Contacted about debt

If you’re contacted about a debt, firstly check that it’s actually yours and that the amount you owe is right.

Mistakes can and do happen, so whoever is contacting you could have the wrong person or not done their sums correctly.

You can ask the creditor or debt collector for a written statement telling you details about the debt, including what you owe, so you understand exactly what the situation is.

For more information, read our guide on what to do with a debt that’s not in your name (coming soon).

If you get a letter saying you owe money, the creditor or debt collector should give you details including:

• how much is owed
• any extra charges or fees added
• how to contact them

If a debt has been sold to a new company, they should let you know who it was with before.

The new company also can’t add any fees or interest that weren’t in the original credit agreement.

To find out more about what you can do in this situation, read our handy guide.

We should stress that debt collection agencies don’t have the same powers as bailiffs.

So although they can contact you, they can’t take anything from your home or force entry.

If you can’t pay back what you owe, don’t ignore it.

 Instead, speak to who you owe money to, as you might be able to:

• set up a payment plan you can afford
• ask for a payment holiday if you’re struggling

We can take a look at what you’re earning and how much you’re spending, and help you set a budget so you can stay on top of your finances.

Read our guide on how to create a budget to get started.

If you’ve missed payments, your creditor might:

• send you a default notice
• add extra charges or interest
• pass the debt to a collection agency
• take legal action to get the money back

Missing payments could also lead to your credit rating being negatively affected.

If you’ve fallen behind with repayments, it could be worth speaking to a debt adviser who can help you find a solution before the issue gets worse.

If you don’t think you can repay your debt in a reasonable amount of time, you could be able to get a debt solution that writes off at least some of the money you owe.

We can discuss which solutions are right for you and help you find the most suitable way forward.

A debt also wouldn’t be enforceable if you have no contact with a lender about a debt for six years (this is called statute barred).

If that’s the case, the lender could be barred from taking court action to get their money back.

Although this isn’t technically having your debt written off, it does mean you probably don’t have to repay what you owe.

Yes.

If a creditor has been to court to get a county court judgement (CCJ) against you, they can apply for an attachment of earnings order.

This means that a sum calculated by the court will be taken directly from your salary every time you get paid.

Check out our guide on attachment of earnings orders to find out more.

Debt collection agencies aren’t allowed to:

• threaten or intimidate you
• call you repeatedly
• contact you late at night
• mislead you about the consequences of non-payment

If you believe you’re being harassed, then you can complain to the creditor, and if that doesn’t resolve the issue, you could also report them to the financial ombudsman.