Debt collection is a term that strikes terror into business owners and individuals alike.
The image of burly men banging on the door and taking away all your worldly goods hasn’t been helped over the years by the media’s portrayal of debt collectors on TV. However, there are limits to what debt collectors and court enforcement officers can actually do. Knowing your rights is important, so if you’re concerned about that ‘knock at the door’, here’s a brief guide to dealing with the bailiffs.
The difference between County Court bailiffs, HCEOs, and DCAs
The first thing is to understand that there’s a big difference between debt collection agencies (who are usually private firms) and enforcement officers (known as either High Court Enforcement Officers or County Court Bailiffs). Regardless of who comes knocking, there has to be a set chain of events before the ‘bailiffs are called in’.
Initially, there should be plenty of contact between the creditor and the debtor, and the easiest way to avoid any type of debt collection situation is to keep the creditor fully appraised of your situation. If you are a creditor then you should first, try to recover the debt ‘in-house’ or at least negotiate with the debtor to arrange manageable payment plans to pay off the debt. If that fails, then you can take things to the next level by bringing in a debt collection agency.
DCAs often work on a ‘no collection, no fee’ basis, and should go through a process of written contact and phone calls before moving onto personal visits. Bear in mind, though, that DCAs do not have any enforcement authority, so they can’t enter a property to take control of goods in lieu of payment. They also cannot threaten, intimidate or lie to the debtor about what they are allowed to do, and debtors have every right to refuse entry to DCA agents.
Going through the courts
If the use of in-house and DCA methods are still not garnering results for the creditor, then they can go through the courts. The most common route is to apply to the County Court for a CCJ or County Court Judgement. This gives the debtor a certain time in which to pay the outstanding debt, which is usually two weeks. If the debtor still either can’t or won’t pay, then it can be elevated with immediate effect and the court can authorise enforcement.
Who carries out an enforcement order?
It’s usually a County Court Bailiff or a High Court Enforcement Officer who executes the order. The debtor will be told of the decision to elevate the case to the court and that they have seven days to pay before officers arrive at their doorstep. Unlike DCA agents, court officers do have the right of entry and can seize goods to cover the cost of the debt, as long as they are sure the assets belong to the debtor.
Bear in mind that if you are visited by a court officer pursuing a debt, then not only will you have to pay the debt itself, but there will also be additional charges depending on the size of the debt and the actions that the officers have to take to recover the debt. The longer you ‘string things out’, the more you’ll end up paying.
I’m a creditor. What’s my best option?
The cheapest option is a no-collection-no-fee debt collection agency, but as their authority is limited, it may not produce the results you want. If the debt is substantial and you have demonstrated that you’ve given the debtor plenty of opportunities to pay, then the best option is to go straight to the county court and then elevate it to the high court to enforce payment. You will have to pay a fee, but the chances of getting at least some of your money back are higher.
If you’re worried about debt or are concerned that a debt owed to you hasn’t been paid, the best thing to do is to speak to a legal expert who specialises in debt management and recovery.
If you would like more information, please feel free to contact Michael Callaghan on 01245 228136 or via e-mail at firstname.lastname@example.org.