25 Feb 2020

What rights do debt collectors have?

If you owe money and stop making payments, you may be approached by debt collectors. Their job is to retrieve the money you owe on behalf of the company that hired them. While they’re meant to abide by certain rules when they approach you, it’s not always clear whether or not they’re overstepping the line with their actions.

In this blog, we look at what debt collectors can take from you, how far they can go with settling the balance you owe, how they compare to bailiffs, and myths behind what they’re allowed to do and how much authority they have.

What is a debt collector allowed to do?

When a debt collector is chasing a payment, there’s a fine line between doing their job and overstepping the mark. Debt collectors and bailiffs (now officially called enforcement agents) are easy to confuse with one another, but the crucial difference between the two is that bailiffs have special legal powers to collect debts, while debt collectors don’t. In fact, debt collectors have no powers beyond asking you to pay the money they claim is due. There is nothing they can do to make you pay other than writing letters and making phone calls to you.

Some debt collectors are often incorrectly referred to as bailiffs, and just because a debt collector has visited your home, it does not necessarily mean that they are a bailiff or possess any special powers. However, it’s possible to identify whether or not a bailiff is who they say they are, as all bailiffs must carry special documentation from the court to verify their identity and what authority they have.

The limitations of what a debt collector and a bailiff can do are similar in certain areas. For instance, although bailiffs are allowed to regularly remind you about the required payment, call you about it (providing it’s a reasonable time of day) and request help from a court, there are plenty of things that both they and debt collectors can’t do and that actually could be considered harassment. These include:

  • physically or verbally threatening you
  • ignoring claims that you don’t owe them money
  • requesting a payment through social media platforms such as Facebook and Twitter
  • contacting you at unreasonable times such as early in the morning or late at night
  • persistent calls or other contact when you have asked them not to
  • urging you to take out more credit or sell your home in order to pay off the debt
  • making false claims about police action being taken against you or wrongly implying that court action has been taken against you
  • sending you or presenting false documentation to intimidate you or force you into making a payment, or implying that they work on behalf of a higher power
  • hiring additional debt collectors to chase you for payments
  • forcing you into paying larger instalments or paying all the money off when you can’t afford to
  • attempting to humiliate you in public in an effort to intimidate you
  • sending messages to you via family, friends or neighbours.

As mentioned above, bailiffs are appointed by the court following other legal action and possess special legal powers of enforcement, meaning they have the authority to do more than a debt collector is able to do. Unlike bailiffs, debt collectors aren’t court appointed and they’re not able to enter your property and take possessions to repay the debt you owe, so it’s actually you that holds the power if the company you owe money to gets a debt collector involved.

You will need to tread more carefully if the person contacting you is a bailiff, but you still have rights and are not powerless. If you are approached by someone claiming to be a bailiff or a debt collector, you should ask them to prove their identity and should not pay them anything until you are satisfied that they are who they say they are. No bailiff or debt collector should act in a way that is threatening or intimidating while you verify their identity.

What can debt collectors take?

If you’re being chased for a payment by a debt collector or bailiff, it can be concerning to think of what they may or may not take from you in exchange for some of the debt. They cannot take anything from you without your consent unless they have a court order called an enforcement order. It’s unlikely that they would have this without you knowing about it, and if they claim to, you should ask to see it.

Even with a court order, there are some things that are clearly stated as being out of bounds, such as basic domestic necessities like a table and chairs, beds and bedding, kitchen appliances, mobile phones and important medical equipment or medicine. A court will not allow debt collectors or bailiffs to take anything which may be essential for you to carry out your paid job. For example, if you were a self-employed handyman, they wouldn’t be allowed to take your work van or tools.

A bailiff cannot enter your property without an invitation, and if you feel threatened or intimidated, you are well within your rights to refuse them entry. Bailiffs cannot take your property without further order of the court. Before the court grants any order, a bailiff will be appointed to assess the value of your goods, and the court will only allow them to take goods to satisfy what they claim is due. Only bailiffs can be appointed to act on the order of the court.

Can debt collectors take money from your savings account?

As part of what’s known as the ‘right to set-off’, banks are able to take money out of any accounts you have with them, including savings and current accounts, to pay off any debts you have with them. This also applies to any debts they’ve temporarily paid off on your behalf, and they’re able to do this without your permission.

Debt collectors can only take money from accounts held by the same bank, but they cannot take money from any other account. If you’re behind on mortgage repayments, they can’t use money from your account to pay off mortgage arrears, but they can demand a repayment at any time and reduce your overdraft limit.

Can debt collectors take pets?

A worry for many people who are being targeted by debt collectors after failing to make the necessary repayments is whether their pets will be affected. Debt collectors aren’t able to take pets from you, and the same applies to guide dogs.

Can debt collectors take your home?

The thought of losing your home can be a massive concern, and if you’re having money troubles, it may be one of the first things that you worry about. In reality, it is very difficult for a creditor to take possession of your property and this would only be used as a very last resort.

Permission to take possession of your property can only be granted by the court. The creditor will need to make an application to the court for possession and you will have an opportunity to defend this application and ask that the order is not granted. There are a number of points that the court will take in consideration and may be used to defend any application for possession, such as:

  • any equity in the property and whether all outstanding charges are likely to be satisfied (to work out the equity in your property, take away any outstanding mortgages or other monies secured against the property from the current property value)
  • if there are young and or dependent children living in the property
  • ill health or disability which may make it difficult and impractical for you to live elsewhere
  • if you expect your circumstances to improve.