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How Long Can a Creditor Request Payment for a Debt?

April 18, 2012 | Comments: 0 | Views: 173

Since debts remain as they are until they are paid, would creditors forever bother debtors with collection? This is an issue that would surely hound you, especially if you are beset with debts that have long gone overdue. Of course, you do need to know the answer to such question so that you could make the necessary arrangements that would ultimately be freed from your debt problems. Besides, you would surely be interested in getting reprieved from all those annoying phone calls and visits coming from the debt collectors. In the UK, there are laws that may actually favor you in this regard. There are limits to debt payments, when it comes to the length of collection time.

After you have acquired a loan, the creditor already obtains the right to collect the payment according to provisions stipulated in the agreement or contract. However, it is possible that the company would no longer have the right to do so after a number of years if it could not find a way to contact you. In the UK, it would only take six years of non-payment and non-communication between the creditor and a debtor. This does mean though that the debt actually ceases to exist after six years. The debt is still there and, in principle, it should be paid. However, the creditor is no longer allowed to use the law to compel the debtor to pay. This is indeed good news for the debtor and a bad one for the creditor.

Because of this provision, it is expected that the creditor would actually do everything within the bounds of law to collect payment for the debt before the said six months of non-communication expires. In fact, it would always make sure that contact with the debtor is done frequently. In some cases, the creditor would see to it the open communication between the company and the debtor is maintained at all times. It does not matter whether the debtor pays on time or with the right amount. What is important is that there is still contact with him. This is in order to avoid the limits set by law.

On your part, such a law surely provides you with some sense of relief. But it is almost impossible for you not to be contacted in a span of six years. Apparently, such period is long enough for the creditor to find the most effective ways of compelling you to pay up. You may try transferring to another address but the creditor would still manage to locate you. Another thing that the creditor could do is to sell the debt to a debt collection agency. The debt collection agency would be the one to bother you with demands for payment. Due to the nature of their business, you could expect them to really pressure you into paying. If you do not want to go through all these troubles, the thing to do is actually quite simple. You just have to pay up.

Jim Oneil is a writer with a special interest in debt issues and personal finance. He has written for small local newspapers in the past and now devotes part of his time writing about debt consolidation and management and other UK based financial products.

Source: EzineArticles
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