Contacting creditors

• Model letters

If a client believes their debt has prescribed, the next actions they take depend on how sure they are that the relevant period has passed.

If the client is certain the limitation period has passed, and they have not heard from the creditor, the client does not need to do anything.

If the creditor contacts the client, they can send a letter stating they believe the debt is now prescribed. This puts the ball in the creditor’s court and forces them to provide evidence that the debt is not prescribed.

If the creditor can provide proof of payment or written acknowledgement of the debt, the client is still liable, and the debt is not prescribed.

If a client is not certain whether the relevant period has passed, they could check their credit file to see when the last payments were made for the debt. Remember, though, that just because a debt has fallen off or is not shown on a credit file, it is not proof that the debt has prescribed.

When a creditor actively contacts a client, advisers should not recommend that clients ignore the debt in the hope that the five-/20-year period will pass, as the creditor may start court action just before the limitation period has passed.

Model letters

There are several model letters available online that a client can use to challenge the liability of a debt they are being pursued for. It is important that they use the correct wording and do not in any way admit liability in the letter. It is preferable for the letter to be from the client directly and not written on their behalf – although an adviser can help a client compose the correct wording.

National Debtline has a sample letter template at nationaldebtline.org/sample-letters/time-has-run-out-recover-debt-s.