In the UK, say Mr. Jones has a bad tenant and in getting him evicted racks up costs of £50,000. If the court rules in favour of Mr. Jones that the bad tenant owes him £50,000, is it possible to sell that debt to a collection agency?

Is it also realistic that any debt collection agency would want to buy it?

  • It is important to note that the legality of this transaction pre-judgment and post-judgment is quite distinct in the U.K. Pre-judgment it is easy to run up against prohibitions against champerty in the U.K. and the law regarding what is and is not champerty are not at all logical and obvious.
    – ohwilleke
    Jun 11 '17 at 22:18

Yes, you can sell an interest in a debt; this is an alternative to paying a debt collection agency on recovery.

The contract that you have with the debtor may have limitations of the transfer of rights and obligations under the contract that may prevent this.

The value of the debt to the agency depends on the status of the debt and the credit worthiness of the debtor. If you have a judgement debt from a court, they don't come any more rock solid than that - the only limitation is the debtor's ability to pay. If the debtor has assets or a solid income stream an agency may pay 70-80% of the face value of the debt.

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