Debt Collection Agencies: How to Deal With Lowell, CapQuest and Moorcroft

Debt collection agencies are companies hired by original creditors to recover money owed. If you have fallen behind on payments for things like credit cards, personal loans, mobile phone contracts or council tax, your original creditor may pass your account to a third-party collector.

Companies like Lowell, CapQuest (now part of Arrow Global) and Moorcroft are among the largest debt collection agencies operating in the UK. They buy debts at a reduced rate or work on commission. Once they take over your account, they become the point of contact for repayment.

It is important to understand that these agencies do not have any special legal powers beyond what the original creditor had. They cannot force entry to your home, seize your belongings or take money directly from your bank account without a court order.

The worst thing you can do is ignore correspondence from debt collection agencies. While their letters and calls can feel intimidating, burying your head in the sand usually makes the situation worse. Here are the steps you should take:

1. Check the debt is legitimate

Ask for a copy of the original credit agreement. Under the Consumer Credit Act, the agency must provide this within 12 working days. If they cannot prove you owe the money, they cannot enforce the debt.

2. Check the debt has not expired

In England and Wales, most unsecured debts become unenforceable after six years if no payments have been made and the debt has not been acknowledged in writing. This is known as a statute-barred debt. Be careful not to make a payment or acknowledge the debt in writing, as this can restart the clock.

3. Work out what you can afford

Use a budget planner from MoneyHelper to calculate your disposable income. Debt collection agencies are required to accept reasonable offers of repayment, even if the amount is small.

4. Put your offer in writing

Send a letter or email setting out your financial situation and what you can realistically afford to pay each month. Keep copies of everything. If the agency refuses a reasonable offer, this could count in your favour if the matter ever reaches court.

There are common misconceptions about the powers debt collection agencies hold. To be clear, they cannot:

• Enter your home without your permission (only certificated bailiffs with a court order can do this in limited circumstances)
• Take your belongings or vehicle
• Have you arrested or sent to prison for non-payment of most debts
• Add their own fees to the debt unless the original agreement specifically allows it
• Pretend to be bailiffs or enforcement agents
• Contact your employer about the debt (unless they have a legal right to do so, such as an attachment of earnings order)

If a debt collector claims they will send bailiffs to your home, this is almost certainly an empty threat. Bailiff action requires a court order, and even then, strict rules apply. You can read more about what enforcement agents can and cannot do on our site.

At Council Tax Advisors, we provide free guidance for people struggling with debt, including those being pursued by debt collection agencies. Whether your debts relate to council tax, credit cards, personal loans or utility bills, we can help you understand your options and take practical steps towards clearing what you owe.

We work with you to create an affordable repayment plan that fits your budget. We can also advise on your rights if a debt collector is overstepping the mark, and point you towards council tax support if rising bills are part of the problem.

You do not have to deal with debt collection agencies on your own. Getting advice early can prevent the situation from escalating to court action or bailiff involvement.