The complete guide
Debt recovery: how creditors actually get paid in the UK
Debt recovery is the whole journey from "they owe me" to money in your account — the demands, the leverage the law gives you, and the escalation routes when a debtor won't engage. This guide covers the process end to end, what it costs, and the deadlines that quietly decide whether you recover at all.
Debt recovery vs debt collection: is there a difference?
In everyday use they overlap heavily. Where a distinction is drawn, debt collection usually means the chasing itself — demands, calls, negotiation — while debt recovery is the wider process that also includes legal action and enforcing judgments. In practice you don't choose between them: a good recovery starts as collection and escalates only as far as the debtor makes necessary. Roughly nine in ten recovered debts never see a courtroom.
The debt recovery process, step by step
STAGE 1
Chase and formalise
Reminders, statements, a firm phone call — and getting your paperwork straight: contract or terms, invoices, delivery or work evidence. Most recovery is won on documents you already have.
STAGE 2
Letter before action
A formal demand setting out the debt, the deadline and what happens next. It's a required step before court — and it resolves a large share of debts on its own, especially arriving on an agency's or solicitor's letterhead.
STAGE 3
Add what the law gives you
On commercial debts: statutory interest at 8% plus base rate, and £40–£100 fixed compensation per invoice. Delay becomes the debtor's expense, not just yours.
STAGE 4
Instruct recovery
A collection agency applies structured pressure — demands, negotiation, escalation — on a fixed fee, a commission, or a hybrid of the two, agreed up front. This is where most creditors get paid.
STAGE 5
Court claim
If demands are ignored, a county court money claim turns the debt into a judgment (a CCJ). Undefended claims are largely procedural; a genuine defence turns it into litigation.
STAGE 6
Enforcement
A judgment isn't money — enforcement is. High Court enforcement for judgments over £600, attachment of earnings, third-party debt orders, charging orders: the right tool depends on what the debtor has.
Each stage exists to make the next one unnecessary. The single biggest factor in your favour is speed: debts under 90 days old collect far more easily and cheaply than debts past their first birthday.
DIY, agency or solicitor?
| Route | Typical cost | Strongest when | Watch out for |
|---|---|---|---|
| Do it yourself | Your time + court fees | Small, undisputed debts; debtor still engaged | Chasing drift; procedure mistakes; being ignored |
| Collection agency | Fixed fee, commission (5–15%) or hybrid | Most commercial debts; ledgers; tracing needed | Unvetted operators; fees not defined in writing |
| Solicitor | Fixed fees to hourly rates | Genuinely disputed or high-value debts; injunctive urgency | Costs outpacing small debts |
Full pricing breakdown: what a debt collection agency costs. For the agency route, we match your case against a vetted panel — free, and the agency's fees are set out before you commit.
Time limits: the quiet deadline
In England, Wales and Northern Ireland, most simple debts become unenforceable six years after the debt fell due or was last acknowledged. In Scotland it's generally five. Long before those cliffs, recovery odds decay month by month — debtors move, companies dissolve, evidence fades. If a debt matters, it matters now.
Scotland and Northern Ireland do it differently
Scotland has no CCJs — court action means a sheriff court decree, enforced by sheriff officers. Northern Ireland routes enforcement through the Enforcement of Judgments Office. Where your debtor is decides the playbook — see our region-by-region guides.
Go deeper on your situation
Unpaid invoices
The most common commercial debt — and the easiest to leave too long.
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Rent arrears
Current and former tenants, tracing, guarantors and CRAR.
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CCJ enforcement
You won the judgment. Here's how it becomes money.
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Your sector's playbook
Construction, recruitment, haulage, freelance and more — each trade's levers.
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What it costs
Fee models, typical rates and how statutory add-ons offset them.
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Late payment calculator
Work out the interest and compensation you can add today.
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Statutory interest rate tracker
The current rate, how it's set, and every historical period.
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Answers for your exact situation
Every recovery starts as a specific problem. Pick yours:
First steps
Adding pressure
Court & enforcement
Tricky situations
- How old can a debt be and still be recovered?
- The debtor disputes the debt — now what?
- The company that owes you money has gone bust
- Recovering a personal loan — money lent to a friend, family member or individual
- Your tenant moved out owing rent — recovery, step by step
- How to find someone who owes you money
- When is a director personally liable for a company's debts?
Debt recovery questions, answered
What is debt recovery?
Debt recovery is the process of getting money you're legally owed actually paid — from chasing and formal demands through to court judgment and enforcement. It covers unpaid invoices, rent arrears, loans and any other sum due under an agreement, and it can be done yourself, through a debt collection agency, or through solicitors.
Is using a debt recovery agency legal?
Completely. Recovering money you're owed is a legal right, and reputable agencies work within clear rules — no harassment, no misleading claims, contact at reasonable hours. Consumer collection is FCA-regulated; commercial collection is governed by contract and court rules. Vetting is exactly why our panel exists.
How long does debt recovery take?
Straightforward debts often resolve within days to a few weeks of a professional demand — most debtors pay before anything reaches court. A defended court claim can take months, and enforcement adds more, which is why the age of the debt matters: fresh debts settle fast, stale ones fight back.
Can I recover my costs from the debtor?
Partly, and sometimes mostly. On commercial debts you can add statutory interest (8% plus the Bank of England base rate) and £40–£100 fixed compensation per invoice. Court fees are generally added to a judgment, and most High Court enforcement costs fall on the debtor. Agency commission usually comes out of your side — but the add-ons often cover much of it.
What if the debtor has no money?
Then the honest strategy changes: means enquiries and tracing first, enforcement only where there's something to enforce against, and securing the debt (for example with a charging order against property) where patience beats pressure. A debtor with nothing today isn't a debtor with nothing forever — judgments last years.
General information, not legal advice. CompareDebtRecovery is a comparison and introduction service, not a law firm.
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