How does debt purchasing work?

At Lowell, we believe in being open and honest with our customers, working together to help you manage your debt. We understand that you might have questions about whether Lowell buys debt, how it works when a company purchases debt, and how we’ve come to manage your account.

We know the process can be complicated, so we’ve created a guide to explain how debt purchasing works, how we protect your data, and how Lowell will work with you to becoming debt free with us.

In this guide, we’ll cover:

• What is debt purchasing?
• Is Lowell a legitimate company?
• How do Lowell buy debts?
• How much do Lowell buy debts for?
• How will I know if Lowell have bought my debt?
• What happens once Lowell have bought my debt?

This content is intended to be an impartial guide regarding debt purchasing, specifically referring to how this works at Lowell. Lowell Financial Ltd does not offer legal or financial advice. You can find out more about the organisations you can contact in our guide on debt help and support.

What is debt purchasing?

Some companies choose to sell on debts to debt-purchasing companies like Lowell. Once Lowell purchases debt from another company, your debt has been 'sold' to Lowell - that means that we're the legal owners of that debt and any outstanding balance will be owed to Lowell.

Lowell buy debt from other companies and then manage those accounts with our customers. Lowell don’t collect on anyone else’s behalf – we’ll only get in touch with you if we’ve purchased your debt.

Lowell is an FCA regulated company. Debt is purchased by Lowell Portfolio 1 Ltd. Your debt and your account are then managed by Lowell Financial Ltd, a debt collection company, working on their behalf.

Is Lowell a legitimate company?

Lowell is a legitimate debt collection company, authorised and regulated by the Financial Conduct Authority (FCA). 

Our focus is on being open and honest in helping our customers work towards clearing their debt. Building trust with our customers and putting our customers first is at the heart of what we do.

Is Lowell regulated?

Yes – Lowell is authorised and regulated by the Financial Conduct Authority (FCA) for consumer credit-related activity. We closely follow the FCA’s rules and guidance to make sure that the service we provide for our customers is the right assistance for each individual customer. We’re here to help our customers to manage their accounts to help them to clear debts held by Lowell.

We’re also a member of the Credit Service Association (CSA), which is a National Trade Association in the UK for organisations in the debt collection and debt purchase industry.

The CSA have a detailed code of conduct that we adhere to when working with our customers, to help us ensure we achieve a fair customer outcome for every customer and every situation.

How do Lowell buy debts?

Debt purchase involves buying debt from product and service providers. Lowell purchases debt from lots of different companies, including:

• Financial services like credit cards, store cards, and Buy Now, Pay Later services
• Banking services like current accounts, unsecured loans, and overdrafts
• Utility providers like gas and electric companies
• Telecom providers like phone contracts
• Catalogue companies  

Outstanding debts can exist for a range of reasons. For example, it could be because payments weren’t made, or because there were additional fees and charges applied in line with the terms and conditions of the agreement or contract.

We have secure and robust processes for purchasing debt and managing our customer’s accounts. This means that we can get our customers up to speed as soon as the ownership of a debt transfers to us.

What happens if Lowell buys my debt?

If a company is owed an outstanding balance, they often have a contractual right that allows selling to a debt buyer or collection agency such as Lowell. If your debt is purchased by Lowell, we’ll work with you to help and support you to get your debt cleared. This may include setting up a payment plan that’s affordable for you.

During the sale and purchase of debt, Lowell always carries out due diligence to make sure that the information we’re being given is accurate and up to date. We make sure that all the relevant information has been included from the original creditor so that we can check the status of your debt and get in touch with you.

If you want to learn more, our guide to the debt collection process can explain more about how debts are collected. 

Why am I being contacted by Lowell and not the original company?

The reason Lowell are contacting you, and not the original company, is because we have bought your debt and are now the legal owners. This means that your debt now needs to be paid to Lowell, and not your previous creditor.

When we get in touch, this is because we want to work with you to set up a sustainable payment plan based on your personal circumstances.

It’s important to us that we’re able to help and assist you from day one of Lowell managing your debt. That’s why we make sure to track each step that we’ve taken and create an audit trail. If you do have any questions, we can check back on how your debt has been purchased and managed since being purchased by Lowell.

If you’ve been contacted about a debt you don’t recognise, get in touch with us. You might also find it helpful to read our guide to recognising if a debt is yours which includes information on whether you may be liable for a debt and the steps you can take to verify this.

We want to do all we can to ease your mind and would prefer to speak to you directly, but you can always contact us in writing with a Prove It letter to check whether a debt belong to you or not.

How much do Lowell buy debts for?

Lowell purchases debts from a variety of companies. The terms and conditions we use can vary depending on what kind of company we're working with, what kinds of debt are being bought and lots of other factors.

Once your debt has been purchased, we’ll get in touch to introduce ourselves. We can help answer any questions you have and support you with tools like our free budget calculator. Our goal is to work with you to assist you and help you on the road to settling your debt with us.

How will I know if Lowell have bought my debt?

If Lowell has bought your debt, you’ll receive a ‘Notice of Assignment’, or ‘hello’ letter from Lowell. You may also receive a letter to let you know that the original company have sold the debt to Lowell, sometimes known as a ‘goodbye’ letter, which may be sent in the same envelope.

The Notice of Assignment letter from Lowell will explain that we’ve purchased your debt, from this point on, we’ll work with you to explain the next steps.

We want to do all we can to ease your mind and would prefer to speak to you directly, but you can always contact us in writing with a Prove It letter to check whether a debt belong to you or not. You can read our detailed guide on Prove It letters here.

What happens once Lowell have bought my debt?

Once Lowell have purchased a debt, we work with our customers to support them in establishing a payment plan. At Lowell, we want to make sure that your payment plan is affordable and suitable for you, but you’re always in control of your payments.

We’ll help you with tools like our free budget calculator, which can help you to work out what payments would be reasonable and within your budget and then you decide what amount is right for you and how frequently you want to pay.

If your account is being reported to Credit Reference Agencies (CRAs), Lowell will take over the reporting. This means that your credit file will show Lowell’s name against the debt, rather than the original company.

What happens if I have problems with my debt?

Throughout your payment plan, Lowell will be here to support you. If you’re going through a difficult situation and it’s affecting your payments, we can help.

We might be able to pause your payments, or help you to get in touch with free, independent support. No matter what the situation may be, we’ll give you the time and space that you need while things are tough. For more information on the help and assistance we can offer, check out our debt support guide.

The debt purchasing process can be complicated, but we’ll always try to make it easy to manage your debt when working with Lowell. 

Get in touch with us today to speak to our friendly team and find out how we can help, or discover our helpful debt guidance hub for more information about Lowell.

Updated: 28th March, 2024