I spend a lot of time dealing with debt collection agencies. The reason for this is that I decided to set up and manage my own Debt Management Plan.
You get used to dealing with debt collection agencies after a while. A common theme when calling a debt collection agency is this: –
This is the Debt Collection Agency, please may I take an account reference?
Can I confirm your name address, date of birth and telephone number please?
Yes, and I provide the details.
Thank you Mr Debtor, I can see you have a balance outstanding of £1000 are you in a position today to make repayment?
Lol. No, I wish I was but if you look at my income and expenditure I sent you, I am sure you will see I have no extra money.
Ok what can I help you with then?
Typically, I only ever call a Debt Collection agency when I absolutely have to. Instead I prefer to talk to them using e-mail or old-fashioned post.
Not that I am scared of talking to them, it is just easier for me to keep written records of what has happened. You can usually find their contact information using Google. That’s how I normally do it anyway.
Priority or none priority debts?
I only have none priority debts which are less serious than priority debts.
If you are dealing with priority debts then I would recommend seeking help. You can see some examples of priority debts on this blog.
However if you are dealing with none priority debts like myself, read on. None priority debts are things like credit cards, unsecured loans, payday loans and store cards.
Dealing with new Debt Collection Agencies?
Ok so let’s consider this, you have received a letter demanding repayment in 14 days otherwise they will take you to Court, get a CCJ and ultimately make you pay more than the original balance due to court costs and interest.
I am quite confident enough to call them and discuss the account because, I have a lot of experience with doing so, and I also enjoy being told that they can do certain things when I know full well they can’t.
Basically this form is just a list of all your payments, for example rent, food and child care costs along with information about your other debts.
This would include the balance outstanding and how much you can offer to pay them. It should also include details of any income you receive. You don’t have to send this information unless requested by a Court but it will make your life much easier if you do.
Post the information using recorded delivery so you know it got there. You should find that most of the time you will receive a letter back advising your repayment offer has been accepted, and the arrangement will be reviewed every six months for example.
Dealing with existing Debt Collection Agencies?
So long as you keep paying on time it is unlikely you will hear anything from them. The only time you may hear something is if: –
- You missed a payment
- The account has been passed on to another agency
- They are reviewing your repayment
What if you have missed a payment?
Don’t worry, if you genuinely could not afford to repay them due to some unforeseen circumstances you should contact them as soon as possible.
Preferably do this before the payment is due and usually the arrangement can be reset. I have done this on several occasions.
I just start from the beginning sending a repayment offer and income and expenditure details along with a quick explanation of why I defaulted on the agreement. For example, I didn’t earn as much that month or I had an unexpected expense.
Learn from this and adjust your income and expenditure if you have to even if it means paying less, it is better to have a payment you can afford being made on time than one that is unaffordable and is regularly missed.
What if the account is passed on to another agency?
If the account has been passed on to another debt collection agency don’t worry. The whole process just starts again. You will receive a letter demanding payment.
Just send another letter back to the new company with your repayment offer and income and expenditure details. As before most of the time you should get acceptance and can continue to make repayment.
Just remember to update your standing order so it goes to the new company.
What if they want to review my payment?
Again send the company a letter explaining your circumstances have not changed since the last time and include your income and expenditure along with the offer of repayment. My experience is that the arrangement will be reset again for another six months.
What if the agency does not accept my repayment?
Unfortunately, when you are in an informal arrangement to pay they don’t have to accept it. You should make payments anyway but they could still take you to Court. If you are struggling then please visit the Debt Help section on this blog.
If like me you are not concerned and have been there before then you would just complete the Court paperwork with your income and expenditure information and other debts. The Court will most likely accept your repayment and then it becomes official.
You should not miss the Court ordered payment as further things could happen such as: –
Attachment of Earnings Order
This is where an order is sent to your employer asking them to deduct the repayment directly from your salary.
Charging order against your home or land
If you own your own home a charging order could be made against your house which means you could lose your home. The same applies for if you own any land. You can try to defend this and I would recommend seeking help.
A Warrant of Execution
A Bailiff could be instructed to remove goods from your home in order to repay the debt.
A third-party debt order could also be used
This is where money in your bank or savings account could be frozen in order to repay the debt.
If you get a CCJ, make sure you don’t miss a single payment! A CCJ is classed as a priority debt.
So far I have avoided a CCJ because I have been making regular payments to my debts. However if you don’t then it is likely that a CCJ could be entered against you.
This is why it is so important to face your debt problems head on. No matter how bad they seem there is usually a solution and free help is out there to get you back on track.
How do you deal with Debt Collection Agencies? Do they intimidate you or do you take them in your stride?