Solicitors do not collect debts on behalf of a client. A debt collection solicitor’s role is to facilitate legal action and provide advice. If you are owed money and approach a debt collection solicitor to recover that money, you will be able to take action in a 2 stepped process:

1. Letter before action – a solicitor will compose a letter threatening extensive legal action if the debt is not settled.
2. Court action – if the debtor fails to respond to the initial letter then court action can be taken at a slightly higher fee. The debt collection solicitor will give you the opportunity to post a court action form the debtor. Court costs for debt collection can range from £15 to £70 if you are filing your case through the Claims Production Centre.

Debt Collection Agents

There are two types of debt collection agencies, 1st party and 3rd party. The former is a debt collection agency that exists within the business who owns the debt – this instance is not applicable as such a legal team would not require online resources! 3rd party debt collection agents often charge only if the debt is successfully collected. This is known as a ‘pot fee’ (potential fee upon successful collection) and can range from anywhere between 10% and 50% of the total debt successfully collected.

Other debt collection agents offer a soft service at a flat rate. A soft collection agency does not proactively attempt to collect the owed debt. Instead, a soft debt collection agent would send a series of warnings, each one being more urgent than the last with a delay of around 10 days between each. This type of debt collection can be very successful and avoids incurring the larger ‘pot fee’.