Consumer Debt & the Limits on Collection

What a creditor may not do — and where mortgage arrears go instead.

The court procedure for a consumer debt is broadly the same as for any other. Everything around it is different: the constraints on how payment may be demanded are criminal rather than advisory, and the commercial reality is that individual debtors are far more often unable to pay than unwilling.

Section 11, and What It Rules Out

Section 11 of the Consumer Credit Act 1995 makes it an offence to make a demand for payment by means calculated to cause alarm, distress or humiliation; falsely to represent that legal proceedings have been or will be issued; or falsely to imply official sanction or authority. In practice that rules out: threatening proceedings you do not intend to bring; implying criminal consequences for what is a civil debt; documents styled to resemble court papers; repeated contact designed to wear a person down; disclosing a debt to an employer, neighbour or family member; and language intended to shame. It is a criminal provision, not a code of practice — which is why a creditor should be at least as careful about the manner of demand as about the merits of the debt, and why any template found online should be read against it before being sent. Consumer protection legislation may also bear on the underlying agreement and its terms, and where the debt arises from regulated credit, further regulatory requirements may apply to the lender.

Mortgage Arrears, Assigned Debts, and the Practical Reality

Mortgage arrears on a principal private residence are outside the scope of this site. They fall under a distinct regulatory framework governing how lenders must engage with borrowers, including a prescribed process before enforcement steps are taken, and approaching them as ordinary debt recovery is simply wrong. Anyone in that position should take advice specific to it — and should know that free assistance is available through the Abhaile scheme, which provides access to financial and legal advice, and through MABS. On assigned debts: debts are routinely sold, and a consumer may find themselves dealing with an entity they have never heard of. That does not invalidate the debt, but it raises fair questions — was the assignment validly effected and notified, can the assignee produce the underlying agreement and a complete account, does the balance reconcile with what was originally owed? A portfolio purchaser frequently holds less documentation than the original creditor, and requiring them to establish the debt rather than assert it is entirely legitimate. And the commercial reality creditors most need to absorb: an individual with no means does not become solvent because a demand was firmer. Where genuine inability to pay exists, an arrangement recovers more than enforcement against someone with nothing — and spending money to establish that formally is money that could have funded the arrangement.

Consumer Debt, on Either Side?

For creditors: the constraints matter as much as the merits, and the arithmetic is different. For debtors: free independent advice from MABS comes before engaging anyone, including this firm.

Call 01 5827148

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Consumer Debt - FAQs

The court procedure is broadly the same, but the surrounding constraints and the commercial reality are quite different. Section 11 of the Consumer Credit Act 1995 places criminal limits on how payment may be demanded. Consumer protection legislation may bear on the underlying agreement and its terms. Where the debt arises from regulated credit, further regulatory requirements may apply to the lender. And practically, individual debtors are more likely to have limited means, more likely to be genuinely unable rather than unwilling to pay, and more likely to need arrangements rather than enforcement. A creditor who approaches consumer debt with the assumptions appropriate to a commercial ledger tends to spend money badly.

General information, not legal advice. This website contains general information about Irish law on debt recovery and enforcement. It is not legal advice and does not create a solicitor—client relationship. Every debt turns on its own facts — the documents, the dates, the parties and the debtor’s circumstances — and advice on yours requires a consultation. Statutory thresholds and figures referred to on this site are subject to change and should be confirmed before any step is taken.

A law firm, not a debt collection agency. Mary Molloy Solicitors provides legal advice and representation. It does not operate as a debt collection agency and does not conduct collection campaigns. Fees are agreed in writing with the client at the outset and are never calculated as a percentage or proportion of any sum recovered. In contentious business, a solicitor may not calculate fees or other charges as a percentage or proportion of any award or settlement.

No outcome is promised. Nothing on this site states or implies that any debt will be recovered, that any asset will be found, that any enforcement step will succeed, or that any claim will succeed. Recovery depends substantially on the debtor’s means, which are frequently unknown at the outset.

How payment may be demanded is regulated. Section 11 of the Consumer Credit Act 1995 makes it an offence to make a demand for payment by means calculated to cause alarm, distress or humiliation, or falsely to represent that legal proceedings have been or will be issued. Nothing on this site should be read as encouraging any such conduct. Mortgage arrears on a principal private residence are dealt with under a separate regulatory framework and are outside the scope of this site.

If you are the person being pursued. Free, confidential and independent money advice is available in Ireland from MABS, the Money Advice and Budgeting Service, and through the Abhaile scheme for people in mortgage arrears. You do not have to engage a solicitor to get help, and taking advice early generally improves the options available. This firm advises debtors in matters separate from those in which it acts for a creditor, and never both sides of the same debt — conflicts are checked before any substantive discussion.

Tax. Nothing on this website is tax advice. Questions about VAT on recovered sums, bad debt relief or the treatment of write-offs belong with your accountant or tax adviser and with Revenue’s own guidance.