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Temporary repayment plan

Debts passed to a collection agency while on a TPP

You'll need to let your token payment plan (TPP) provider know if one of your debts is passed to a collection agency. Once you’ve done this, your TPP provider will make any future payments to the debt collection agency. 

When you’re on a token payment plan (TPP) your creditors may pass your debt to a debt collection company. This means that you owe the money to them from now on. If this happens it helps to know how this affects you and your plan.

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How does this affect my TPP?

Firstly, this is nothing to panic about. This is part of the normal debt collection process, and the new creditor must send you a letter explaining that the debt has changed hands. Any future token payments should be made to the debt collection agency instead.

The letter you receive may ask you to get in touch and arrange payments, or ask you to pay in instalments. However this doesn’t mean you should start paying the new creditor more than you were paying through the TPP.

What do I do next?

You should contact your TPP provider as soon as you get confirmation that a debt has been transferred or sold. It’s best to have the creditor’s letter to hand when you do this, as they may need some details from it.

Will a bailiff visit my home?

Debt collection agencies aren’t bailiffs (enforcement agents) and don’t have any special legal powers. They have the same rights as the original creditor, and they usually specialise in collecting debts where the original creditor can’t get arrears repaid.

Collection agencies may tell you that someone could visit you at home. This person will be a ‘doorstep debt collector’ or ‘field agent’ not a bailiff. In practice, this doesn’t happen often and collection agencies will usually stick to contacting you by phone, letter or email.

If a debt collection agent does call at your house, remember:

  • They aren’t bailiffs (enforcement agents) or a sheriff officers, and pretending to be a bailiff is a criminal offence
  • You don’t have to open the door or let them in
  • They must show proof of ID
  • They must leave if you ask them to
  • They can’t take anything from your house

If you’re worried about debt collectors visiting you at home, we’d recommend getting in touch with your TPP provider so they can give you all the advice you need.

What happens to interest and charges?

Usually by the time a debt is passed to a debt collection agency the interest and charges will have been frozen. In many cases once creditors are aware you’re on a token payment plan they may stop additional fees. However this is not guaranteed.

The important thing to do is to keep up with your TPP payments as by doing this you’re showing creditors you’re serious about dealing with your debts.

Are you considering a TPP?

If you’d like to know if a temporary or token payment plan is the right option for you then you can find out with our online Debt Remedy tool. Alternatively you can call our Helpline (free from all landlines and mobiles).

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Foundation for Credit Counselling Wade House, Merrion Centre, Leeds, LS2 8NG trading as StepChange Debt Charity and StepChange Debt Charity Scotland. A registered charity no.1016630 and SC046263. It is a limited company registered in England and Wales (company no:2757055). Authorised and regulated by the Financial Conduct Authority.

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© StepChange Debt Charity 2017