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Egg Credit Card.. No Variable Rate/'Credit Limit' term


andydd
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Hi Folks.

 

I’ve been following some of the Egg Credit Agreement posts with interest, I took out a card in 2002 and I have just received back my Credit Agreement it seems the same as many others on here..(i.e. is signed, dated BUT uses the terms Limit and Approved Limit instead of Credit Limit, after reading many other posts it may seem that this is the point to argue that it is unenforceable. I notice that the T & C that ‘come with’ the credit agreement define ‘Approved Limit’ as ‘means the limit we set from time to time on the amount you can borrow from us on the Account’………has anyone any thoughts on this ?

 

I also notice that both the Agreement and the T & C’s list the interest and APR’s but nowhere is there any mention of the term ‘variable’, the T & C’s don’t mention (as far as I can see) that Egg may increase these rates, this would imply to me that the interest charged should stay the same as the original agreement, there is no scope for an an increase, again, has anyone any thoughts on this ?

 

Below is the letter I have prepared to send…

 

Dear Sir/Madam

 

Thank you for you letter dated XXXXXX, unfortunately the Credit Agreement you have provided does not comply with s61(1) of the CCA 1974 and the associated regulations and is therefore only enforceable by an order of the court by virtue of s65. However, since it does not have a term concerning the Credit Limit as required by Schedule 6 of the Consumer Credit (Agreements) Regulations 1983, the court would be prevented from granting such an order by virtue of s127(3).

I also note that the agreement quotes APR’s of 12.6% (for Purchases), 13.9% (for Transfer Balances) and 16.3% (for Cash Advances), however there is no mention within the Credit Agreement I received that these rates are variable and liable to change. The APR on my account has been increased numerous times and is currently 26.9%.

This account is now in legal dispute. Whilst the account remains in dispute, you are not permitted to ask for any payment, nor am I obliged to offer any payment to you.

 

Furthermore, whilst the dispute remains, you are not entitled to charge any interest on the account, nor make any further charges to the account. Additionally, you are not entitled to register any information on this account with any credit reference agency.

 

 

I am tempted though to remove the parts about the Credit Limit term and being in dispute and just ask Egg about the interest rate (the main problem with this account is the way the interest has been jacked up time and time again), if Egg don’t play ball then I may then mention the Credit Limit term and that the account is in dispute.

 

Any thoughts on this anyone ?

 

Andy

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Ive attached my Credit Agreement, also I have found in the T & C's (Clause 12. Changes) the part that would enable Egg to change the interest rate, although I guess it's still arguable that it is not mentioned in the Credit Agreement and are the T & C's actually properally 'attached' to the CA ?

 

Andy

Egg CCA 1.pdf

Egg CCA 2.pdf

Egg T&C.pdf

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Thanks..Although that deals a lot with PPI which I didnt take out ..I've seen mentioned in other posts reference to a '4 corners' rule...does anyone have an explantion of this ?

 

Thanks

 

Andy

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A valid credit agreement must contain certain terms within the signature document (s.60(1)(2) CCA 1974). These core terms are the credit limit, repayment terms and the rate of interest (SI 1983/1553 (6 Signing of agreement) which states that the prescribed terms must be within the signature document. (Column 2 schedule 6). s.61(1)(a) states the agreement must contain all the prescribed terms and be signed by both the debtor and on behalf of the creditor.

 

Further, s.127(3) CCA 1974 makes the account unenforceable if it is not in the proper form and content or improperly executed.

 

In Wilson and another v Hurstanger Ltd (2007) it was stated “In my judgment the objective of Schedule 6 is to ensure that, as an inflexible condition of enforceability, certain basic minimum terms are included which the parties … and/or the court can identify within the four corners of the agreement. Those minimum provisions combined with the requirement under s.61 that all the terms should be in a single document, and backed up by the provisions of section 127(3), ensure that these core terms are expressly set out in the agreement itself: they cannot be orally agreed; they cannot be found in another document; they cannot be implied; and above all they cannot be in the slightest mis-stated. As a matter of policy, the lender is denied any room for manoeuvre in respect of them. On the other hand, they are basic provisions, and the only question for the court is whether they are, on a true construction, included in the agreement

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