Letter To Debt Collector

Letter To Debt Collector

In this section, we discuss the points that you have to keep in mind when you write letters to debt collectors. You have to keep in mind that when it comes to debt collection, all the letter and correspondence are recorded by the agencies so always be sure of what you are stating and writing in a polished and clean language that leaves no scope for ambiguity.

A quick internet search might fetch you a lot of templates and sample letters that are written to various regulatory authorities, banks, individual companies and debt collectors. All those standard sample letter formats are good enough when coming from a credible source but, there are few points that you have to keep in mind while writing those letters-

1) Do not trap yourself into fanciful terms and legal jargon. You may find it lucrative to use all those Acts and Regulations that you find in the sample letters but unless you are fully sure that they apply to your particular situation, you should refrain from using them. In your attempt to sound like a lawyer, you may invite some legal trouble or rebuttal that may harm your case.

2) The golden rule that anything that sounds too good to be true, probably is a trap applies here too. Do not fall for claims on the internet that you can be debt free if you fulfil so and so conditions. Nothing in this world is free. Please do proper homework before making tall claims.

3) Remember to pay off important debts such as mortgage, rent or council tax arrears as these may cost you dearly. Debt collectors may try to bully or intimidate you, but you have to remember that you do have your rights and further channels of debt repayment. But in case you miss a debt that is of priority, the results may be nasty.

4) Always proofread your letters for any formatting errors. In cases when you have notices from the court or any debts that are large and are of prime importance, you need to act quickly and with precision. It is better to check again until you are completely sure of the word selection and format.

Debt charities in UK such as National Debtline, Citizens Advice or StepChange are always happy to help you with your queries. You can always approach them in case you wish to know what a particular legal term means or in case you'd like some help with your letter.

Common Points To Remember.

Although various letter formats may vary, there are certain common points that you have to remember while writing your letters-

- Always give your particulars like name, account number and address that clear up any doubts that the debt collectors may have about your identity. Remember that the agencies work with multiple debtors at a time so, clear and precise information should be provided.

- In case you have had a change of address, clear up the confusion by stating terms that perfectly distinguish that you have a new and an old address. Use sentences like, 'My previous address which was at...'

- In case you do not wish to be contacted via telephone, do not mention your telephone number.

- Remember that in legal correspondence, dates hold a significant value. Always mention dates when you received the creditor's messages and also write dates wherever necessary.

- In case you have borrowed a template, make sure that once you are done writing, you read it out loud to figure out if there are any odd sounding bits. Often, the copied letters have some embarrassing mistakes that surface only later.

- Always keep a copy of the correspondence with yourself.

The Most Common Letter Formats That Are Used By Debtors Are As Under-

1. Ask for a refund for a payday loan

Although you may have been able to pay off your loans in time, they may have been unaffordable to you. In such cases, you have to use this format.

2. You can set up your own DMP (Debt Management Plan)

Systems such as CABmoney DMP crunch the numbers and calculate the offers for your lenders. They also create custom letters for you. Running your own DMP can be tricky though. Please do proper research before jumping in.

3. In case you are taking services of a debt management company or running your own DMP

You can always take a chance by asking your lender to freeze the interest on your loan. It may or may not work but it is never a bad idea to try.

4. An offer they cannot refuse

You can offer complete settlement by this letter format. Use it only when you are sure of your finances.

5. Psychological problems

This is not a fixed template per se but in case you are in psychological distress due to any situation that concerns the debt collectors, you can always let them know via this letter.

6. Strongly worded letter

In case you have been wrongly contacted about a debt that you don't think you owe, you have to use this format to present your case. Always state in clear terms that you do not owe the money and inform the agency that you do not wish to be contacted further regarding the matter.

7. Statute Barred Debt

Very old debts become statute barred and you are not obliged to pay them legally. Always make sure that you know the status of the debt before writing this letter. Some legal help may be taken.

8. For correction on your credit record

Once insolvency is declared, you need to look for errors on your credit record. The right dates make all the difference. In case the dates are wrongly mentioned, it will just take you longer to bounce back from bankruptcy, individual voluntary arrangement or a debt relief order as your credit score will suffer.

9. Unusual errors

In case some unusual occurs like you are contacted by a creditor once a Debt Relief Order is passed. You can complain to FCA and also write a letter to the creditor.

10. Specific complaints

There are other letters which can be sent regarding specific complaints about an IVA (Individual Voluntary Arrangement).

In case you wish to seek guidance beyond a routine internet search for popular letter formats, you may browse National Debtline‘s library of template letters which covers various scenarios regarding debt and debt management. In case you still have doubts, you can always make a phone call to them and they shall be happy to help.

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