Mr A asks:
I have had an arrangement with a debt collector for a number of years, paying £10 a month.
They have sent a letter asking for a review.
Do I have to do this? Can they do anything if I just continue with my current payments?
Contents
You don’t have to give these numbers but…
It is a good idea to give revised details
Everyone was happy when the arrangement was set up.
Mr A was relieved this debt was “sorted” in a way he could afford.
The creditor was getting some money and knew Mr A was paying a fair amount.
A few years later, Mr A is still happy, he doesn’t mind carrying on paying this. But now the creditor is wondering if Mr A can pay more.
This may feel unfair – you have kept your side of the bargain, why does the debt collector want to change it?
But this sort of arrangement is not a formal long-term contract. It is just a temporary agreement with the creditor to accept less than the original contract said because you were in financial difficulty.
You don’t have to send them a new Income & Expenditure (I&E) form. They can’t make you!
But if you don’t, they may think you do have more money … in which case they may decide to start adding interest again (that is most likely with the original lender) or take you to court for a CCJ (that is most likely with a debt collector).
So it’s better to give them your revised income and expenditure details.
Make sure your numbers are up to date
It’s worth thinking about what your expenses actually are – it’s easy to miss off things if you don’t budget in detail. And inflation has been pushing up a lot of expenses.
So make sure you have the new energy bills, council tax, mobile bills etc. And probably a much larger amount for food than when you first set up the agreement.
Using an online tool such as National Debtline’s My Budget can help you to get a full list. You can also download the Inome & Expenses from there to show your creditor if you want or just use the numbers to complete the debt collector’s form.
Do you have arrears of important bills? Or may you have soon?
If your situation is bad, this is your chance to ask for your payments to be reduced, not increased.
In particular you should highlight to the creditor if you have arrears on any priority debts such as rent, council tax or energy bills. Or if you know there are big problems ahead eg when you mortgage fix ends later in the year.
Here you should ask for your current payments to be reduced so you can clear the arrears. This could be down to a token £1 a month payment.
I am in a DMP – do I still have to do this?
Some people prefer to use a DMP firm as it means making only one payment per month and not having to deal with their creditors directly. A debt management plan run by a DMP firm is essentially a series of debt arrangements made with creditors.
In a DMP a creditor won’t usually ask you to send them a new I&E.
But if one does, just send the letter to your DMP firm – it’s their job to deal with it!
Your DMP firm will do an annual review with you. This will include doing an updated I&E. This will look at whether your payments should increase or decrease. And at whether there are now nay better debt options for you. If you are finding the DMP payment hard to manage, you can ask for a review in mid year.
What are your other options?
Getting a letter from a debt collector asking for a payment review is a good time to think about your other options.
You may be very happy paying that £10 a month, but it isn’t clearing the debt very fast…
Four things to think about:
- could you make a settlement offer? A debt collector may be happy to take an offer and it would sort this debt out. A debt that has dropped off your credit record will not reappear if you settle it. And if it is defaulted, it will still drop off your record after 6 years from the default date.
- can the debt collector produce the right paperwork? If the debt is a loan, credit card, catalogue or Hire Purchase, read How to ask for the CCA agreement.
- could you win an affordability complaint? This would be against the original lender, not the debt collector, but if you win then the lender will sort out the debt with the debt collector.
- do you have a better debt option? Talk to National Debtline on 0808 808 4000.
No credit checks for new mortgage fixes?
Paying a debt not on your credit record
Could a Debt Relief Order help you?
Jane Clack says
A useful and interesting article – clearly and simply explained.
Graeme Curtis says
hello
I have a debt from negative equity from around £11k in 1999 (nearly 18 years!) and have been paying £20 a month ever since. I still owe around £8K.
Recently i have been contacted by new debt collectors asking for income & expenditure (haven’t heard from the previous debt collectors in years or had an statements from them). They also have sort of asked for copy bank statements and payslips etc. Do I legally have to send them these?
I am going to offer them £2K which will come from a relative…how likely are they to accept this as f&f settlement?
any advice or experience would be welcome.
Sara (Debt Camel) says
Legally you don’t have to send an I&E statement or bank statements, as the article above says. But the chance of the debt collector accepting a low F&F settlement if you don’t is very small. It is a shame you didn’t go bankrupt 11 years ago :(
Howard Fleetwood says
Hi there
Do l need to fill out an income expenditure form when asking for a settlement figure to a creditor.
I am getting the money to settle from my girlfriend.ls filling one out lawfully neccessary.
Thanks
H
Sara (Debt Camel) says
You don’t have to, but the creditor may be more likely to accept your offer if you do.
david smith says
i was told i have to fill out a i&e form as its is a legal requirement and send in bank statements and wage slips off which i don’t have is this true . also they said they can’t do i &e over phone but my sister who works in debt collection said they can . is that also true
Sara (Debt Camel) says
As the article above says, you don’t legally have to to this. But if you refuse, they pay go to court for a CCJ.
It’s really not worth arguing over whether you can do the I&E on the phone. It’s often better to do it on paper as you have more time to think about it. If you aren’t sure what you should put down, talk to National Debtline on 0808 808 4000 about this.
Christine Morris says
I have a few debts, have managed over the years to pay some off. I am now retired and disabled. I am paying £10 month on a mortgage debt , have been paying for approximately 25years, this debt can never be paid, I feel I have tried but it’s all becoming too much. Can I declare bankruptcy?
Also can they ask to use my disability payments towards the debt?
Sara (Debt Camel) says
Do you mind some questions? You are now renting? How much is left from this old mortgage shortfall? How large are your other debts?
Bev says
Do you legally have to include a new partner/spouses income on an I & E form even though debts were from a previous marriage? Surely debts/joint debts incurred from previous relationships have nothing to do with what a new partner earns & he/she shouldn’t be made to include their earnings to create a disposable income for a debt that has nothing to do with them?
Do you also have to give bank statements, bearing in mind that most people are paperless today?
Thanks
Sara (Debt Camel) says
Is this from court or from a debt collector?
Bev says
The original debt management plan which the company were being paid through has stopped. A direct payment & set a new plan up direct with the debtor with a slightly higher monthly payment was tried but they want loads of information including a partners/spouses income details (presumably to create a disposable income but surely a new partner/spouses income can’t be used as it’s nothing to do with a debt from his/her partner/spouses previous marriage?)
Do bank statements have to be provided?
Thanks
Bev
Sara (Debt Camel) says
There is a difference here between what you have to do “legally” and the practical way forward.
Legally you don’t have to tell them anything about your partner or supply bank statements. But legally they may be able to charge interest (if this still the original creditor or has the debt been sold?) and can take you to court for a CCJ – neither of which you want.
A DMP (and that’s what you have, even though you are running it yourself) is an informal arrangement between you and your creditor, you are just trying to reach an agreement as to what is an acceptable payment from you each month.
In a situation where you had a DMP through a firm and have now switched to a DIY one, the creditor may be wondering if you could actually afford to pay a lot more and you left the DMP firm because they told you that you had to. That may explain all the questions.
What sort of debt is this? How old is it (since you opened the account, not since you defaulted)? Is it still owned by the original creditor – if it is, have they stopped adding interest and have they added a default to your credit record? How long will it be before your new DMP repays all your debts? Do you have other debts that are not included in this DMP?
Jackie Littell says
I have been left with a bill from my dads funeral. The funeral people want £1,600. I am on JSA and my father who passsed away on 13th Aug 2018 was the last member of my family. I offered £10 month they refused that and want me to fill in a expenditure form. Do i have to or let them take me to court. I have nothing to lose.
Sara (Debt Camel) says
Have you seen if you can get help with the funeral costs? https://www.gov.uk/funeral-payments
melaine says
I have a debt of 60,000 I had a arrangement a new company has taken over I have filled an IE form but I have maintained payment each month
but they still want to see bank statements & wage slips I had never been asked for this before from the previous company
Do I legally have to provide the bank statements and wage slips
Sara (Debt Camel) says
Well legally they can’t force you to provide them – but then they don’t have to carry on with the previous arrangements, so if you don’t want them to take you to court, it’s usually best to comply. Do you have any reason not to?
Is this 60k of debt all owed to this one company> Do you have other debts as well? How long will it take to clear it if you carry on paying at the current rate?
Dave says
Hi can someone you owe money to make you send them a copy of your wage slips
Sara (Debt Camel) says
Have you offered an amount to settle the debt?
Paul says
When filling in a income and expenditure form, the company requested pay slips and proof of earnings, to which I have no problem. But they are asking for Bank statements, do I have to supply these.?
Sara (Debt Camel) says
No you don’t. But they may be more likely to believe your I&E if you do.
RPD says
I received a letter from a solicitor handling a ccj I have from 2013, started paying it in 2018, saying the account has reached the end of its term and my financial situation needs to be reassessed. They have provided an I&E form. I pay £5 a month and whilst this could be upped to approx £10 per month, a family member has offered to pay a settlement figure of just under 50% of what is owed as the letter stated that they maybe willing to accept an offer of a significantly reduced amount and to contact them by phone. I did this, they would not give me a settlement figure but said that I just had to put in an offer and they would see if the client accepted, I offered the amount and they asked if I could pay that day, I advised provided they email me to say the offer was accepted then my family member would transfer the money to me to pay. They said they couldn’t email that day(did not give reason why) they then declined the offer and told me to complete the I&E letter. There is currently £1500 outstanding. Have they followed the correct procedure? Surely the client would have a minimum figure they would accept as stated in the letter? They also want my partners income details which he refuses to give me as the debt is from a previous relationship I was in. He is also concerned as I live in his mortgaged property.
Sara (Debt Camel) says
You can’t make a creditor accept an offer and there is little point in arguing with them about this.
Your partner’s house is not at risk from a CCJ in your name.
What is the rest of your financial situation like? Do you have other problem debts you are paying small amounts to? Other problem debts you are not paying at all? ?
RPD says
Thank you for replying so quickly. I have one other ccj I am paying £5 a month for, no other debts. I’m just trying to understand why they mentioned a significantly reduced amount when they won’t tell me what they would be prepared to accept. I haven’t missed any payments.
Sara (Debt Camel) says
well I suggest you talk to National Debtline on 0808 808 4000 and get them to draw up an I&E sheet you can show to the solicitors.
JohnO says
Hi. A debt incurred by my wife, but in my name has been passed to solicitors. My wife hid it from me and said that the debt had been sorted, until I found the solicitors letter. However, in order to rectify, I have offered them a sum of money per month (£50 a month on an £1800 debt, so paid off over approx 3 years). They now want me to give them a full I&E before they even take instructions from their client. I can probably afford more but with the current financial crisis and everything going up, I don’t want to leave myself short in an emergency. Is there a magic figure or ratio debt collectors use? Will they seek more from me or will they allow me to have some excess money left at the end of the month? Thanks
Sara (Debt Camel) says
There is no magic figure or ratio. You could complete this budget sheet https://tools.nationaldebtline.org/yourbudget/ which will prompt you for expenses you may have forgotten and suggest what to offer. Don’t underestimate expenses and allow for things like Xmas, money for servicing the car, dentists etc.
JohnO says
Thanks Sara. Say hypothetically if I have £150 left a month, and I’ve offered £50 per month, are they going to demand the full £150 from me? Or do they usually allow some excess? It’s all new to me I’m afraid.
Sara (Debt Camel) says
the offer you make should take account of putting money aside for expenses that don’t happen every month- as I said things like car servicing and dentists. If after that you still have money left over, then a creditor would expect to be paid more.
Paul says
Good Afternoon
Please could you help I have been paying Link Financial £1 a month, but now they have sent a payment review and I was wondering should I ask them for a copy of the credit agreement and should I stop paying the £1 a month until I get a agreement.
Sara (Debt Camel) says
What sort of debt is this for?
Can you pay more than £1 a month to it if they can produce the credit agreement?
Do you have other problems debts or any arrears on bills at the moment?
Paul says
Good Morning
It is for a credit card and really not sure if I could pay more as all my bills have gone up but my wages have not. Was just thinking that if they can’t produce the agreement then it would give me some breathing space as it would be one less thing to worry about right now. But was not sure if I could ask for the agreement as I have been paying the £1 a month for a few years.
Sara (Debt Camel) says
Yes you can. See https://debtcamel.co.uk/ask-cca-agreement-for-debt/
MISS A M says
Hiya
I have had an agreement with a dept. collection agency for 15years now and pay £50 a month I now owe 6k but they keep asking for an up-to-date incomings and outgoings. Looking at the trail above I’m not legally required to give but will do out of good will. Question is – will they have the old expenditures on file still?
Sara (Debt Camel) says
can you tell me what sort of debt this is? Who was the original lender?
DENNIS says
Hi, My son has just found out his partner owes £29000 of debt to five agencies, she filled in a form requesting info of her outgoings, some answers were true some false, she said she paid over £300 mortgage-£200 child maitenance to her ex husband all lies, her actual monthly outgoings are in the region of £100 a month max give or take, she delibrately quits most of her agency jobs and had over 14 in the last 18 month, some she just takes lots of time off in order to lose the job, she is paying back a really paltry sum each month to debt collection agencies, her last job was paying her around £500 a week… is what she is doing illegal? if so why are they NOT checking the info she has supplied….
Sara (Debt Camel) says
It sounds like she needs debt advice. What does your son think of this?
Sandra says
If you have been served a CCJ for a debt of £8,000 and are completing a form N245 to pay in instalments, the form requires details of bank account and any savings. If personal savings were around the £8,000 mark would the request to pay in instalments be denied and the debt would be required to be paid in full?
Sara (Debt Camel) says
why do you have so much savings – are you able to withdraw the money?
What sort of installment plan would you be proposing – there is a lot of difference between £50 a month and £1000 a month.
if an installment plan is agreed, you will have the CCJ on your credit record for 6 years – if that money is meant for a house deposit, you will find it very hard to get a mortgage at an OK rate with a CCJ on your record.
Valentine says
I have a credit card debt of about 15,000. I gave my son my credit card in 2014 to help him out resulting in the debt. I have been paying global debt collectors 10 a month since then without missing a payment. I, and my wife, are now retired and have a house with no mortgage. Capquest have now contacted me saying they have the debt, they have a bad reputation for bullying. Can they change the agreement? What offer are they likely to accept as full and final? If we sold our car we could raise about 50%. If I continue to pay regular monthly payments can they go to court? Any thoughts greatly appreciated.
Sara (Debt Camel) says
When was the credit card account opened?
Do Capquest own the debt or are they collecting on behalf of the original lender or another debt collector?
What are the rest of your finances like – do you have other debts that you are paying normally? Other defaulted debts? Any arrears on bills?
Hatfield says
Approx 15 years ago I took out a loan in my name on behalf of someone else ( Halifax personal loan). Unfortunately they did not make repayments as required and I had to pay the debt back.
Since then I have been paying £40 per month to a debt recovery company( Halifax sold off the debt). Ihave not missed a payment since and now owe 7k.
They are now constantly ringing , texting me and emailing me telling me they are going to send a representative from orbit round my house on their behalf to discuss the debt as its time to review. I have not heard anything from my current collector prior to this in over 5 years.
I feel that the company are harassing me into increasing my payments. What can I do.
Sara (Debt Camel) says
who is the debt collector that now owns the debt?
Hatfield says
Cabot financial
Sara (Debt Camel) says
One thing you could consider is asking Cabot to produce the CCA agreement for the loan. See https://debtcamel.co.uk/ask-cca-agreement-for-debt/. If they can’tm the debt is unenforceable in court and you could simply stop paying.
Could you afford to increase the payments? What is the rest of your financial situation like?
Hatfield says
Thank you. My financial situation is that I could afford to pay 10 extra per month but this would be my limit due to current financial circumstances. I don’t have any savings to ask for a settlement.
Sara (Debt Camel) says
So it is up to you whether to ask for the CCA. With such an old loan it is possible ity can’t be found, but this can’t be guaranteed.
You can say you do not want a representative to call and you will not let them itn But you are happy to discuss your situation on the phone, although you don’t think you can increase the payments.
Marilyn says
Hi I have been paying a debt of £2738.86 from drydens I pay a £1.00 a month.. I know its only a small amount but I’ve been paying it for years. I was on a dmp first then when she left college and went to uni all my benefits for her stopped. she is now 32…. and the dmp advised me to offer a token payment for £1 .. this debt has been passed on so many times I can’t remember who the original debt was for. Anyway my car of 11yrs old finally packed in and I went to try and get a new car on finance and was rejected! I then discovered that drydens had put a ccj against me without me knowing. I have never defaulted on the payment at all. Is this allowed? Shouldn’t I have been informed? It was so embarrassing. But the sales man came through for me and now I have a pcp arrangement over 4 yrs … the problem is I have to pay that back and now I’ve received a letter off drydens to provide an income an expenditure sheet this is all for arrow popla who was.the previous solicitors by the way.
My question is can they put a ccj on me without my knowledge?
Sara (Debt Camel) says
Did Dryden have your current address?