United Kingdom consumer-credit regulation, with section 136 legal-assignment rules applying in England and Wales

Notice of Assignment: when a debt changes owner

Understand what a Notice of Assignment means when a debt is transferred, how legal ownership differs from collection and what to check before paying.

A Notice of Assignment tells you that rights relating to a debt have been assigned to another party. For regulated consumer credit, FCA CONC 6.5 requires notice where a lender’s rights are assigned to a firm, subject to the rule’s exceptions and timing provisions. A new debt owner may use a separate servicing or collection company, so the company contacting you is not necessarily the legal owner.

Legal owner and collector can be different

A debt purchaser may become the owner while another group company or collection agency services the account. Check the notice and subsequent correspondence for the exact legal entity that owns the debt and the entity authorised to collect it.

Section 136 legal assignment

Section 136 of the Law of Property Act 1925 provides a route for an absolute written assignment of a debt to take legal effect where express written notice is given to the debtor, subject to the statutory conditions and prior equities. This is a technical legal rule and not every transfer should be described as a section 136 legal assignment without checking the documents.

FCA notice requirement for regulated credit

CONC 6.5 says that where a lender’s rights under a regulated credit agreement are assigned to a firm, notice must generally be arranged as soon as reasonably possible, or by the first occasion the servicing arrangements change from the customer’s perspective where they initially remain unchanged.

What to check before paying

Confirm the original creditor, account reference, current owner, collector or servicer and the payment instructions on current official correspondence. If you do not recognise the account or the assignment conflicts with earlier records, ask for clarification before making a payment or admitting liability.

Related guidance

Important: This page provides general information, not regulated financial or legal advice. Rules and enforcement processes can depend on the debt, court, creditor and jurisdiction.