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Can Payday Loans Send Bailiffs?

Person resting their hand on a door handle.

Taking out a payday loan can sometimes feel like the only option when you’re faced with an unexpected expense and have no savings to fall back on. But while payday loans provide quick access to cash, they also come with high interest rates that can spiral out of control if the debt isn’t repaid on time.

If you’ve fallen behind on your payday loan repayments, you may be worried about bailiffs (also known as enforcement agents) turning up at your door. So, can payday loan companies send bailiffs if you default? And if so, what can you do about it?

How do payday loans work?

Payday loans are a form of short-term, high-cost credit aimed at people who need money quickly before their next pay date. To take out a payday loan:

  • You borrow a small amount, usually between £50-£1000.
  • The loan is repaid on your next payday, generally within 1-4 weeks.
  • Interest is charged daily, with APRs typically exceeding 1000%.

While convenient, payday loans can encourage a cycle of re-borrowing. Borrowers often find themselves taking out a new loan each month just to repay the previous one, sinking deeper into debt. If you miss repayments, the costs stack up even faster. Payday lenders can add late fees, continue to charge interest, sell the debt to a debt collector, and take legal action.

Can payday lenders send bailiffs?

If you default on your payday loan repayments, the loan provider does have the legal right to send bailiffs to your home to seize possessions, to recover the debt owed.

Bailiffs are enforcement agents appointed collect debts. They have certain legal powers, including the ability to:

Force entry into your home if you refuse them access.

Clamp vehicles parked on private property.

Seize and sell your possessions to cover unpaid debts.

However, bailiffs can only be granted these powers after the creditor has been awarded a CCJ (County Court Judgment) against you and you still fail to pay.

The process before bailiffs are sent

Here is the typical process before a debt collection agency or bailiff is sent to recover an unpaid payday loan:

  • Default on repayments - You miss your agreed payday loan repayment date. The payday lender contacts you chasing payment.
  • Letter Before Action - If you cannot repay immediately, the lender issues a Letter Before Action. This states their intention to take legal action if you do not pay within 14 days.
  • County Court Claim - If the debt remains unpaid after 14 days, the payday lender can file a claim against you in the County Court. You'll be sent a Claim Form giving you options to defend yourself or repay the debt.
  • CCJ Issued - If you fail to respond to the Claim Form or cannot agree to a payment plan, the court is likely to issue a CCJ ordering you to repay the debt.
  • Bailiff Involvement - It is only after a CCJ has been issued and you still have not paid that the lender can enforce the judgement through bailiffs. The court will grant a warrant authorising bailiff action.

Without a CCJ, payday lenders cannot send bailiffs directly. However, they can sell debts to third party collection agencies who may later obtain CCJs enabling them to appoint bailiffs, if the debt remains unpaid.

Any missed payment and CCJ will be recorded on your credit file for 6 years.

How to avoid bailiffs for payday loan debts

Getting bailiffs involved should always be an absolute last resort. If you’re struggling with payday loans or other debts, here are some tips to avoid ending up in that situation:

Speak to your payday lender

Be proactive in speaking to payday lenders and explaining your situation as early as possible. They may agree to a repayment plan or freeze interest and charges to prevent matters escalating.

Avoid further borrowing

Don’t be tempted to take out more credit as a short-term solution. This is likely to make the situation worse in the long run.

Create a budget

Review your income and expenditure, make cutbacks where possible, and prioritise essential living costs and debt repayments. Sticking to a tight budget can help get your finances back under control.

Respond to court forms

If you receive a Claim Form or CCJ relating to payday loan arrears, you must respond as soon as possible and either pay the amount owed in full or propose a repayment plan you can afford. This may prevent bailiffs being appointed.

Consider a DMP

If you have payday loan debts alongside other unsecured borrowing, a Debt Management Plan could help by consolidating debts into one manageable monthly payment. DMPs aim to reduce interest so debts can be repaid faster.

Get Debt Help

Get debt advice

Payday loan debts can feel overwhelming, but help is available. Speaking to a debt advisor can help you understand all your options. They may even negotiate with lenders on your behalf.

Taking positive action as soon as possible can help resolve payday loan arrears before matters escalate to involving bailiffs. But if enforcement action is underway, acting quickly is still vital to try to halt the process.

How DFH Financial Solutions could help

If payday loan debt is causing you anxiety and financial hardship, the team at DFH Financial Solutions are here to help. We know that facing bailiffs can be an incredibly stressful prospect. Our expert debt advisors will explore your financial circumstances, clearly explain your options, and provide practical debt advice.

We specialise in creating personalised Debt Management Plans built around our clients’ unique situations. A properly constructed DMP provides affordable monthly repayments. This allows individuals to repay the debts included in the plan in full over time, without the need for legal action.

Don’t struggle alone – help is available. To find out if a DMP is right for you, contact DFH Financial Solutions today. Our friendly advisors are ready to help you tackle your debt in a realistic, manageable way.

Get Debt Help