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

Being in debt and struggling to pay your bills can be both frustrating and stressful, especially if you are feeling pressured into making repayments you simply can't afford. But how far can companies actually go to reclaim what's theirs?

Updated on 20 May 2015.

Older couple looking at bills on sofa

If you're struggling to repay money you've borrowed not knowing where you stand can make the situation even more nerve-wracking.

Debt collection companies and bailiffs have been in the headlines for all the wrong reasons recently, harassing people at work and threatening to throw those that owe in jail.

You'll be relieved to hear that this isn't actually allowed - there are rules and regulations governing the collection of debts that give you some protection. We explain just how far a debt collection company can go before they overstep the mark so you know where you stand.

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Who's chasing you for payment?

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

It's 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.

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

Debt collection companies are used by banks and building societies to chase unpaid debts on credit cards, overdrafts and loans. They're also used by utility companies, payday loan companies and many non-financial businesses to collect debts.

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

Only if the debt collection company fails to recover your outstanding payments and the company you owe money to successfully takes you to court will a bailiff be appointed.

The exception to this is if you fail to pay your council tax or are convicted of an offence and don't pay a fine. In this instance the Magistrates court can side step the debt recovery route and hire a private bailiff to collect your debt.

What can they do to recover your debts?

In the articles below we answer everything you need to know about what debt collectors and bailifs can and can't do to reclaim money that you owe:

Written by at money.co.uk

Further reading...

How to deal with debt collectors

Knowing how to deal with a debt collection company if you're approached for money can ensure you're not intimidated or mislead. Here's how to handle debt collectors and avoid the traps they set to get you to pay up.

What should I do if I can't pay my mortgage?

If you find yourself in a position where you can't meet your monthly mortgage payments, it's important not to bury your head in the sand. Help is at hand and there are things you can do to get back on track. We share our advice.

Can debt collectors take money from your bank account?

Worried that cash will be taken from your bank account by companies you owe money to? We explain whether this is likely and what you can do about it.

Can't afford to go bankrupt? Here are your options

You may be surprised just how expensive bankruptcy can be if you have excessive debts. We look at what alternatives are available and where to find the support you need to tackle your own financial crisis.