Welcome Finance

[gvd]

Hi,

 

Need some help and guidance.

 

Me and my ex-wife took out a joint secured loan 2000/2001. Within a short period after that me and my wife seperated and my wife continued to live at the house and was paying all the bills etc. Within 12 month my ex-wife went bankrupt and the house was repossesed.

 

My mother gave me a letter today that was sent to her house ( not lived there since 1995. It was a dca for welcome finance saying that i failed to respond to previous letters (never rec'd anything til this letter) and that the full balance plus interest was due.

 

I am currently unemployed and cannot afford to make any payment at all and don't know how to proceed.

 

I can easily reseal this envelope and send back not at this address which is true.

 

I have never rec'd anything before at my current address or to my mothers house and I don't know how they got that address either.

 

What should/could I do?

 

Thanks in advance,

 

GVD.

[Chris_w]

I think the limitations act means they can no longer persue you for this debt. I'm sure someone will correct me if I'm wrong.

[gvd]

I am not sure about secured loans. I think they may be different.

 

 

 

GVD.

[Chris_w]

Have a read of 9 here

 

 

http://www.oft.gov.uk/shared_oft/business_leaflets/consumer_credit/oft664.pdf

[oneofakind]

Hi gvd, welcome to CAG.

 

It may very well be that this debt is 'statute barred' (ie unenforceable) because of the time that has passed. Do you have any idea when the last payment was made on this account? If it's over 6 years, it's barred.

 

Debt collectors often indulge in 'fishing', which is sending out lots of letters like this to people whose names and old addresses may be similar to yours.

 

Was the letter addressed to you or to your mother?

[gvd]

Hi ,

 

Thanks for wuick replies.

 

The letter was addressed to me at my mothers address.

 

I know it may make a slight difference that I am in Scotland.

 

It was a joint secured loan. I am 99% sure that my ex-wife went bankrupt in Nov 01 but will be able to find out the next time we speak and I am sure she didn't pay this for a couple of month before hand.

 

I was reading bits on the limitations act and about promisionary notes that may mean it's not barred after 6 years and was wondering with it being a secured loan on the house this would be classed as promisonary.

 

 

GVD.

[oneofakind]

If she was made bankrupt in 11/01, I'm sure you're right - the preceding payments would likely not have been made. It's October now, anyway. Limitations act gives a 5-year period in Scotland, I believe.

 

Not sure about this one... Joint application, one party bankrupt... I'd think they have the right to pursue you for the debt, but not sure whether it's enforceable.

 

Any Scots Law experts there? Rory?

 

 

EDIT: Forgot to say: obviously you shouldn't acknowledge the letter until you know where you stand, and on NO ACCOUNT do you (or your Mum!) EVER EVER EVER SPEAK TO THEM ON THE PHONE!

[sequenci]

I think I will need to get Rory on this one.

 

Just for the record, In England, a SECURED loan has a limitation period of 12 years for capital and 6 years for interest.

[gvd]

Thanks for replies.

 

So I am presumming it would be 12 years to be statues barred but no interest can be added after 5 years?

 

 

GVD.

[gvd]

EDIT: Forgot to say: obviously you shouldn't acknowledge the letter until you know where you stand, and on NO ACCOUNT do you (or your Mum!) EVER EVER EVER SPEAK TO THEM ON THE PHONE!

 

 

No worries there!

[sequenci]

gvd, I have requested for someone clued up in Scottish law to take a look as it may be very different up there. Hopefully they won't be too long.

 

Best wishes,

 

Seq

[oneofakind]

Info filed for future reference, Sequenci.

 

Thanks.

 

 

 

 

And... thanks for the click - whoever it was! Always appreciated.

[Robertxc]

Have a look here for Scottish limitation: http://www.consumeractiongroup.co.uk/forum/scotland/41999-20-year-claim-limit.html?highlight=burness

[rory32]

My understanding is that they have 5 years from the realisation of their loss (as per the link Robert has provided) provided the 5 years falls within the 20 year period. Obviously they realised that there would be a loss some years ago. However, this is just my understanding and I would seek some legal advice on this as the matter is a little complicated by it being joint and the sequestration of your ex.

 

You can get free legal advice from the Law Centres, hopefully the link to them should show up in my signature.

 

Which DCA was it that wrote to you? Some DCA's deal predominately in statute barred debts.

[gvd]

Hi,

 

Thanks Robert for the links but I have read it over a few times and it ain't sinking in to my thick skull. Can someone put it simper for me?

 

Rory,

 

I can't remeber as posted the letter back today NATA.

 

 

GVD.

[Robertxc]

Basically gvd, from the day they realised that they had a 'cause of action' they had five years in which to act on it. So...the day you breached your contract was the day they got a cause of action, which means that they have five years from that date to sue you.

 

Incidentaly, you will have to travel a long way before you find a DCA who will admit to ever having even heard of the Prescription and Limitation (Scotland) Act. The coupl of times I've sprung it on them they refused point blank to accept that such a thing even exists, and had to go and look it up. Oh, sweet, sublime moment it was when they had to acknowledge it...

[gvd]

Hi Robert,

 

So even though it was a secured loan on the house it is statues barred after 5 years and not 12?

 

If so a weight has been lifted of my shoulders.

 

Should I just still wait until, more if they contact me at my home address?

 

It's took them 6 years so far.

 

GVD.

[rory32]

12 years in only applicable in English law, so forget about 12 years. I would just wait and see if they contact you again.

 

If they do you can use the template letter here if you want Creditors and DCAs - Letter Templates & Budget Planner template M. You need to tweak it slightly as it's written for English Law.

 

Just substitute 5 years for 6 years and instead of the Limitation Act 1980 Section 5 put The Prescription and Limitation (Scotland) Act 1973 Part 1 Section 6. You may also wish to include the follow from the Act:

 

"If after an appropriate date, an obligation (an appropriate debt) has subsided for a continuous period of 5 years:

 

(a) without any relevant claim having been made in relation to the obligation, and

(b) without the subsistence of the obligation having been relevantly acknowledged;

 

then as from the expiration of that period the obligation will be extinguished..."

[Robertxc]

That's my understanding of it. However, DO NOT TAKE MY WORD FOR IT! It seems to run from the date of the first demand for payment.

 

This is what the Prescription and Limitation (Scotland) Act says about loans:

 

APPROPRIATE DATES FOR CERTAIN OBLIGATIONS FOR PURPOSES OF SECTION

6

 

2.—

(1) This paragraph applies to any obligation to repay the whole, or any part of, a sum of money lent to, or deposited with, the debtor under a contract of loan or, as the case may be, deposit.

 

(2) The appropriate date in relation to an obligation to which this paragraph applies is—

 

(a) if the contract contains a stipulation which makes provision with respect to the date on or before which repayment of the sum or, as the case may be, the part thereof is to be made, the date on or before which, in terms of that stipulation, the sum or part thereof is to be repaid; and

 

(b) if the contract contains no such stipulation, but a written demand for repayment of the sum, or, as the case may be, the part thereof, is made by or on behalf of the creditor to the debtor, the date when such demand is made or first made.

[gvd]

I thanks you guys soooooooo much!

 

I think I will just bide my time until they contact me at the correct address.

 

I have printed off the the info you have given to keep in my records just in case.

 

Next on my agenda it public right of ways...... search begins.

 

GVD.

[rory32]

Next on my agenda it public right of ways

Then you'll need to look at The Land Reform (Scotland) Act 2003 which amended the Trespass (Scotland) Act 1865.

[gvd]

Thanks Rory.

 

GVD.

[alexteh]

From my understanding of some dealings with Welcome Finance about a secured loan and a repossession, the moment the property is repossessed, the loan becomes unsecured. As the letter wasn't even sent to your house, I would ignore it and if they send another, don't open it and get your mother to just write "Not Known At This Address" and stick it back in the postbox.