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HomeAdviceWhat can lenders do

What can lenders do?

If you’re worried about the consequences of falling behind with your debts, give us a call. We’ll explain in clear terms what your lenders can and can’t do with different types of debt.

Most importantly, we’ll help you work out what you can do to improve your situation.

Getting phone calls from lenders?

Call us for free debt advice on

1800 937 435

Contact from your lenders

If you're behind with payments, your lenders can contact you, but they must always treat you fairly.

They can't do any of the following:

  • Make an unreasonable number of phone calls to you
  • Phone or visit you outside the hours of 9am-9pm, Monday to Saturday
  • Mislead you, for example by claiming that not paying a debt is a criminal offence if it isn't
  • Pretend to have an official position, for example claiming to be acting on behalf of a court
  • Discuss your debt with anyone else - this includes your employer and family
  • Contact your place of work, unless you also live there or have given your prior consent, or all other attempts to contact you have failed

If your lenders are doing any of these, make an official complaint with the lender. If they don't stop, you can look to take this further through the Financial Services Ombudsman.

How debt affects your credit rating

Your lenders can share information about your debts with the Irish Credit Bureau (ICB) or other credit reference agencies.

Lenders can check information held about you by these agencies when they’re deciding whether to lend you money or what rate of interest to charge. This means if you have a history of not paying debts, you may find it harder to get credit in the future.

Lenders' access to your bank account

If the bank account you use is overdrawn, there's a risk your bank may reduce or remove your overdraft limit. If this happens, you'll lose any income you paid into the overdrawn account.

If you've other loans or card debts with the same bank as your current account, although quite rare, there's a risk they could take money from your account to cover any missed or reduced payment to other debts.

We'd advise you to open a credit-only account with a different bank. When you're choosing a new bank account, make sure you compare the fees as these vary.

Debts passed to debt collectors

Some lenders will pass your debt to a debt collection agency rather than dealing with the debt themselves. Collection agencies don’t have any extra legal powers, and they can’t do anything different to your original lender.

Going to court because of your debts

If you don’t pay a debt, your lender can start court action against you. The court process varies depending on the size of your debt and may be in the District Court, Circuit Court or High Court.

Civil Summons (for debts less than €15,000)

Circuit Civil Bill (for debts between €15,000 - €75,000)

Summary Summons (for debts more than €75,000)

Enforcement of court debts

Once the lender has a court judgment against you, there are several further enforcement actions they can take, including:

  • A Sheriff or County Registrar taking goods from your property to sell
  • A judgment mortgage securing the debt against your home
  • A hearing at the District Court to interview you about your financial circumstances
  • A court order telling you to pay the debt in instalments
  • Making you bankrupt

If you can make a regular payment to your debts, you’ll reduce the chances of court action. If the payment is less than your lenders would like, it will help to send them a Standard Financial Statement (SFS) to show you’re paying the most you can. Creating a budget is one of the ways we can help you deal with debt.

We can help you to put together a SFS.

Secured and priority lenders

Some lenders need to be treated as a priority because the debt is secured against your home, or because the lender has extra powers to collect the debt.

It’s important to deal with these debts first because there can be serious consequences if they don’t get paid. Examples of secured or priority debts include:

  • Mortgage – your home could be repossessed
  • Rent – you may be evicted from your home
  • TV Licence – you could get a fixed penalty fee or face prosecution
  • Tax – money can be taken straight from your bank or goods taken from you by the Sheriff to sell
  • Child maintenance payments – you could get a court judgement followed by money taken straight from your wages
  • Electric or gas – you could get a pre-paid meter fitted, or your supply cut off as a last resort

When we put together a Standard Financial Statement (SFS) we’ll always take into account the payments you need to make to these priority debts to help you avoid any further action.

What people say about us

“The guy I spoke to was very understanding, very helpful. I can see you go the extra mile and make sure you were doing everything to help us.”

- Stephen, County Kerry

Foundation for Credit Counselling (trading as StepChange Debt Charity) is a company limited by guarantee registered in England and Wales (Company No: 2757055) and a charity registered in Ireland (Registered Charity No: 20104887). Registered office: Wade House, Merrion Centre, Leeds, LS2 8NG, United Kingdom.
Authorised and regulated by the Financial Conduct Authority.

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Open Monday to Friday, 9am – 5pm. Calls free from landlines and mobiles.

StepChange Debt Charity 2018