default notice - next steps?

[edinburghbeerbucket]

Hi folks,

 

I've been away from the forums for a while, but keeping up-to-date with the newsletters.

 

I have a credit card with Bank of Scotland. I've had it for several years, and I'm now in a situation where I owe around £2500, and they owe me around £1500 in bank charges (which I have almost won - just waiting for the extract decree) and another dispute which is being handled by the FOS.

 

Things have been extremely tight recently, and the wife and I have been living on supernoodles towards the end of the month! As a result, I've just not been paying the card for about 3 months.

 

I've written to them several times explaining the situation and suggesting that they freeze interest and charges on the account while the bank charges and the other issue are resolved, and then we can come to an arrangement to pay the outstanding balance. I also asked them to stop calling because I live abroad and they keep calling at midnight, 4am, etc.

 

So far they've ignored all the letters, and today I got a default notice through the mail. I know they have received the letters because the last person who called acknowledged receipt of the latest one.

 

What should I do?! I really don't want this to go to a debt collector, and I'm trying to negotiate with the bank, but they don't reply to my letters and for obvious reasons I don't want to talk to them on the phone.

 

Please help!!

[conar686]

ebb

 

In response to their default letter send them a CCA request letter N from link below (do it today) and inform them the account is now disputed.

 

Whilst the account is dispute they are not allowed to take any enforcement actions this includes placing a default on your credit record.

 

http://www.consumeractiongroup.co.uk/forum/general-debt/20758-creditors-dcas-letter-templates.html

 

Include in the letter a a request for everything to be in writing and stop calling or accepting calls from them. Also include a request for their complaints procedure.

 

After all that just wait the 12 + 2 days and no agreement arrives they have defaulted & you can stop paying them. After + 31 days and no agreement then they have committed a criminal offense and you report them to their local Trading Standards.

 

If an agreement does arrive post it here an ask the guys if its enforceable

 

http://www.consumeractiongroup.co.uk/forum/general/33174-consumer-credit-act-agreements-444.html

 

If they pass it off to a DCA then send them a CCA as well.

[edinburghbeerbucket]

Thanks so much for the advice. I'll get onto the CCA request tonight.

 

I have a concern, though. In my last couple of letters to them, have I acknowledged the debt by offering to make make repayments? I don't have the letters to hand (I'm at work - tee hee!) but I remember something along the lines of "I am keen to repay the outstanding balance...".

 

Or, does sending this letter effectively make those previous statements null and void?

[car2403]

I'm not sure I understand - what are you trying to achieve here? Surely they are doing you a favour in defaulting/terminating the account, as it probably will go to DCA who is more likely to accept a reduced payment offer - thereby making your situation more bearable.

 

Denying the debt exists isn't really an option as you've being paying the account for some time.

 

While conar686's advice might work, I would advise against it unless you have a legitimate concern over the account such as no CCA agreement, etc. Using this to prevent the account being defaulted may backfire on you later, IMHO.

 

Disputing an account because you have concerns over it's enforceability is one thing, but disputing it as a means to prevent collection is another!

[edinburghbeerbucket]

I'm not sure I understand - what are you trying to achieve here?

 

Ideally, I want them to stop applying interest and late fees to the account and freeze it.

 

I want it to stay like this until such time as my disputes with them have been settled.

 

Then, when we have agreed on the outstanding balance, I want to start paying it back at an affordable rate.

[car2403]

The agreement you have with them (or terms in another document that is referred to in the agreement) will allow them to do this though - what you're asking them to do is at their discretion, so if they won't, they won't and you can't make them.

 

The only thing you can do is exactly what you have - tell them about your situation, the reasons it's come around (include the fact you think their charges are part of the problem!) and what you are able to offer comfortably.

 

They don't want to terminate the account, but they don't have to accept reduced payments.

 

If this doesn't work and - depending on your other circumstances - you can't get anywhere with them, you might want to consider involving the CCCS/Citizens Advice Bureau who can help you manage your debt or involve you in a Debt Management Program. (DMP) These shouldn't be entered in to lightly, but at least if the CCCS/CAB are involved they may be more inclined to accept. (I know Barclays can decide not to accept any version of Income/Expense without these being confirmed by such a third party)

 

Your disputes are a separate issue to the account collection, though - they aren't dependant one on another neither. You owe the money, they are entitled to default/terminate and sell the debt on - the fact you're querying it will prevent collection, but bear in mind you may not be entitled to those charges/fees back as you might not win, (unlikely, but anything is possible!) so don't rely on it.

[edinburghbeerbucket]

Thanks for your honest advice, Car.

 

The frustrating thing is, if the bank gave me this breathing space they'd eventually get back the whole balance instead of selling it to a DCA for 30p in the pound or something!

 

As it stands, it's actually far more beneficial to me to let the account default and go to a DCA, negotiate a 40% settlement with them, then wait for my bank charges (etc) to come back to me and pay it off with that!

[car2403]

If you are defaulted (have a default registered on your credit file - they may "default" your account, but not record it!) you need to challenge this in your claim for charges.

 

If you can show - as you can - that the majority of the balance is made up of charges that are proven illegal, you can ask the Court to make an order under S.14 of the Data Protection Act 1998 to have the default removed, if BOS won't agree. (You may need advise from others on this, as you're probably governed by Scottish Law, though)

 

If they settle with you, make sure it's conditional on complete removal of the default not just marking it as satisfied/settled. (A satisfied default will still adversely effect your credit rating)