To say that humans fear debt would be a colossal understatement - we truly dread it. Just the sound of the word "debt" or the sight of a Moorcroft debt collection representative is enough to make some people quake with fear, even though they owe nothing to anyone. But can we blame them? The global consensus is that debts are bad (even though we all still embrace its harbinger - loans), and if you fancy your peace of mind, then you'd do absolutely anything and everything to avoid getting into it.

But, do you know what's actually intriguing? It isn't really the concept of debt that people fear, but the thought of what might happen to them when they fail to meet up with whatever agreement they have with their lenders. Simply put, what we truly fear isn't the concept, but the parties behind the concept - our creditors.

But while the world today will give you a million reason to dread debts and fear your creditors, has it ever occurred to you that these claims could actually be a myth, or at the very least, a misconception? Yes, you read that correctly. And I can even assure you that the bulk of the stories you hear, about what a creditor can do to you when you fail to meet an agreement, is more of an exaggeration, rather than a fact.

The myth of what creditors can do to you when you miss payments

Below are some of the myths you've probably read or heard about the power of a creditor:

• Once you miss a payment, your creditors will make life unbearable for you by sending bailiffs to pester, disturb, and embarrass you.
• You'll be dragged to court once you default
• You may be sent to prison once you miss your payment for a month or two

But guess what; claims like these are nothing but an absolute MYTH. A lot of actions taken by creditors are tactics to encourage you to make prompt payments.

That said, we are now going to share with you some of the facts about what creditors can and cannot do, with the hope that this will help alleviate some, if not all, of the lingering worries and doubts you have about loans and debts.

What can creditors do and cannot do?

Chase after you

Yes, they have the right to contact you or chase after you in the event of defaults. But guess what they cannot do? They don't have the right to pester or harass you, which means that they cannot make life unbearable for you. In fact, even if they decide to chase after you with debt collection agencies, like Moorcroft, there is a limit to how far they can go. For instance, if you want, you can request that they can only contact you in writing. By law, they're not expected to call, visit, or contact you outside the time range of 6 am to 9 pm.

They can send collectors

If your debts are owed to creditors, like street lenders, individuals, or unions, they could send doorstep collectors to you. But, don't fret, these are not bailiffs, and they have no more power than someone ringing you. Like bailiffs, collectors aren't allowed to harass you; neither can they file a court case against you.

Add interest and charges to your debt

As your default term grows, your creditor might decide to add interest and extra charges to your account, as a way of penalizing you for defaulting. However, what they cannot do is to go ahead with this decision if it wasn't a part of the principal agreement you had with them, that is, they cannot penalize you for defaulting if they didn't clearly state it in their terms and conditions at the point of application.

Withdraw from your other accounts

If your creditor has access to your other accounts, they can deduct whatever you owe from these accounts. For example, say you owe some credit card debts to a bank, with whom you also have an existing checking or current account, they can decide to remove what's theirs from these accounts. But, as expected, you'll be notified before and after this is done.

They can issue a default notice

Once you miss up to 3-6 payments, your lender can send you a default notice, notifying you that your account is about to default. Failure to update this account within two weeks might result in the account entering default. Once this happens, it reflects on your credit history, and stays there for about six years, thereby making it extremely difficult for you to get credit within that time.

Finally, they cannot deny you the opportunity to renegotiate

Provided you have valid facts to prove that you're currently undergoing financial difficulties, and you may not be able to meet the principal agreements you had with your creditor anymore, your creditor is expected to sit across the table with you and discuss a new term. If you're lucky enough to owe an IVA debt, your creditor might be willing to cut you some slack and offer you some leniency by allowing you to renegotiate using the Individual Voluntary Arrangement (IVA) scheme. What your creditor cannot do is deny you the opportunity to renegotiate, if you have a valid claim.