Question about debts being sold to a DCA

[Guest]

I don’t know much about debt, or its mechanisms, but a common scenario I am reading on these forums is a policy of creditors selling debts to debt collecting companies who then approach the debtors for the money.


Does anyone know what legislation that makes a debtor liable to pay money to a debt collector who has bought the debt away from the original creditor?

[labman]

Re: Question about debts being sold to a DCA

It is covered under Common Law of Contract.

Is this article any help to you?

Walker Morris UK solicitors, corporate and commercial law firm

[Guest]

Re: Question about debts being sold to a DCA

Yes, the bottom line the article makes is a contract where a party is a person, cannot be re-assigned.

It means a (non-business) debtor does not have a liability to a debt collector who has bought the debt. Don King Productions Inc. v Frank Warren [1999] 2 All ER 218

[labman]

Re: Question about debts being sold to a DCA

That's not actually what it says when read in detail. It gives another example of the assignment you have quoted in the article. The example used is of an employer assigning employees to a new employer. However, this cannot be done, as certain contractual obligations remain with the original employer which he is then unable to meet.

It is perfectly possible to assign a debt in absolute totally legally. The danger some face is that they will think they have completed an Assignment in Absolute when, in fact, they have only done an Equitable Assignment.

If only you were right, there'd be an awful lot of very happy people! lol

[Guest]

Re: Question about debts being sold to a DCA

I thought as much,.

My sister in law has always been blighted with debt, she took out a new car on finance, she became unstuck and had it snatched but she still owed over £4k which was eventually sold to a det collector.

I dealt with it, and told them they had no contract with the debtor and never heard anymore. I just thought that was too easy.

I just got tired of bailing her out year on year with 'loans' which I know are never paid back, now her kids are in trouble with student loans and traffic penalties. I need to draw the line somewhere becaus they have DCAs who are buying their debts.

I loaned my niece a two grand to buy a car, a ford galaxy to take her three kids to school, she got tickets didnt pay them, and JBW took the car, now she is back for another car loan...

My mother,. who is in her eighties has found out, and is not happy I have become the de-facto family bank. I need to research more on how debt works.

[labman]

Re: Question about debts being sold to a DCA

If you want a starting point, you could do far worse than read this:

Dealing with DCA's - Legal Beagles Consumer Forum

The simple 'Prove It' letter in post 4 is actually a very powerful letter. DCA's themsleves are impotent without an Assignment in Absolute. They adopt similar scare tactics to bailiffs, threatening all sorts, but unable to deliver on much, if anything, of what they say.

[Guest]

Re: Question about debts being sold to a DCA

That 2nd template is a good one, I might pillage it.

Is it really worth responding to DCA letters? I ask because about 5 years ago I received a string of DCA letters all with the same date and with the name "barclaycard" for varying amounts ranging from £650 up to £5,500. Ive never had a barclaycard so I ignored them, the follow up letters, again same date, got stronger but it all eventually came to nothing, no "field agent" called.

I put it down to a fruitcake sending bogus debt letters. I dont know why people feel threatened by DCAs.

[labman]

Re: Question about debts being sold to a DCA

That 2nd template is a good one, I might pillage it.

Is it really worth responding to DCA letters? I ask because about 5 years ago I received a string of DCA letters all with the same date and with the name "barclaycard" for varying amounts ranging from £650 up to £5,500. Ive never had a barclaycard so I ignored them, the follow up letters, again same date, got stronger but it all eventually came to nothing, no "field agent" called.

I put it down to a fruitcake sending bogus debt letters. I dont know why people feel threatened by DCAs.

People get scared because for many they've never come across anything like this before and believe what they read.

Is it worth responding? Well there's a question. My suggestion is always to ignore the first one or two letters that are sent, then IF they write again, send the Prove It again and see if they can. If they can't prove their 'good title' to the debt, I don't see why anyone should feel obliged to pay them one penny.

'Good title' brings a whole new way of thinking to assignments, where you started out. Why? Because the master document showing good title is called the Deed of Assignment, and as a debtor you will never get to see this short of going through court under, I think, CPR 31 Rules of Disclosure.

A Notice of Assignment is usually viewed as notice of good title. Bluebottle also suggests asking for something (can't remember what off the top of my head) which demonstrates more than a NOA.

As with bailiffs, it is an addictive and massively abused area by the powers that be.

[Guest]

Re: Question about debts being sold to a DCA

Its not just civil enforcement that is abused and ripping people off.

All my UK finances are now under the supervision of a financial adviser after it was discovered I was "hemorrhaging" money hand over fist. I was being ripped off over almost everything from car insurance, utility bills, and losing thousands in high costs from our property maintenance contractor who looks after our portfolio of Buy to Let properties.

The UK has developed this bizarre custom of regularly "switching" suppliers. My OH did this for me saving £1800 a month. That is something I should not have to do, I should be able to trust my suppliers and my bank not to rip me off with my bills.

In Dubai, our finances and rent on my apartment are all paid by my employer, and our DEWA and Salik fees which are paid automatically by the bank, no savings could be made. Sharia banking law is very efficient.

This goes to prove the UK is in one hell of a mess, everyone is persistently looking to overcharge people in some way. I should not have to spend all this time maintaining this strange policy of switching everything.

UK banks even deliberately allowing low-income earners to become 'accidentally' overdrawn so they can rip them off with high charges. If the government acted with by introducing proper regulation, Britain would not be in this mess we see today.

[labman]

Re: Question about debts being sold to a DCA

Are you saying that you are effectively being penalised for living abroad?

I have a very close friend in Cornwall for whom I was best man a couple of years ago. Although British, he is only allowed into the country for a certain period of time each year as his exceedingly healthy salary is paid, tax free, into a foreign bank account. Money is then transferred into bank accounts in the UK as required.

I have Power of Attorney over his affairs for when he is away, but he does not seem to face these issues, though obviously being reasonably affluent, as you obviously are, he has similar business interests here. Certainly car insurance etc... I shop around each year for his cars and his motor bike, we all face sudden inexplicable hikes in premiums for things like that.

As for your property portfolio, surely you should have had some comeback against your maintenance contractor?

It must be very easy for someone who is out of the country most of the time to lose vast amounts of money if they do not have somebody trustworthy looking after their affairs here. Good job you discovered it!

[bluebottle]

Re: Question about debts being sold to a DCA

Are you thinking of Certified Copies, Labman? These are first-generation copies of the original agreement/document that are annotated with a legal statement and signed and dated in ink by a person authorised to do so. In law, they carry a lot more weight than reconstructed and reconstituted copies, which are open to abuse, i.e. forgery. I did say in one post that asking a DCA for a Certified Copy will either slow things down or bugger them completely. It's a classic case of the "No proof, no money" rule.

Regarding your post about the UK banks, Happy Contrails, I was reading an article recently which shows mutuals, i.e. building societies, credit unions and savings banks, are doing very well indeed and are in a far stronger position that their commercial counterparts. I'm looking into it a bit deeper. And I agree with you 100% about the lack of regulation of the UK banking sector. It's that that's got us in the mess we're in. Blame Thatcher, Lamont, Lawson and the New Labour crowd who were seduced by the siren voices in the City.

[bluebottle]

Re: Question about debts being sold to a DCA

This is a duplicate of the above post. Would site admin please remove this duplicate.

[Guest]

Re: Question about debts being sold to a DCA

Are you saying that you are effectively being penalised for living abroad?

Im not penalised for living abroad, just penalised for not switching my bills.

Im not noted for my financial acumen which is why a financial adviser and my OH supervising my suppliers under a Lasting Power of Attorney.

Certainly car insurance etc... I shop around each year for his cars and his motor bike, we all face sudden inexplicable hikes in premiums for things like that.

You hit the nail on the head, why should we need to keep switching insurers? why cant we trust our insurers, our bank and other suppliers to give an honest renewal?

As for your property portfolio, surely you should have had some comeback against your maintenance contractor?

There probably is, but its a tangled web of paper trails that would need to be unravelled. Its cheaper to bin the contractor and get a new one.

It must be very easy for someone who is out of the country most of the time to lose vast amounts of money if they do not have somebody trustworthy looking after their affairs here. Good job you discovered it!

Thats precisely the point, I should not need to appoint an attorney to supervise utility companies, insurance companies and my bank to make sure they are not ripping me off with high charges and inflated renewals.

The internet shows there are dozens of forums dealing with the scurge of debt and a sheer number of DCAs currently trading. If seems low-income households are constantly robbing Peter to pay Paul to balance the books.

If I were not working I know would be in the deep proverbial, I would need to be better educated on how debt collectors work.

[labman]

Re: Question about debts being sold to a DCA

BB - that's the one thank you!

HC - couldn't agree more. I lost a very highly paid job through ill health and am no longer able to work. We have a meagre pension, and are now one of those low income households. It was losing the income that inevitably resulted in debt as I had comitments matching my income. Having come out the other side, but gone through absolute hell in the process, I developed an interest in consumer debt issues, and set up my charity.

I will do anything to help anyone else avoid having to go through what we, as a family, went through.

You should be able to trust insurance companies. My car insurance this year went from £320 pa to a renewal quote of over £900. Explain that! I'd been with them for over 6 years. I got it for a simialr price to the original with a different company. As you say, why can't we trust these people? They are robbing bar stewards!

[Guest]

Re: Question about debts being sold to a DCA

Ive not had much experience of debt so Im not qualified to give advice. I was laden with student debt when I was at university, but that was all paid off over a long period of time painlessly. I was a party animal at that age and didn't care for money matters, more interested in clubbing drinking and chasing women.

It really narks me the government did nothing to stop debt culture. It can regulate banks to prevent customers going overdrawn, and that would've prevented the bank charges fiasco. Regulate insurers to limit automatic premium rises to inflation, or mandate a compulsory re-tender to competing insurers for a premium that is equal or below inflation. Ditto utuility companies.

Easily done.