That has made me feel a bit better, once again thanks for your help.

Great thanks for that, I feel reassured now! Although they have tried to phone me, but didn't leave a message... I just know it was them! The only thing I am slightly worried about is that when I spoke to Loyds TSB about this debt, they said if Allied sent it back to them they would then SELL it to another debt collectors, which would be worse for me.

Since my last post I have sent a CCA request and a telephone harrassment letter, but on the day I sent a letter they phoned me to ask when I would be paying £1,500 and then they could set up a monthly agreement. Since then I have talked to Consumer Credit Counselling Service, who are a charity and offer their services free, I was on the phone to them for an hour! (it's a freephone number), and they were very helpful, told me not to pay them the £1,500, that the law is on my side and that before it goes to a charging order, it will go to court and a judge will make a decision on what I can afford to pay. I have a telephone appointment with them at 5pm tomorrow. CCCS - Free Debt Advice from the UK's Leading Debt Charity I am dreading tomorrow though as Allied are expecting a payment, will just have to not answer the phone I guess! (That's if they phone!)

Gosh that was quick! No one else yet!

Great have found that, am just starting to find my way around this website/forum. Would I put on this Harrassment Letter, problems with my health, have got my anxiety back, had panic attacks and only 3 hours sleep a night!

great thanks for that, but what do I put in an harrassment letter, would be great if you could send me a tempolate or something.

I am having trouble with Allied too, it too is a Lloyds TSB Loan that I took out years ago, and defaulted on it about 1999, it went to their solicitors and I had been paying them about £40.00 a month, and got the loan down to £7120, from about £10,000. Unfortunately I have not paid them since September 2008, and although I contacted Lloyds solicitors in December to say I would make a payment, due to my financial situation, especially after Christmas I was unable to make a payment. On the 27th Feb 2009 I received a yellow card from Allied demanding the full £7120, when I contacted them they said I would have to pay the amount in full, but they would reduce it down to a settlement figure of £6,000. They threatened that they would put a charging order on my property which meant I would not be able to sell it (I currently have it on the market), and they would take action to repossess the house (for £6,000), and then take further action for bankruptcy...nice! I tried to get another loan from Yes Credit but because of a poor credit score was rejected, they then passed me over to a debt management company called Money Worries, who say they can arrange to pay off my debtors, they have told me not to pay Allied anything, until they talk to them. In the meantime Allied have now said that Lloyds TSB will accept 20% of the debt £1,500, which we have managed to borrow from family, but they want that by Friday 3pm, at the latest or legal proceedings will start. Sorry about the long e mail, and all this has happened in 2 weeks!