What Can and Can’t Debt Collectors Do?

When it comes to a debt collector’s rights, they may differ depending on if the debt is a consumer (personal) debt or business (commercial) debt. The Financial Conduct Authority’s job is to regulate Debt Collection Agencies that deal with consumer (personal) credit collections. There are rules and regulations that control what they can and can’t do. Although there is not regulatory body for Debt Recovery Agencies that collect business debts, they still have guidelines that should be followed.

What Can’t Personal Debt Collectors Do?

• A debt collector is not allowed to talk to another party about your debt without your permission or threaten to do so. This includes speaking to your family, friends or your employer.
• They should not add excessive interest or charges to the original debt.
• Personal debt collectors cannot pretend they have legal powers that. For example, making their letters look like they have come from court.
• At no point should they abuse, threaten, or harass you. This includes excessive calling or contacting you at inappropriate times. It is within your rights to request all interactions and attempts to contact are recorded in writing.
• They should not at any point mislead you into extra payment outside of the contract or trick you into contacting them.

What Can’t Business Debt Collectors Do?

If the creditor has not contacted the debtor for a period of 6 years and no action has been taken on the account, the debt is considered ‘statute barred’. This does not mean the debt no longer exists, it just means it can no longer be enforced by a court order. It can be considered unfair if a creditor or debt collector misleads the debtor into believing the debt is still legally recoverable.

A business debt collector also cannot press for payment after the debtor has stated they will not be paying the money owed- this can be considered unfair practice, and even amount to harassment.

Similar to a personal debt collector, business debt collectors cannot contact you by phone, letter or visit you without clearly stating who they are, where they are from, their role and purpose of their contact.

If this type of debt collector tries to confuse or mislead the debtor through technical language, this is considered unfair practice.

What Can Debt Collectors Do?

Contact

Debt collectors are able to contact you to ask you to settle the money owed, if hired by the creditor of your debt.

They can also contact you via phone call, email, letters or home visits. You cannot completely ignore this if the debt is true, however, you can tell them your preferred method of contact. If you do find you are being constantly contacted without your request being honoured, you can report this to the debt collection agency’s head office so this can be handled appropriately.

Although debt collectors can impose home visits, they cannot enter your home and seize any belongings unless bailiffs with a warrant are present. They must also give you advance warning for a home visit. You are not required by law to speak to or open the door to debt collectors and you can request that they leave.

Adding Interest or Additional Charges to Your Debt

Debt collectors can decide to add additional charges or interests to your debt, but only if there is already an added condition in the original credit agreement. This is why it can be advisable to get in touch with the debt collector to create an agreement or payment plan to avoid additions to your original debt.

If this is not possible, you can attempt to request that your debts be frozen until you are able to pay them.

Applying For a Court Order or a County Court Judgement (CCJ)

Debt collectors can take you to court to obtain a CCJ against you if you continually ignore their attempts to contact you. A CCJ will last for 6 years in your credit history if you don’t settle the debt in 30 days of receiving the court order. Following the court’s decision is crucial to ensuring you don’t give your creditor authority to pursue additional action against you.

If you are dealing with debt and are unsure on how to best deal with your situation, Caversham Solicitors are here to help. Our expert solicitors have experience in a variety of debt collection situations, so we’re equipped to guide you through this stressful time. Contact us today to speak to a professional or request a callback.