what can a debt collection agency actually do if someone refuses to pay up?

Rather than selling on the debt why don't you go to a solicitor to send a letter to the tenant. But bear in mind this is going to cost you more than the debt in all likelyhood. Does your deposit not cover the amount he owes?
 
salsbury said:
hopefully not off-topic, but how do i sell on a debt owed to me by a tenant who has defaulted on rent when i have no written contract with them (only verbal)?
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no written contract means you simply wanted to earn some extra money and somebody was cleverer than you - legally, from what i know, you have little if any chance of getting the money back and the solicitor would cost you more than the money owned.
I would say, you already gained something in return - a good lesson.
 
bond-007 said:
You fail to understand how debt collectors operate here. They do not buy debts for a start. They all operate on a commission basis. So if they collect €1000 of a debt they may get €200 of it. For them to buy a debt they would need to have the debt assigned to them and the debtor must be informed that the debt now belongs to the DCA. The DCA can bring proceedings in its own right if they own the debt.

The statute of limitations is 6 years for a debt.
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My brother in law is having a problem with MBNA, basically he owes them money which he cant afford to pay(let go recently), but is paying them something every month.
They rang him today and said that once 7 months of arrears had clocked up, they would sell the debt to a 3rd party.
He questioned this and was told 'thats what has been done previously'.
And that they would sell it for less than what was owed to them.


So is it possible to sell a loan to a debt collection agency?

Or are MBNA using this threat as a scare tactic of their own?
 
MBNA will transfer the collection of the debt (not the debt itself) to a 3rd party after 7 months. If they can't collect MBNA will take legal proceedings to get a court judgement and then use all the standard collection techniques thereafter.
 
bond-007 said:
MBNA will transfer the collection of the debt (not the debt itself) to a 3rd party after 7 months. If they can't collect MBNA will take legal proceedings to get a court judgement and then use all the standard collection techniques thereafter.
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Seemingly MBNA have, & do sell on their debts:

''The woman's debt of €1,500 was bought by Cash Flow Services from MBNA. Cash Flow Services then pursued her through the courts for payment of her debt.''

http://www.independent.ie/national-...lters-is-only-way-to-recoup-debt-1764674.html
 
Papercut said:
Seemingly MBNA have, & do sell on their debts:

''The woman's debt of €1,500 was bought by Cash Flow Services from MBNA. Cash Flow Services then pursued her through the courts for payment of her debt.''
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Jailed for non payment, how would that recoup anything?
Why would a company do that, instead of say putting a judgement against a house?
 
They would do that in addition to a judgement mortgage.
It is not easy to get a well charging order where a house is in negative equity and there is an existing mortgage having first charge over it.
 
bond-007 said:
They would do that in addition to a judgement mortgage.
It is not easy to get a well charging order where a house is in negative equity and there is an existing mortgage having first charge over it.
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Sorry for going slightly off topic, but does a judgement mean the house must be sold, or that they can take some of the profit if it is sold
 
A judgement mortgage by itself does not mean it must be sold. It means it must be paid if the house is sold in the future.

A well charging order is needed to force a sale.
 
dobsdave said:
Jailed for non payment, how would that recoup anything?
Why would a company do that, instead of say putting a judgement against a house?
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I don’t know – in that particular case maybe she didn’t own a house to begin with? It may not result in recouping of the debt, but it would certainly clip the wings of the defaulter, making it near on impossible for them to obtain any other sort of credit for quite some time, & send a clear signal out to others. Although the default would have been recorded on her ICB profile way before this anyway, along with any previous judgments.

Also, I assume that she must have ignored or not complied with previous court orders for it to get to that stage. Previous solicitors are mentioned in the article, so it may be the case that there is a bit of sensationalist journalism or selective factual amnesia at play with regard to the sequence of events leading up to the committal order. However, it did result in a committal order for a €1,500 credit card debt.
 
dobsdave said:
Thanks,
I presume the well charging order is not seen too often?
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They would only go to the expense of getting a well charging order if their was equity in the property. So if a house is in negative equity the mortgage company would get the proceeds and there would be nothing left to pay other creditors so it would be a waste of time and money to get the well charging order and also their would be bad publicity.

But if the house is worth more than the mortgage they will go for the well charging order, that's my understanding.
 
A court would not entertain a request for a well charging order where there is a negative equity situation existing.
 
bond-007 said:
A court would not entertain a request for a well charging order where there is a negative equity situation existing.
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Why is this (I know you know your stuff so not doubting you)? Is it because the mortgage company has first lien?
 
Exactly. There would be questions asked such as what is the value of the property and what prior liens exist i.e. a mortgage. It would be against public policy to grant an order where the result would be to make the debtor homeless and not discharge the debt in question. A court could view such proceedings as vexatious in that situation. As there are considerable costs to the creditor in bringing the proceedings they would be foolish to do so where there were no chance of getting the order.
 
dobsdave said:
Jailed for non payment, how would that recoup anything?
Why would a company do that, instead of say putting a judgement against a house?
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I doubt she was jailed for not being able to make payment. More likely that she ignored a court order to pay an affordable amount or refused to cooperate with the courts.
 
csirl said:
I doubt she was jailed for not being able to make payment. More likely that she ignored a court order to pay an affordable amount or refused to cooperate with the courts.
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Agreed she would probally have got 7 day notice, civil summons, judgement, installment order from court and then you get a committal - I imagine she never showed up in court for any of these so the judge was left with no option.

Judgment mortgages last 12 years so if they sell their house during that period and there is any equity left after paying off the mortgage the person next in line get paid. Some properties could have a few charges on them!!
 
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