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What Happens To Catalogue Debt After Ten Years?

by on June 26, 2012

in Debt Help

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In rare cases, people may not be notified of some debts until many years after the expenses were incurred. This may be because they relocated to another area or even another country. On rare occasions, even a debt management expert may not discover the debt during a comprehensive search to identify why an individual is having difficulty obtaining credit. Leaving a forwarding address for mail may not be enough to keep debts from falling off the radar for a period.

Catalogue debts are typically viewed as credit debts. They are incurred when people purchase items from mail order catalogues and spread the payments over a 20 to 40-week period. Under the Consumer Credit Act 1974, catalogue companies should distribute credit agreements. If both parties to the transaction do not sign a credit agreement, the debt may not be enforceable in a county court.

If a catalogue company notifies a customer of a debt and the customer disputes the charge, the customer is entitled to receive a copy of his or her credit agreement within 12 business days for a charge of £1.00. Many creditors retain credit agreements for only a few years and may not be able to supply a copy of the original credit agreement so will stop pursuing customers who have incurred debts prior to that time.

If the company does not provided the credit agreement, it is considered to have committed a criminal offense under the Act. Section 189 of the Act stipulates that the documents must be supplied whether the party notifying the consumer of the debt is the original creditor or not. If the credit agreement on file is not signed by the customer, it is unenforceable under the Act.

In the UK, there is no limit on the amount of time that a creditor can pursue a consumer for an unpaid debt. The issue that confuses many consumers is that a debt is removed from their credit files after six years. Though the debt may not appear on the credit file, it still exists. In addition, the statute of limitations dictates that if the debtor and creditor do not have contact for a six-year period, the debt is considered statute barred.

A creditor cannot take a debtor to court to request payment for a statute barred debt. However, it may still attempt to recoup payment for the debt. Some creditors will chase a debtor forever in order to recoup payment. If the debtor moves out of the UK and subsequently moves back to the region, creditors may discover the current address and restart their pursuit.

If a creditor pursues you for a catalogue debt that you dispute but do not have proof of paying, request a copy of the signed credit agreement. You may also request a statement of account, details regarding all payments made and the current balance, and details regarding the products ordered. Creditors who cannot provide the requested information within 12 working days may not take further action against you until they supply it.

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