Manchester, UK (PRWEB UK) 1 November 2012
Gregory Pennington, one of the UK's largest and longest-established debt management companies, has created a fact sheet to help borrowers understand their rights and responsibilities if a debt collector gets in touch.
The 'When the debt collector calls' fact sheet contains a range of information designed to help borrowers deal with a debt collector - whether that's on the phone, by letter or face to face. It explains, in straightforward terms, what a debt collector can and can't do, with a step-by-step flow chart on dealing with debt collectors and some interesting facts and figures about debt collection in the UK.
The fact sheet aims to answer the most common questions about debt collectors, as well as clearing up the difference between debt collectors and bailiffs. If you have any questions that haven't been answered, you should talk to an expert to find out more.
There are more than 600 debt collection firms across the UK, employing over 14,000 people. At the end of 2011, the overall value of unpaid consumer debt held for collection by members of the Credit Services Association (CSA) - the UK national association for debt recovery agencies and allied professional credit services - stood at more than £58 billion. This figure marks a rise of more than £6 billion in just six months.
According to Bank of England figures, outstanding consumer credit in the UK stood at £156.5 billion in August 2012. Looking back to December 2008, when this figure stood at £233 billion, this shows a considerable fall over nearly four years.
Even so, Credit Action calculates the average household debt in the UK (excluding mortgages) totalled £5,949 in August this year.
In the current financial climate, with the continuing effects of the recession and rising living costs squeezing many people's finances, the risk of facing debt problems - and getting a call, letter or knock on the door from a debt collector - could be higher than ever.
Borrowers who don't make their debt repayments for a number of months could find themselves being chased by a debt collector for the money they owe their lenders. Debt collectors are usually employed by lenders to recover unpaid debts - although in some cases, lenders will 'sell' the debt on to a debt collection agency.
But debt collectors only have the same rights as your lenders, and aren't the same as bailiffs - who have 'special' legal powers granted by the courts. So, it's important to know exactly what your rights are if a debt collector contacts you.
A spokesperson for Gregory Pennington commented: "If a debt collector gets in touch with you about any outstanding debts you have, it's important you know exactly where you stand - and what they can and cannot do.
"Debt collectors can only talk to you about repaying your debts and try to arrange an affordable repayment plan with you. They're not bailiffs - and cannot pretend to be - so they can't enter your home unless you want them to, or take away any of your possessions.
"A debt collector can only turn up at your door if they've given you prior notice, and if they do, they must provide proof of who they are and what debts they've come to collect. If the debt is yours and you can realistically afford to make payments, you should agree a repayment plan with the debt collector. And don't forget to get proof of any agreements in writing.
"On the other hand, if there's no way you can repay the debt, explain your situation to the debt collector - and ask them what legal action they can take if you don't repay it. Debt collectors are actually prohibited from threatening you with action they know they cannot take. And keep in mind that under no circumstances can a debt collector harass you."
Notes to editors
Gregory Pennington currently helps around 50,000 people repay their debts through its Debt Management Plan. The company is part of the Think Money Group, one of the UK's leading financial solutions providers.
Gregory Pennington is a founding member of DEMSA, the Debt Managers Standards Association, which was established in 2000 'to promote good practice in the debt management industry'. DEMSA's code of conduct has received Office of Fair Trading approval, under its Consumer Codes Approval Scheme.
For more information, visit the Gregory Pennington website at http://www.gregorypennington.co.uk
Melanie.Taylor (at) gregorypennington (dot) co (dot) uk
Tel: 0845 056 6480