Scotland // Unsecured Debt // I have been contacted by a Solicitor

If you have fallen behind on payments to any unsecured debt under the value of £10,000 and do not own your home, your lender may instruct a Debt Collection Agency to try and engage with you to agree a repayment arrangement.
It is important you engage with these companies to address your unsecured debts as any defaulted account will be registered on your credit file for 6 years.

Prior to engaging with a Debt Collection Agency you may wish to;

Complete an income and expenditure form

The Debt Collection Agency will likely ask you for this information, it is important to have an accurate reflection of your household’s income and expenditure to see how much spare income you have monthly.

Download Income & Expenditure Form contains a useful calculator to see if you would be entitled to claim any additional financial support you may not be aware of.

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Contact PayPlan

PayPlan can offer help and support for any debt situation and a tailor made solution to suit your needs. PayPlan understand the impact that debt can have on your life. Their confidential and free advice service offers a wide range of practical solutions to help you become debt free.

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If you have unsecured debt, it is likely your lender will instruct a solicitor to raise legal proceedings on their behalf, the litigation process is as follows;

When a solicitor is instructed they will normally issue you with a Letter Before Action, this will allow a set period of time for you to contact them to enter into repayment negotiations prior to any court action being raised.

Should there be no contact during the period provided by the letter before action, a court action will be raised. The court papers will be served on you by recorded delivery or by Sheriff Officers (Officers of the Court). You will then have a 21 one day period OR a date specified to advise the Court (Return Date/Hearing Date) in which you may lodge a formal response to the action.

These options include:

  • Lodging a Notice of Intention to Defend and thereafter lodging your Defence.
  • Applying for a Time to Pay Direction / Time to Pay Order (only if the debt is under £25,000.00)

If no response is lodged, the Sheriff can grant a Decree for Payment without the need for a hearing.

Once an extract decree for payment has been received, the lender has several options for further debt recovery action. These can include but are not limited to:

Charge for Payment – The Charge for Payment is a final demand for payment, this must be served prior to further debt recovery action such as bank arrestment / earnings arrestment etc.

Bank Arrestment – a bank arrestment catches any funds in the bank account at the time of service.

Earnings Arrestment – your employer would deduct a certain percentage of your net earnings on a monthly basis. This amount will be paid directly to the lender or lender’s representative until the debt is repaid. The percentage deductible is based upon how much you earn. If you already have an Earnings Arrestment in place with another lender, the second lender can apply for a Conjoined Earnings Arrestment. This works in a similar way to a regular Earnings Arrestment but is administered through the court.

Sequestration – Sequestration is the Scottish term for Bankruptcy. This is an option to a creditor who is owed in excess of £3,000 by an individual. The effect of sequestration is that the estate of the individual i.e. everything he owns, his savings etc is ingathered by the Trustee (the court appointed individual to deal with the estate) and is thereafter distributed to creditors. This will be distributed on a pro-rata basis.

Registering an Inhibition – This form of action does not require a Charge for Payment to be served prior. The lenders solicitor will send a notice and schedule of inhibition to the Land Register of Scotland and ask them to register an inhibition against you. This would result in you being unable to sell, refinance or dispose of any heritable property you may own, without first clearing the debt due to your lender.

Regardless of which route is taken by the solicitor the aim is to have the debt repaid by one of the following methods;

Repayment Arrangement

A repayment arrangement would be agreed in line with your affordability and take into account any contributions to arrangements agreed for any arrears on your priority debts. This would comprise of a monthly contribution to your unsecured debt(s) reviewable annually to consider any changes in your circumstances.

Partial Settlement

At any time you can make a partial settlement offer to your lender via their solicitor. A partial settlement would be an offer of a lump sum to clear most of your outstanding debt. It is up to your lender as to whether this will be agreeable and your credit report would show the debt as being partially repaid rather than fully repaid.

Settlement in Full

You can of course settle your debt in full at any time, this would reflect as a full settlement on your credit report.

If you have several unsecured debts and are finding them difficult to manage, it would be useful to talk to a company like PayPlan who can take a view on your whole debt situation and provide advice on different solutions which may be available to you including; a Debt Arrangement Scheme, Debt Management Plans or Individual Voluntary Agreement’s.

Regardless of your change in circumstances, there are many options available to you once a solicitor has been instructed on your lenders behalf. However, you must;

  • Be willing to engage with the solicitor or your lender at the earliest opportunity.
  • Be honest with the solicitor or your lender regarding your circumstances.
  • Seek some independent legal advice on the situation, you can obtain this from places like your local Citizens Advice Bureau.
  • Address any other arrears situations on priority bills as a matter of urgency.

Visit the ‘Help Centre’ to see which other sources of help or advice are available to you.

If you have been contacted by Aberdein Considine, please don’t be afraid to pick up the phone to us. Our Scottish based Debt Recovery team are keen to discuss your circumstances with you and find a resolve for both you and your lender.
You can contact us on 0800 033 4015 or

If you have been contacted by another firm of solicitors, please contact them or your lender as a matter of urgency to prevent further litigation action proceeding.