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In debt? What's the worst that can happen?

Being in debt and struggling to pay your bills can be frustrating and stressful, especially if you are feeling pressured into making repayments you cannot afford. But how far can companies actually go to reclaim your money?

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Debt collection companies and bailiffs have been known to harass people at work and threaten to throw them in jail.

This is not actually allowed - there are rules and regulations governing the collection of debts that give you some protection.

Who is chasing you for payment?

It is important to know who you're dealing with so you can be clear on exactly what they might do and what you can do about it.

Debt collection companies are used by banks and building societies to chase unpaid debts on credit cards, overdrafts and loans.

They are also used to collect debts by:

  • Utility companies

  • Payday loan companies

  • Non-financial businesses

However, they do not have the same powers as bailiffs and are more restricted in what they can do.

Did you know?

There is a difference between what debt collection companies and bailiffs are allowed to do to reclaim money.

Whether a debt collector or bailiff is appointed will largely depend on the type of debt you have outstanding.


If a debt collection company fails to recover your outstanding payments and the company you owe money to successfully takes you to court, a bailiff can then be appointed.

The exception to this is if you fail to pay your council tax or are convicted of an offence and do not pay the fine. In this instance the court can hire a private bailiff to collect your debt.

What can they do to recover your debts?

In the guides below we answer everything you need to know about what debt collectors and bailiffs can do to reclaim money that you owe:

How to deal with debt collectors

Are debt collectors allowed to harass you?

Can debt collectors take money from your bank account?

How to complain about a debt collection company

Can you get evicted for unpaid debts?

If you have an unpaid mortgage or secured loan, the borrowing is directly linked to the value of your home.

Repossession is something that lenders try to avoid if possible. They are also obliged by the FCA to try and find a different solution before they take steps to reclaim your home.

If you are struggling to meet mortgage payments, it's a good idea to speak to your lender as soon as possible to see what they suggest.

What about unsecured loans?

If you have any unsecured loan or credit card debt it is still possible that you could lose your home if you are unable to keep up with your repayments. However, the lender would first have to get a charging order from with a County Court judgement.

Can you go to prison for unpaid debts?

Unless you have knowingly committed fraud and this is proven in a court of law, you cannot be sent to prison for failing to pay your debts.

It is illegal for a debt collection company to imply that non-payment will lead to criminal proceedings; this is considered to be a form of harassment.

What if they threaten to send you to prison?

If you have been told by a debt collection company that you will go to prison unless you pay this is tantamount to harassment and in breach of guidelines.

If you find your self in this situation you can complain about the debt collection company in question either through the original creditor in question, i.e. the bank, utility company or council that you owe money to or by complaining to Trading Standards.

Contact Trading Standards through GOV.UK