Good debt recovery agent?

Reply to the comment left by "Jerry Jones" at "12/12/2013 - 10:37":

It will be interesting to see what happens. FCC Paragon will certainly put the pressure on and it will cost you nothing if it comes to nothing so why not?
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Reply to the comment left by "Mark Alexander" at "12/12/2013 - 11:20":

I'll be interested in how they deal with the fact that we have a home-owning guarantor in place.

Reply to the comment left by "Jerry Jones" at "12/12/2013 - 11:32":

It will not make any difference, the whole process is systemised. Phone calls and letters, none of which you pay for unless they get a result and then only 10% of what they collect 🙂
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15%, according to the form I downloaded (on a Property 118 header)

Reply to the comment left by "Jerry Jones" at "17/12/2013 - 15:21":

Yes you're right, it is 15%, sorry my mistake. It's been so long since I last needed to use them I had obviously forgotten.
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I have used debt recovery companies in the past, but because most of my tenants are DSS, the companies have not recovered anything.

For DSS residents, I find that it is better to apply for direct deductions from the resident's welfare benefits (these are called "third party payments") as soon as they start to have rent arrears, it may not be much but it's better than getting nothing. If you charge a "service charge" to the resident for gas, electricity, water, etc, then you can also apply to have these charges deducted (in full) from the resident's welfare benefits. Most of my HMO residents admit to being rubbish at budgeting, so they actually prefer to have the service charge deducted at source.

If you do want to go down the route of enforcement there are a few things you should understand.

You will need to obtain a County Court Judgment (CCJ) before you can use the services of an HCEO. You can either start a claim yourself using the governments own website (MCOL) or by using a solicitor.

Once a judgment for money is awarded, the debtor is given a period of time, normally 14 days, to pay. If they don't, then you can then take action to enforce the judgment.

Judgments for money, both those awarded in the County Court and the High Court, can be enforced by High Court Enforcement Officers (HCEOs) providing they are over £600 and up to 6 years old.

HCEOs work under the authority of a writ of control (formerly known as a writ of fieri facias). This is issued when a County Court judgment is transferred to the High Court for enforcement. These are transferred up using form N293A and there is a court fee of £60 to obtain the writ.

If successful, an HCEO will recover your judgment debt, your court costs, your £60 transfer up fee and interest at 8%, as well as the enforcement costs, from the debtor. If enforcement is unsuccessful, say the debtor is bankrupt or cannot be found, you will only has to pay a compliance fee of £75.00.

HCEOs tend to have significantly higher collection rates than those of the County Court Bailiffs, who are salaried without any financial incentive to collect. We are also permitted to force entry into commercial premises.

However HCEOs are not miracle workers and the recovery of your debt will come down to whether the threat of your debtor losing their goods will prompt them to make payment or the removal and sale of the goods can pay the judgment issued.

HCEOs are certainly a great tool to have in the recovery of unpaid rent.

Reply to the comment left by "David Carter" at "03/07/2014 - 11:32":

but unfortunately most debtors (residential tenants) know that they don't have to let you in, and then you are completely powerless!!!!!?

Reply to the comment left by "Robert Mellors" at "03/07/2014 - 11:56":

Whilst we cannot force our way into residential property we are often let in and our results in this area are still good especially when you consider the minimal outlay.

You must also remember that goods are not always inside the property and cars are regularly seized for payment.

As I said above, we are certainly not miracle workers, but our involvement will often get the debtor talking and a payment arrangement in place.

As with any enforcement option, each case should be looked at to see if it merits the expense.

Reply to the comment left by "David Carter" at "03/07/2014 - 12:01":

How do you find out if the debtor owns a car, and which car on the street it is, if they do not volunteer that information (and it's not on their driveway)?

I accept that if the debtor owns a car and it's on their driveway, or they let you know which is their car, then yes you can seize this, but for debtors with no car then they can simply refuse to let you in and ignore you and you then have no power to seize anything. Basically, in order to exercise your "power" you need the co-operation of the debtor, who has already proved that they won't co-operate by not paying the debt even when a court has ordered them to do so.

Also, they can deny being the debtor and you have no power to make them give you proof of ID. Their partner in at their home can say that the debtor does not live there anymore and you cannot prove otherwise, so the debtor could be behind the door laughing at you while his partner denies knowledge of his whereabouts, and there is absolutely nothing you can do about this.

HCEOs certainly can work well at enforcement, but only in very very limited circumstances.