a mistake.

Sometimes you may have paid 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.

Ignoring a letter or phone call, even if you know the debt isn’t yours, will only lead to further issues.

Make sure the debt is yours!

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 letter or email.

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 relatively quickly, 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.

You can use one of our free letter templates to help you write to Lantern.

Make sure your debt is valid

Next up, you need to check that the debt is valid. You might have already paid it off, or it might be ‘statute-barred’.

Statute-barred debts are debts which can’t be enforced.

This usually means that they are old, unsecured debts and it has been 6 years since you last made a payment or wrote to your creditor about it. If you are in Scotland, you only need to wait 5 years for the debt to become statute-barred.

The debt will still technically exist, but there is no legal way for you to be forced to pay once it is ‘statute-barred.’

Keep in mind that not all unsecured debts can become statute-barred.

HMRC debts, for example, can be enforceable for decades. In a similar vein, if a County Court Judgement (CCJ) was issued against you for the debt within the 6 year window it will always be enforceable.

To be enforceable in court, a debt collector must be able to present an original copy of your Consumer Credit Agreement (CCA), which you signed when you took out the loan.

A CCA is only relevant in cases where your debt was sold to a debt collector, not when the original creditor files suit against you.

If, after you’ve carried out these checks, you don’t think the debt is yours to pay, you should call or email the debt collection company to let them know. We recommend providing clear evidence as to why the debt isn’t yours.

Otherwise, Lantern may try to claim you do have to pay it.

Follow our ‘prove it’ guide with letter templates and get them to prove that you owe the money.

Typical Debt Collection Process

It’s common for Lantern to call or send letters, so don’t worry. It’s part of the first stage of the debt collection process.

We’ve put together this table to help you better understand the debt collector timeline.

If you want to learn more about the key stages and actions involved in this process, don’t forget to read our specialized guide.

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 is 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 (CCJ) or other intervention by the court.

However, they aren’t empowered to take any further action themselves so can’t send bailiffs to recover your possessions. They’d have to ask the courts to do that on their behalf.

» TAKE ACTION NOW: Fill out the short debt form

Janine, our financial expert, explained that while debt collectors can visit your home for payments, they cannot come to your workplace, act threateningly, force payment, or discuss your finances with others.

If they violate these rules, you can complain.

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What to do if you can’t afford to repay Lantern

By now, you’ll have established whether the debt is yours. The quickest and easiest way to get Lantern off your back is to pay them what they are owed.

But you won’t always be able to pay off your debt in one go. You should explain this to your debt collector as they will have to give you some options.

You may be offered a repayment plan.

You may be able to negotiate with Lantern and agree on lower interest rates or even a brief payment holiday to help you get your finances straightened out.

But sometimes that doesn’t work either and you may need to look at a debt solution.

If you are considering a debt solution, you need to speak to someone to get financial advice that is specific to you.

There are several organisations in the UK that offer these services for free and their advisers will be able to help you find the debt solution that works best for you.

• StepChange
• National Debtline
• Citizens Advice
• Debt Advice Foundation.

Debt Management Plan (DMP)

A DMP is an informal debt solution that lets you pay off multiple debts via a single monthly payment.

As it is informal, a DMP is not legally binding whcih means you are not tied into it for a minimum number of payments or a set time frame.

Individual Voluntary Arrangement (IVA)

An IVA is a formal agreement between you and your creditors. You agree to pay a monthly sum that is distributed amongst your debts, and your creditors agree not to contact you during or after your IVA.

Typically, your IVA will last 5 to 6 years and any of your remaining debt at the end of your IVA is written off.

Keep in mind that IVAs are not the right option for everyone. You must be able to demonstrate that you have some disposable income every month to qualify.

You also need to owe several thousand pounds to more than one creditor to be eligible.

Trust Deed

IVAs are unavailable in Scotland. Instead, you will need to look into a Trust Deed.

Trust Deed conditions work in the same way as an IVA – you pay an agreed sum each month that is shared out amongst your debts, your creditors can’t contact you, and any outstanding debts at the end of your term are written off.

Debt Relief Order (DRO)

If you have no valuable assets and a smaller income, you may be eligible for a DRO.

For a year, you make no payments towards your debts. Your creditors can’t contact you during this time and they must freeze your interest.

Your finances are then reassessed and, unless there has been an improvement in your situation, your remaining debts may be wiped off.

Bankruptcy and Sequestration

Bankruptcy – or sequestration in Scotland – has a negative stigma but it may be your only way of clearing your debts and getting a financial fresh start.

This is a debt solution for those with debts that are worth more than the value of everything they own, meaning that there is no realistic way of you ever paying them off.

If you are in Scotland and have few assets, you may be eligible for a minimal asset process bankruptcy (MAP).

This is a quicker, easier, and cheaper process than the sequestration process and is a good option for those with minimal income.

Complaints about Lantern

If you think that Lantern Debt Recovery have broken any of the FCA’s rules and regulations or acted inappropriately, you can make a complaint.

Fortunately, reporting Lantern misconduct and complaining are quite straightforward processes.

First make your complaint directly to Lantern so that they have the oppurtunity to sort out the issue themselves.

If they don’t address your issue adequately, you can escalate matters to the Financial Ombudsman Service (FOS). They will investigate your complaint and, if it is upheld, Lantern Debt Recovery may be fined and you could be owed some compensation.

Case study:

In this situation, Lantern have made a number of lower offers to the customer which they are under no obligation to do.

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?”
https://forums.moneysavingexpert.com/discussion/5929634/lantern-uk

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 able to make an offer, or you are but you can’t afford it, you’ll need to set up a payment 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 not all the action you need to take.

You can use a debt solution to help you get back in control of your finances.

If you owe lots of money to more than one creditor, you could be eligible for an IVA.

Lantern Debt Recovery Contact Details

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:

Lantern’s opening hours for phone calls are 8am to 7pm Monday to Friday and 9am to 2pm Saturday. They are closed on Sunday.

Lantern FAQs

References

1. Indebted Debt Collection Survey
2. Jubilee Debt Campaign

CONC 7.3 Treatment of customers in default or arrears (including repossessions): lenders, owners and debt collectors

CONC 7.9 Contact with customers