Dealing with debt collectors
The following relates to if a person is unable to keep up their monthly payments and chooses a debt management plan as a solution to their financial difficulties.
If you have taken out a loan with a creditor and found yourself in a position where you are unable to keep up with the agreed monthly repayments, and no repayment proposals have been made with your creditor, the outstanding debt could be passed over to a debt collection agency.
Creditors generally follow standard procedures when someone defaults on their payments. They will initially send out letters informing you that a payment has been missed and request that you to make that payment immediately.
If the creditor receives no response, they could then place a default on the account and send you a default notice which in effect means that the repayment agreement set in place has been breached and recovery procedures will commence.
Once a default notice has been sent, if the creditor still receives no response, the next stage may be an application for a County Court Judgment (CCJ).
In the meantime, you will still receive letters and telephone calls attempting to recover monies from you as the creditors are legally entitled to chase the outstanding monies.
Many people worry about contacting their creditors when they find themselves in financial difficulty, as they are concerned about what might happen to them and how the creditor will treat them once they become aware that the repayment agreement can not be honoured.
This is the reason why many people find receive CCJ’s.
In order to prevent court action, the best way forward is to always contact the creditor informing them of your situation so that an affordable repayment can be arranged.
If you are worried about contacting your creditors yourself, you can appoint a third party to do this for you who can negotiate repayments on your behalf.
When making repayment proposals to creditors, it is important that all creditors are aware of your total monthly outgoings, including all creditors you owe monies to so that they can see you are offering a fair percentage of what you can afford to each creditor.
Once you have worked out how much you can afford to split between your creditors each month, you can appoint a third party company to make that payment to who can then distribute those payments on your behalf.
The payments would generally continue until the debt has been paid.
Call our specialist debt team on 08000 915 004 to find out how we could help you.