Did you realise that many debts are legally unenforceable?  Take a careful look at this - it may just help you!

So what do I know about this? From 2000 until 2005 I held a Consumer Credit Licence and did some work as a debt counsellor. I was shocked to see the tactics used by supposedly reputable money-lending organisations to frighten people into paying amounts they couldn’t afford. I was even more shocked to discover large debt counselling companies, to whom people suffering severe hardship were paying monthly fees, were actually making deals with lending companies. One lender was almost unbelievably connecting customers to a debt counselling company through their own switchboard! But these revelations are for another occasion.

The aim of this page is not exactly to take advantage of a “loophole”, but more to ensure that collecting companies know they should correctly document an account before getting any money.

But first of all, my legal disclaimer! Please understand that this page is not qualified legal advice. If you choose to take action based on the following information, you are solely liable for the consequences. You may wish to consult other professional bodies before doing anything about your debts.

Not paying your debts will affect your credit rating and could stop you from borrowing in the future. But you wouldn't be wanting to do this anyway, would you?

This advice applies only to unsecured borrowing (for example: personal loans or credit cards), for which you do not have a CCJ (County Court Judgement). The lenders and collectors of these accounts tend to shout louder and send more intimidating reminder letters, simply because they have everything to lose. Accounts are often sold or “contracted out” to debt collecting companies who use letters, telephone calls and even doorstep collectors to frighten you into paying. But these agencies are actually the weak point, usually because they do not have your account properly documented.

If you are under pressure from these organisations, even if they are threatening Court action, you should never pay amounts that mean you cannot keep up with Council Tax, mortgage or rent, secured loans, hire-purchase agreements or utility bills. These are subject to different legislation and must be paid.

If a collecting company want to take formal legal action against you, they have to produce certain documents to the Court. They also have to pay a fee to the Court (this can be up to 10% of the amount they are claiming from you). You should challenge them to produce these documents to you first. If they fail to do so, you should refuse to pay.

If you are receiving threatening letters, take the following action.

STEP 1.
Make sure your wages or benefits are being paid into an account with a bank to whom you do not owe any money.

STEP 2.
Stop paying the unsecured creditors. Contact your own bank to cancel any Direct Debits or Standing Orders to them.

STEP 3.
Wait until you receive a reminder letter, then send the “Data Request” letter to them. This can be downloaded by clicking the link at the bottom of this page. The downloaded file contains the Data Request letter and instructions on how to fill it in and send it. Print it out and follow the instructions carefully. Make sure you send it by recorded delivery.

STEP 4.
Before the debt can be enforced, the collector must send you the items requested:
  a) a true copy of the Consumer Credit agreement you signed
  b) statements proving the exact current balance of the account
  c) a true copy of the Deed of Assignment (but only if the collector is not the firm that originally lent you the money).
If they attempt to take you to Court, they should submit these documents with the Court fee before the Court will issue you with a summons.

STEP 5.
In the majority of cases, these documents cannot be provided. The more “decent” collectors will write to inform you that the debt is written off. The others usually go quiet. Don’t try to contact them.

STEP 6.
In the unfortunate event that they succeed in providing the documents, you should then start to negotiate a (very) reduced monthly instalment.

USEFUL TIPS
Never discuss your accounts over the telephone. If a collector calls you, simply tell them to write to you. Be firm on this point and keep all letters you receive, as well as copies of any letters you send to them.

FACTS AND FIGURES
I have monitored nearly 30 accounts held by various people who have used this Data Request. So far only one lender (not a collecting agency) has managed to supply the documents and I have seen almost £100,000 of debt written off.

FEEDBACK REQUIRED
If you use this method, please CONTACT ME and let me know how you get on.

CLICK THIS BUTTON to download the DATA REQUEST LETTER and INSTRUCTIONS to your computer. (This is a Word file).

PLEASE NOTE: It has come to my attention that some rather dubious companies are actually charging people for the information on this page. The Citizen's Advice Bureau and several Government officials have condemned this practice. If you are certain that you owe money to a bank or credit organisation, only you can decide if this is morally the right thing to do. But if you have any doubt at all about the exact amount you owe, you should certainly demand proof. And as I am not charging for this information, the C A B and others cannot complain. Remember this is a PERSONAL website!