Debt Collectors

[Spanky Deluxe]

Has anyone had any experience with hiring debt collectors? My ex flat mate owes me several thousand pounds in unpaid rent. He'll be signing a contract to pay it off in weekly/monthly installments tomorrow, he got behind by his business going to pot and is now trying to rebuild. I let things get really bad but the situation was very complicated. The value is above the small claims courts and he doesn't own anything near the amount of the debt. I set him up on a payment plan before and he ended up defaulting and cancelling the standing order. This time around I really want things to be different. I will be calling up his mother and letting her know exactly how much it is he owes me (she's asked me before but I've never let her know) and I would really like to have a backup option.
Some friends recently said to me that you can get a debt collection agency to basically take the debt on and deal with it themselves. They give you something like 80% of the debt and then you don't have to worry about it anymore. That's what I've heard, is this true at all?
I head back to Uni next week and so won't be around to hassle him, chase him and generally deal with him. In the past, if he's missed a payment while I've been at University, he simply hasn't answered his phones making it impossible to get hold of him. This has caused me a huge amount of stress in the past and I really can't deal with that in my final year now. If there's a company I can pass the debt on to who will pay it off or whatever then I would be very tempted to do so.

Any help would be greatly appreciated!!

Spanky

 

[iGav]

Some friends recently said to me that you can get a debt collection agency to basically take the debt on and deal with it themselves. They give you something like 80% of the debt and then you don't have to worry about it anymore. That's what I've heard, is this true at all?

I'd almost certainly say no, at least not without going through some type of legal proceedings to establish that the debt is valid, giving your the right to then hire debt collectors to recover the amount owed.

But even then, I can't imagine a Debt Recovery Service would be willing to take that risk, when your 'friend' could quite easily go down to his local court, pay £500 and 30 minutes later be made bankrupt, which would absolve him of any of his financial debts.

Haven't you sought legal advice yet?

 

[Allotriophagy]

Are you sure the value of the debt is too small for the small claims track?

http://www.moneyclaim.gov.uk is an online service which is EXTREMELY easy and cheap to use. The limit on claims is £100,000. If the debt is purely rent, I do not see how it could be that high.

All you need is the address of the debtor.

This page has lot of detail and help.

Though it seems to me that you just want to get something back ASAP and wash your hands of the situation?

Googling for debt collection agency turns up a lot of results. Take a peek and contact one of them.

 

[Spanky Deluxe]

Yeah I do really want to stay out of court because I know he can either be written off as bankrupt in which case I get nothing or he goes on a silly payment plan of £10 a month, which would take about 67 years to pay it all off. I'll have to chat to him later and see what happens. I'll at least threaten to take it to some debt collectors and I will speak to his mother as well about the matter. It really isn't an amount to be sniffed at.

 

[Lau]

It might be worth going and having a chat with the local Citizens Advice Bureau — I've known a few people get some great advice from them.

 

[aricher]

Swinging a pillowcase full of batteries or bars of soap might do the trick. At least that's how I've seen it done in the movies.

 

[iGav]

I'll at least threaten to take it to some debt collectors and I will speak to his mother as well about the matter. It really isn't an amount to be sniffed at.

I wouldn't threaten anything... if you put him in a corner, he'll declare himself bankrupt, and you won't get a penny back. Then within 12-24 months he'll be back on track credit wise again, and you still won't have your money... it'll achieve nothing.

I also wouldn't discuss it with his mother if he's over the age of 18, you could potentially be opening yourself up to legal action from him further down the line, that and it has nothing to do with her.

Personally I think your options are at best limited, you said so yourself that the posessions that he does have do not make up anywhere near the value of the debt, which itself makes contacting debt collectors less viable, because even if he defaults on his repayments, then their Bailiffs won't be able to take anything of value to reduce the debt.

Also if he's defaulted on a repayment, then the likely hood is is that he cannot afford them, meaning that if he's put under further pressure from a Debt Recovery Agency, he'll likely just have himself declared bankrupt anyway.

The way I see it is that your only option is to come to an agreement on what he can afford to repay a month, too high and he won't be able to consistantly afford to make repayments, too low and as you say... it'll take a lifetime to repay, you need to find a middle ground.

Either way, I wouldn't threaten him... because you have everything to lose.

 

[aristobrat]

Some friends recently said to me that you can get a debt collection agency to basically take the debt on and deal with it themselves. They give you something like 80% of the debt and then you don't have to worry about it anymore.

I'm in the US (so I know this doesn't directly apply), but just did exactly what you're talking about.

In exchange for a promissory note, I loaned someone a decent chunk of change. He made monthly payments for 2 years before he decided he didn't want to pay anymore. It wasn't that he was broke, ... he just rather spend the money for more fun things.

A local law firm here specializes in debt collection, so I made an agreement with them for them to collect the debt. They took him to circuit court and the judge ruled in my favor. This guy now has a lein in the state of Virginia.

A week or two before the court date, he skipped the state and now lives in Georgia, so the law firm will pull his credit report quarterly to see if they can figure out where he's working at. If so, they will get a judgement in GA and garnish his wages.

When that happens, he'll either let them continue to garnish his wages, or he'll file bankruptcy. If he does file bankruptcy, I can write off a small percentage of the debt with my taxes.

Either way, I'll see some of the money eventually, and in the mean time, I don't feel as helpless as if I were sitting around waiting for the perfect situation to come around where I could magically convince him or his family to start repaying the note.

The only thing I've paid out-of-pocket so far has been the cost of trying to serve him with papers, and the quarterly credit checks.