Have you received a notice of debt recovery letter in the post? This notice may have come as a shock, or maybe not, but there is a way to respond and exercise your rights in the UK. We uncover the best action to take after receiving a notice of debt recovery.

What Is a Notice of Debt Recovery?

A notice of debt recovery is a letter that requests payment from an outstanding debt in your name. The notice may ask for full payment and possibly administration fees or late fines. 

These letters are also known as a Letter Before Action (LBA), which essentially means they are requesting the payment before taking further action. Further action refers to legal action where the creditor will ask a judge to make the debt legally enforceable (a CCJ).

When the debt has a CCJ to be paid, the people owed the money may then use bailiffs to recover the debt. These bailiffs will likely turn up without notice, but if they do send a letter beforehand, this letter sent by the bailiff could also be known as a Notice of Debt Recovery letter.

Who Sends a Notice of Debt Recovery?

The more agreeable definition of a notice of debt recovery is the one sent by the people chasing you for the money, rather than any court bailiffs. That means the people who send a notice of debt recovery letter are those who you owe the money to directly. Examples include:

  • Landlords and letting agents
  • Utility companies
  • Loan providers
  • Credit card issuers

You might also be sent a notice of debt recovery by a group working on behalf of the company you owed the debt to, known as a debt collection agency. Sometimes these agencies even buy the debt from other companies, meaning you owe them the money instead.

Look out for debt collection scams!

Can a Notice of Debt Recovery Be a Mistake?

If your debt has been sold, you might be shocked to get a notice of debt recovery letter from a company you have never heard of before. Most notice of debt recovery letters are not mistakes, but sometimes they can be.

Some collection companies use a scattergun approach and send out lots of letters for a single debt because they can’t find the correct address for the person who really owns the debt.

Can I Ignore a Notice of Debt Recovery?

Even if you are confident there has been a mistake, it is not advisable to ignore a notice of debt recovery letter. There is a way you can respond to these notifications by using the law to your advantage. Read on to uncover what that is!

How to Respond to a Notice of Debt Recovery

We have put together a simple plan to help you respond to a notice of debt recovery from anyone. Follow these tips to get it right:

Send a Prove the Debt Letter

You might feel like ripping up the letter and putting it in the bin, but it is much better to respond to their claims and request proof that you owe the money (even if you know what debt they are talking about).

The reason for this is simple. Debt collectors must provide evidence that you owe the debt before asking you to pay it. It is not enough to simply say you owe it. They must send you a copy of an agreement you have defaulted on to ask for the payment. 

You can request this proof in a prove the debt letter. The good news is these letters have already been written for you. Just add some personal details and pop it in the post. We recommend using tracked delivery and keeping a record of the letter and proof of posting, in case they take you to court. 

After You Send the Letter

After you send the prove the debt letter, the people chasing you for money could do one of many things:

  1. They might not reply

If they don’t reply then it may be the case that they don’t have proof, send the notice of debt recovery letter to the wrong person or it was a scam.

  1. Ignore future notice of debt recovery letters

They may continue to request payment without acknowledging your request for proof. Or they may not send adequate proof. In this case, retain evidence of your prove the debt letter and you can ignore their notice of debt recovery letters.

If you really wanted to, you could threaten them with a complaint to the Financial Ombudsman for continual harassment (or even make a real Financial Ombudsman complaint)

  1. Pay the debt

If they respond with good evidence that you owe them money, you should look to pay the debt. If you can pay it off in one payment, this is advisable. For larger debts, you might want to consider a debt settlement offer and pay the debt without paying it all back.

What Debt Solutions Are Available?

Not everyone can pay back their debts in one payment. And for these people, there is a selection of debt solutions that can help. There are four main debt solutions for UK debtors, and one of them can even help you wipe more than half of all your debts!

All debt solutions are designed to make repayments manageable, allowing you to get on with life and avoid legal action and bailiffs. 

When You Shouldn’t Send a Prove the Debt Letter?

There is one time when you don’t need to reply to a notice of debt recovery with a prove the debt letter. This is when your debt is not legally enforceable known as Statute Barred debt. Many debts that are more than six years old do not have to be repaid.

In these cases, send a Statute Barred letter instead. Templates of these letters can be found on UK debt charity websites.

About the author

Scott Nelson

Scott Nelson is a financial services expert, with over 10 years’ experience in the industry, including 6 years in FCA regulated companies. Read more
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