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Debt collection agencies agree to 30 day cooling off period

In a move which could assist those in the UK struggling to repay their credit card debt, the government and the Credit Services Association (representing over 300 UK debt collection agencies) have agreed a 30 day cooling off period for those at risk of a visit from a debt collector. Under the new guidelines, debt collection agencies will need to inform customers that there are debt advisers available across the UK whom they should approach.

After taking on an accredited advisor, whether this is the Citizens Advice Bureau or a commercial debt adviser, customers will be given a 30 day period of grace in order to reorganise and rearrange their affairs. At the end of the day, it is in the best interests of customers, credit card companies and debt collection agencies to ensure that customers are given sufficient opportunity to rearrange their assets and offer a repayment program. Writing off substantial amounts of debt is not the most favourable course of action which credit card companies wish to take although in some circumstances they have no alternative.

It will be interesting to see how the 30 day cooling off period works in practice as it seems a very sensible and fair way forward.

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