Here’s a story that could happen to anyone but you’d hope it never does.
It concerns a London financial journalist, who made the mistake of opening a debt collector’s letter addressed to the previous occupant of the place she had just bought and the nightmare that ensued when she did. Her horror story began not long after she became the owner of a London flat. There were letters addressed to the previous occupant, one of which was from a debt collector, relating to 453 pounds owed in unpaid rent including the debt collector’s fee of 214 pounds.
She called her solicitor, who quite rightly told her it was nothing to do with her and they instructed her to forward the letter to them and they would sort it out with the vendor’s solicitors. And, if she had left it at that, there might not have been a problem.
But she didn’t and there was. In an attempt to be super helpful the financial journalist, who quite frankly should have known better, telephoned the debt collection agency and told them the individual they were pursuing no longer lived at the address. She would later explain that her motivation for making that telephone call, had to do with her upbringing and being taught to avoid debt at any cost. For that reason she does not have an overdraft, never owes money on her credit card nor does she miss a payment of any kind. It’s kind of weird but it works for her.
But clearly she had not the slightest clue who she was dealing with. Firstly, debt collection agencies have heard every excuse that has ever been used. Secondly, if they can match a name with an address that owes them money they are never going to let go. And that’s what happened in this case.
A week later, after the telephone conversation, the financial journalist received another letter from the debt collector. This time it was addressed to her and not the previous occupant. It made all manner of menacing threats such as notifying her mortgage lender, except being the thrifty person that she was she didn’t have a mortgage. Anyway, the letter was threatening enough to be unsettling.
Obviously there was an ongoing problem, so our financial journalist tried telephoning the debt collector for a second time. All she wanted to do was sort it out and enter a dialogue to resolve the situation. What she didn’t understand was that the only dialogue a debt collector is interested in is cold, hard cash. In other words: show me the money. Her attempt to reach a resolution through negotiation was met by a brick wall. The voice at the end of the telephone told her that their client had instructed them to collect the debt from her and that was the instruction they were going to follow.
It was just the beginning. Over the coming weeks, our financial journalist came to dread receiving the post because the demands for payment just keep coming. Her attempts to stop them proved futile. She tried contacting the UK Credit Services Association that represents debt collectors and has a complaints procedure but the firm demanding money from her was not a member. In her desperation to escape the quicksand, she even considered paying the debt in full, even though she didn’t owe it, to end the constant stress and the billowing administration charges. But her solicitor advised her against it.
Finally, she received the notice you get before legal action, with the threat of bailiffs entering her home and seizing her goods. She knew then she had to do something decisive to make it all stop.
In one way she was lucky. As a financial journalist she had access to some of the UK’s top credit experts. They helped her to write a letter of complaint. But not some stock standard, run-of-the-mill letter of complaint. This letter used very precise language that only debt collectors understand. For example, instead of writing: this isn’t my debt, she wrote: I dispute this debt. And if by magic it worked. The matter was placed on hold while an investigation took place.
Six months after the beginning of her nightmare, she finally received a letter telling her she didn’t owe any money, which is what she had been trying to say all along except no-one at the debt collection agency was listening. The matter is officially closed.
But according to a credit reference expert it is not uncommon for people to find themselves pursued relentlessly by debt collectors and trapped in a cycle from which there is no escape. This situation is only made worse by the fact that books of debt are often on sold to other organisations many times, losing sight of the original authority. The more organisations that become involved, the harder it is to break free especially if the debt was never yours in the first place.
The authority in the United Kingdom, responsible for regulating the credit industry, which includes debt collectors, is promising an overhaul of existing regulations. The moral to this story, if there is one, is never attempt to talk your way out of a letter of demand from a debt collection agency. Instead, tell them you are disputing the debt. If you don’t believe you are liable, then there is an absolute onus on the collection agency to prove that you are.