From the other side.....experience of a debt collector

Savvy_Sue

I would just like to stress that the same principles apply to agreeing how to pay off rent arrears, especially with the council or a social landlord. I know less about private renting, but would imagine the courts would apply the same principles. But if you're with any kind of social landlord, always be honest with your Housing Officer. They should help you apply for Housing Benefit and Council Tax Benefit, if appropriate, and many of the problems arise because people find they are entitled to less than expected and have therefore paid less rent direct - sometimes on advice from the HO! And sometimes the problems arise because although HB is due, the tenant has failed to put the claim in at the right time and it can't be backdated. Again, if you are struggling to deal with things like this, please ask for help because it is in no-one's interest - not yours, and not the social landlord's - if the tenancy fails and you have to be evicted!

Work out realistically what YOU can afford to pay towards the arrears, week in, week out, regardless of Christmas, Easter, birthdays, new shoes or clothes for the kids. If it's as little as £5 per week, offer that, start to pay it, and keep paying it! Even if the HO asks for more or says it's not enough, stick to your guns until it goes to court! NEVER pay more, even if one week you can afford it! Salt the extra away where you won't touch it, until the week you can't afford it! IF you miss a week, phone and say why and pay the extra next week, but DON'T miss a week if you can ever possibly avoid it. Remember that this payment is ON TOP of whatever rent you are already supposed to be paying!

Because if it goes to court, and you've paid £5 per week towards your arrears, every week, without fail, never missing, it will be a strange judge indeed who decides that you should be evicted. If your only income at the time is benefits then it is likely that the judge will reduce the amount you have to pay from your benefits, regardless of how much you owe.

Yes you WILL have to declare your income, and if it appears that you could pay more than that £5 per week the court may order you to pay more. If that happens, pay it without fail, every week, as above. Never try to pay it off faster. If your income reduces, go back to the HO and explain: you should be able to get the amount to pay reduced. But do your best to keep paying the agreed amount, and if you can't, then make sure you explain in writing why you can't and what you will pay, and just keep paying!

I don't work in social housing any more, and I was never on the 'front line', but I can confirm that someone who is still frontline has backed what I say here elsewhere. And I know that the most ghastly and horrible thing a HO ever has to do is evict someone for rent arrears, especially a family, especially when the HO has bent over backwards to work with the family to get the situation sorted, and the family for whatever reason has just not been able to respond and do what's needed.

A final note: social landlords will start legal proceedings pretty sharpish if rent goes into arrears. Panic enough to get help at that point, but do not lose too much sleep immediately - it is a long road to eviction, there is help for the tenant along the way, including representation in court. GET HELP quick - with the rent and all your other debts - and all can yet be well.

Lola24_2

I also work for a well known high street bank and have been in debt myself so I know only too well how it feels. From my experience with customers in debt (the worst I've seen was over 55k) the nicer and more honest you are the more help you will recieve from your bank, I think people easily assume banks are there to screw people over and take every penny, but honestly were not! age old saying but honesty is the best policy...!


P.s if you pay only £1 a month to your creditors (after agreeing with them of course!) you are still making payments, so technically you dont have to pay the minimum payment on bills, its not advisable and is only a last resort but I dont think many people know this....

Roger_Rampant

My O/H is out of work therefore no income therefore no payments therefore creditor not interested.

Being out of work shouldn't mean no payments. These organisations are perfectly aware that people out of work receive benefits, anyone should be able to make small regular payments, even homeless unemployed people

No payments means the person concerned can't be bothered to sort their mess out, in reality, and that's why the creditors aren't interested. Not surprising, really...

PaulPPP

A good post Louise and thanks.
My gripe is that people are allowed to amass debt to unserviceable levels in the first place. There seems to be no central reference point to which lenders can refer in order to get an assessment of a borrowers ability to pay back the debt. Credit vetting companies like Experian only seem to record stuff like CCJ's and the like. Half the problem of overstreched debt is irresponsible borrowing, and the other half is irresponsible lending!
My 21 year old son died earlier this year when his van crashed into a tree on a deserted country lane in the middle of the night. As executor of his estate I was astonished to find that he had ammassed creditcard and overdrafts amounting to £34,000! He was a self employed carpenter. Without going into detail, I feel sure that his unfortunate death was in some way contributed to by his financial predicament.
A young person can go shopping in the city on a Saturday afternoon and register for storecards in practically every shop he/she visits - often obtaining a there and then discount on goods as an incentive. If one put one's mind to it one could run up a debt of thousands of pounds in an afternoon. The situation is exacerbated by extortionate interest rates.
There is a need for some central database, which is accessible on-line to authorised lenders, which contains all the current borrowings of an individual against the income and, with a simple formula, gives a simple yes or no to the lender without giving away any personal details.
This surely would benefit all including the credit card companies, the debt insurers and ultimately the general public who in many cases have to pick up the tab for the irresponsible activities of others.
Paul

smudge1_2

hi am very new to this as just registered! interesting posts re debt collection etc. i had a debt of £2ooo on bank credit card and decided in my wisdom to avoid it! stopped opening letters etc,. not the best plan but other probs at time. i since moved rented accommodation (student) and have no longer rtecieved contact re debt. as i never opened mail i dont know if i have a ccj at all, would that be signed for at all? i am now (3 years on ) good with money, working and sorted ish. i went to cab to ask advice as i wanted to contact creditors to arrange payment plan, as long as would not include 3 years of interest as i cant afford that. cab couldnt help at all, had no idea who would now have debt and said they had never come across this situation before, as i have moved again and have since obtained a mortgage and credit card. i still worry about this old debt, has it been written off possibly? feel like an accidental master crook! any advice/info please!

NannyP_2

ms_london wrote:

Thanks Louise1234 for an interesting post.

Although i have only experienced it from the side of the one who is in debt, I still have to say I completely agree with you.

When I was honest with my creditors, they did their best to help me - so long as I made my repayments when I said I would. After a year of proving to my bank that I could still to the agreed repayments (after I had defaulted and not made any payments at all originally), my bank offered me a loan to cover re-finance my original loan with them, and my overdraft - and they kindly offered it to me with an APR of 2.3%, yes 2.3%!!! So for that i am eternally grateful.

Interesting post. Good to hear things from both side of the fence.

Ms_London

Just wanted to say well done, it must have been hard

Apple_2

Roger_Rampant wrote:

Being out of work shouldn't mean no payments. These organisations are perfectly aware that people out of work receive benefits, anyone should be able to make small regular payments, even homeless unemployed people

No payments means the person concerned can't be bothered to sort their mess out, in reality, and that's why the creditors aren't interested. Not surprising, really...

Complete b******s.

O/H is more than 'bothered' - he's scared to death.

Since O/H is self-employed ( but wasn't working then ) he is not entitled to benefits. Nil - nada - nothing. But obviously you know the benefits system better than the staff there.

I'm the sucker who's been paying all the bills while this was going on so I know that he had nil income.

Every thought of being a debt collector ??? You've got the right mind-set.

rosepink

Good post about debt from the other persepctive. I am a retired CAB worker. I have not noticed any comment about asking creidtors to freeze interest . This is something we always tried to sort out for clients as it gave them a chance to make payments. I was always rather gratified at the response of creditors to the information that CAB was now involved. As long as clients could work with our strategy of not getting further into debt we could really help them. Sorry to anyone who has had a long wait at a CAB but it is usually worth it. We always checked benefits to and very often found mistakes in calculations. Good luck to all who are working to get back on track!

ducky2004

According to the Limitation Act, if they no CCJ is registered for 6 years since the debt of which you last make a payment on, then the debt disappear. If CCJ is registered, then they can enforce it and the CCJ stays in your credit file for 6 years. In reality, I guess, people just write off the debt after a few years of futile attempts to locate you.

To find out, get a copy of your experian credit report - it will tell you if you have got a CCJ recorded. It will also show any default - which then you can contact the lender to offer payment if you wish.

Another regrading debt collection agency - I recently tried to help a friend whose credit card was stolen (she was out of the country for many months, the bank sent the card to her old address and was stolen. The bank then passed the debt to the debt collection agency (MERCERS), they wrote a fairly agreessive letter and then provided a fax number that does not work (keep ringing). In the letter, I feel that the only thing they are interesed is pay now without giving any opportunity to make a defense against the alleged debt.

I definitely support a central database to know how much people have borowwed - preferably a grand total so that other personal info re not revealed. The current system do show up your debt but has a serious lag time - it can take up to 1 month for these to be recorded at Experian DB.
So, a young gentleman/lady who goes out and try to obtain 100 store card in an afternoon or apply 100 credits will probably get away with it.

smudge1 wrote:

hi am very new to this as just registered! interesting posts re debt collection etc. i had a debt of £2ooo on bank credit card and decided in my wisdom to avoid it! stopped opening letters etc,. not the best plan but other probs at time. i since moved rented accommodation (student) and have no longer rtecieved contact re debt. as i never opened mail i dont know if i have a ccj at all, would that be signed for at all? i am now (3 years on ) good with money, working and sorted ish. i went to cab to ask advice as i wanted to contact creditors to arrange payment plan, as long as would not include 3 years of interest as i cant afford that. cab couldnt help at all, had no idea who would now have debt and said they had never come across this situation before, as i have moved again and have since obtained a mortgage and credit card. i still worry about this old debt, has it been written off possibly? feel like an accidental master crook! any advice/info please!

Roger_Rampant

I'm the sucker who's been paying all the bills while this was going on so I know that he had nil income

Pity you weren't willing to let him have a fiver a month to pay them, and preferred to leave him "scared to death"