What is a debt collector/agency?
It isn’t uncommon for lenders to pass your accounts to debt collectors or collection agencies. This is because although companies are good at lending money and getting your payments each month, dealing with unpaid accounts is not their forte.
Your accounts are normally passed to debt collectors when you have been behind on payments for quite some time. Put simply, their job is to take the pressure off the lender and attempt to collect the balance for them.
This can work in two ways, the collectors can act on the company’s behalf, or they can take over the debt completely. However, once it has been passed, the original company won’t contact you for payment at all and you will deal only with the collection agency.
What can debt collectors/agencies do?
Despite how they sometimes portray themselves, debt collectors don’t have any special legal powers. They can only follow the same procedures as the original lender.
This means that they will generally contact you by phone or written letters, although it has been known for them to threaten court action. They can also sometimes threaten to send an agent to your house, but they are not the same as bailiffs and cannot take your belongings.
If you do not pay the debt collector, they can take legal action against you by applying for a County Court Judgement (CCJ). As such, it’s important that you contact them and work with them to come to a solution to pay back what you owe.
What can debt collectors/agencies not do?
Debt collectors can send agents to your house, but they cannot come into your house unless you say so, and they cannot take anything you own. You’ll usually be sent a notice to warn you of their visit so it’s best to contact them beforehand to prevent them appearing at all.
If someone does turn up at your door to collect the debt, it’s important to remember that they aren’t allowed to demand immediate payment from you. They also need to show you their ID as proof of who they are; if they don’t, you don’t have to tell them anything.
It’s also important to never make any payments to them in cash as this will likely be a scam. If you feel they aren’t going through the right procedures or that they’re harassing you, contact the agency they work for and make a complaint.
What rights do debt collectors have?
If you have been sent a notice for a visit from a debt collector, it’s important to know what rights they have so you know what’s acceptable and what’s not.
Unlike bailiffs, they do not have the right to force entry into your house nor can they ask you to make an on the spot payment. They’re required to show your ID when they arrive, and if they don’t then you have the right to refuse them any information.
We advise to never make any cash payments to a debt collector to avoid being scammed. It’s better to set this up with the lender directly once you have worked out how much you can afford to pay them.
If you feel uncomfortable dealing with them in person, then you can ask them to leave. You can then contact them in writing or over the phone to arrange a payment plan after they have left.
Debt Collection Agency Directory
The biggest and most commonly used collection agencies are Moorcroft Debt Recovery, Lowell, Robinson Way and Cabot Financial. But this is only a select few of the many that exist out there.
So, if you’ve been contacted by a company and you’re unsure what they do, use our directory. All you need to do click on the company name to find out more details: