Different types of debt collectors have differing powers for dealing with debt. A debt collector is not court-appointed, so what authority do they have and what can they do ‘legally’?
The courts only appoint official debt collectors (e.g. a bailiff). At no time should regular debt collectors give the impression of having the same powers of bailiff enforcement agents.
Bailiffs can ultimately seize goods to sell on, whereas debt collectors cannot. An exception may apply if they are working on behalf of a government agency.
In most cases, debt collectors work for a debt collection agency. They may also be a private individual hired by the person or a company that has a debt owing to them.
There are several things to be aware of before taking evasive steps to deter or delay a debt collector (or the payment of debt). The creditor has entitlement to add interest to an outstanding debt. They can also add reasonable costs incurred while trying to recoup their money. Thus, any form of delay could cost the debtor an extra amount added to the debt.
Power of a Debt Collector Chasing a Basic Debt
In fact, the limits of debt collectors powers are akin to those of a creditor. You would be able to ask the debtor to pay up but you should always get advice about debt before taking action. The powers of debt collectors do not grant them legal entry into your home or the seizure of goods. In simple terms, their rights only allow them to ask for the payment of a debt owed to a creditor.
In doing so, they would have the authority to make a visit to your home. Debt collector can also make calls to your phone or write to you – requesting payment. But, they are not allowed to use any method of force or harassment. As such, they are subject to the rules of the Financial Services Authority (FSA) on how they can pursue you.
At first contact, the debt collector will have to show you who they are collecting the debt for and exactly how much it is. But, saying you cannot, or will not, pay means they must not threaten you in any other way. Even so, they can inform you that failure to pay may involve further costs if the creditor decides to take out a court summons.
Buying Debts from a Creditor
It is not uncommon for debt collectors to use legal methods to buy a debt from a creditor. In this case, they would be trying to collect money owed to themselves. Nonetheless, the rules on debt collection remain the same. Debt collector powers limit their authority to persuasion, but very little else.
If true, the debtor must accept that they do in fact owe money to someone. Ignoring the situation rarely prevents the problem getting worse and usually ends up involving court action.
Debt collectors can only used methods to persuade you, meaning they must be civil and non-threatening. They are not empowered to take anything from your home, nor list anything for possession.
Debt collectors cannot attach any sticker or paperwork to any of your goods either in your property or within the property boundary. They cannot wheel-clamp your car, even though a bailiff might. If a debt collector refuses to leave your property when you tell them to, they would be causing harassment and trespassing.
Note: A debt collector is pretty much confined to the ‘powers’ that any creditor would have if they phoned up asking for payment themselves!
Debt Collectors Powers of Persuasion
A debt collector has no way of taking money from you, other than by asking for it. There are no ‘back-up’ actions or threats they can use within the law. Thus, the powers of persuasion are their only choice. It has to be persuasion – and not any kind of physical or verbal threat.
Collectors cannot instruct any other agent or bailiff to collect debts on their behalf. Neither should they pretend, or act like, they have any powers of collection for the seizure of goods.
It would not be uncommon for debt collectors to use illegal bluffing or suggest what further actions they may take. But, these kind of bluffs should not be harassing. They can call again, or contact you by phone or letter, but there should not be any form of intimidation.
Debt collectors powers do not allow them to discuss the circumstances of debt with neighbours or with friends of the debtor. In no way can they discuss debts with your employer or the staff at your bank.