Need advice with credit card debts please

[JD2009]

Following redundancy in late 2007, a significant period of unemployment and then having to take a job with a much reduced income, I now find myself unable to meet my two large credit card monthly payments, with no means of meeting these commitments in the foreseeable future.

 

The totals are £15,000 (Bank of Scotland) and £21,000 (Abbey).

 

Having read through the forum for a while now, I did send the CCA request letter to Abbey (which I note is run through MBNA) by Special Delivery with a £1 Postal Order, but never got a response. The 12+2 day period has long expired, however, I have so far not sent the next letter as I suppose I am fearful that if it transpires that the agreement is enforceable and I have to then negotiate with them, this action may influence their "helpfulness" in accepting reduced payments and freezing interest.

 

Matters are now extremely pressing. I did manage to pay this month's minimum to Bank of Scotland, but simply do not have anything like the £400+ minimum payment Abbey require in a few days.

 

I suppose I have been putting off the inevitable for a long time now in the forlorn hope that I could find more lucrative employment, but in the present climate I have realised that I was being overly optimistic and "crunch time" has arrived.

 

From reading previous posts I am aware that MBNA in particular are not very good at finding original agreements, but does this apply to Abbey whose credit card is run through MBNA?

 

Would the considered opinion be:

 

1. To send the follow up letter advising that they have failed to comply with my request for the CCA, advising that the account is clearly in dispute and cease payments for the time being, or

 

2. Bite the bullet and write to them offering token payments and asking them to freeze interest? Even then, unless they offered to refund the huge amount of interest I have already paid to them over the years (the account was taken out in approx. 1995 at an Abbey branch), the debt would never be repaid in my lifetime.

 

I am so confused as to what the best course of action would be and for my sanity need to be at least doing something.

 

Any advice at all will be very much appreciated.

 

Thanks in advance.

[dx100uk]

you will never get interrest back unless it is solely the result of unlawful charges

[have you considered reclaiming, as i bet its a pretty sum for such an old set of a/c's]

 

if neither have satisfied the cca then send the letter & cease payment.

 

however i admire your stance of not running away from your debts.

 

making a token payment is easy.

 

just fire off a letter TELLING them, you will only be paying £XX for xxmts.

and could they please as a goodwill gesture freeze the interest & refrain from adding charges.

 

keep doing it regardless to all their threats!!

 

if it EVER got to court the judge will laugh it out the door & not award a greater payment, prob less!!

 

both co's know this

 

good luck

 

dx

[JD2009]

Hi dv100uk and thanks so much for responding.

 

Am I correct in saying that you're suggesting it would be best to use a two pronged approach - i.e. send the CCA request letters AND (separately) send letters telling them I can only pay £XX?

 

I have yet to send the initial CCA request to Bank of Scotland, but did send a CCA request to Abbey just over a month ago, so they've definitely had more than the 12+2 days.

 

Minimum payments to date have always been made and on time, but this simply cannot continue and it is extremely disheartening to see that my payments for so long have merely covered their interest and made no inroads at all into the debts themselves (literally thousands of Pounds).

 

To further compound matters, in the last year or so, both companies have increased their rates substantially (more than doubled in one case) "following a review of my account" which has only made matters far, far worse for me. Before I lost my previous job and for a while after, I was always being tempted by both companies offers of interest free periods, increased limits and all the usual offers. Yes, I know I have incurred the debit balances, but it would be very interesting (pardon the pun! ) to know how much of the outstanding balances comprise their interest charges.

 

I suppose I have been far too optimistic and obviously far too easily led by their previous "offers", but it does boil down to the over enthusiasm of these companies over many years to tempt people with increased limits etc. without any assessment as to whether the customer's circumstances justify the ridiculously high limits given and then to cripple the customer by hiking rates just at the time they could least do with it. I suppose the above is me stating the obvious and I apologise for that.

 

Thanks again for your advice, any further advice will be very much appreciated.

[dx100uk]

right so send abbey reduced offer, like it or lump it . and /or account in dispute letter.

 

cca BoS

 

 

dx

[loobyloo85]

Hi

 

Based on your level of debt, have you considered an IVA or DMP to help resolve your finances?

Having a company acting on your behalf may just be what you need to relieve the pressure.

For the IVA, you would need about £100-£150 surplus, and for DMP you can pay in what you can afford. There are free companies out there to help. xx

[JD2009]

Hi

 

Based on your level of debt, have you considered an IVA or DMP to help resolve your finances?

Having a company acting on your behalf may just be what you need to relieve the pressure.

For the IVA, you would need about £100-£150 surplus, and for DMP you can pay in what you can afford. There are free companies out there to help. xx

 

Hi loobyloo85 and many thanks to you and dx100uk, your replies are so very welcome.

 

I have completed the Debt Remedy questionnaire via CCCS and this suggested calling them to discuss options, which I have yet to do yet as I am at work during their opening hours and calling from work is not a viable option. I suspect the option of an IVA may be a possible suggestion, but am worried that bankruptcy may be their advice, which I am desperate to avoid at all costs. At present the available surplus after payment of priority debts is probably only £100 at best, but I am actively looking at making more budget reductions to give me more surplus, so an IVA may be possible.

 

I think that dx100uk suggestion will be my initial starting point and see what transpires. That said, I just hope that such action will not backfire if an IVA is CCCS's suggestion. I don't see why it should if I make at least a monthly nominal payment as a gesture of my best intentions, but I must admit that it does worry me.

 

Thanks again folks for the advice.

[dx100uk]

also just be aware that cccs was setup by the banks, so will ultimately have them to heart.

 

payplan is a much better charitable institution with no ties.

 

me, i'd do it myself.

 

dx

[JD2009]

also just be aware that cccs was setup by the banks, so will ultimately have them to heart.

 

payplan is a much better charitable institution with no ties.

 

me, i'd do it myself.

 

dx

 

Thanks for the advice again.

 

I wasn't aware that CCCS was set up by the Banks and from what you say I think payplan will be my choice if it comes to that. For the meantime, my thoughts are that I'll try dealing with things myself in the first instance and will post updates on this thread if that would be okay?

 

Must say that I'm still feeling very apprehensive, but definitely not as desperate as I was before I found CAG and in particular your helpful and reassuring posts. Thanks again.

[JD2009]

"Abbey" have now written in response to my request for the CCA Agreement, over two months after my initial request was sent.

 

IMHO their letter is a nonsense:

 

"Thank you for your recent request.

 

In accordance with section 78 of the Consumer Credit Act 1974, we enclose a copy of the credit card agreement (original and current) including applicable terms and conditions and your most recent statement of account. I can confirm that a copy of the original credit agreement has been requested for you and should Abbey be able to provide us with a copy, we will forward it to you.

 

It may be helpful to explain that we are not required to serve a copy of the credit agreement which includes signatures, as the law expressly permits lenders to omit signatures from copies of all credit agreements. What we have to send to you is a true copy containing all the necessary material terms and conditions.

 

For avoidance of doubt, all the necessary and prescribed terms are included in the enclosed credit agreements.

 

If anything needs clarifying please call us on freephone 0800 068 3558 Monday to Thursday 9am-9pm, Friday 9am-6pm and Saturday 9am-1pm.

 

Yours sincerely

 

Gail Powell

Customer Advocate Office"

 

My initial points are:

 

 

• Their only enclosures are a copy of MBNA letter dated 30 April 2009 addressed to me but never received saying: "Thank you for getting in touch with us. We're pleased to enclose a copy of your most recent terms and conditions." and a copy of MBNA terms and conditions - [i took the card out around 1995 via Abbey not MBNA] - and the copy of my last statement.
  
• There is no "copy of the credit card agreement (original and current) including applicable terms and conditions" that Abbey's covering letter refers to.
  
• Surely their statement that "all the necessary and prescribed terms are included in the enclosed credit agreements" is a nonsense, as firstly they have not provided any "credit agreements" and if they mean "terms and conditions", then the one provided relates to current MBNA terms not the original Abbey terms.
  
• The letter quoted in full above is on Abbey letterhead, yet the text refers to "a copy of the original credit agreement has been requested for you and should Abbey be able to provide us with a copy ...." from their wording I presume the letterhead should be MBNA not Abbey.
  

 

I would be extremely grateful if someone would point me in the right direction as to how best to word a reply.

 

Many thanks in advance.

[dx100uk]

account in dispute letter

they failed to produce within 14 days

snd

they failed to include all that is necessary n replyto a cca request

 

just have a quick read inthe mbna forum,you'll see what youhave is a std reply as such

 

dx

[JD2009]

account in dispute letter

they failed to produce within 14 days

snd

they failed to include all that is necessary n replyto a cca request

 

just have a quick read inthe mbna forum,you'll see what youhave is a std reply as such

 

dx

 

Thanks dx100uk.

 

Is there any chance you could post a link for the "account in dispute" letter and or the "MBNA Forum"? (I thought I had the letter thread saved, but cannot for the life of me find it:rolleyes:)

 

Thanks again.

[dx100uk]

MBNA - The Consumer Forums

 

it will be there

just do some reading on like threads

 

dx

[JD2009]

MBNA - The Consumer Forums

 

it will be there

just do some reading on like threads

 

dx

 

Thanks for the link dx100uk.

 

Today I've received Abbey's response to my letter requesting they accept significantly reduced payments and freeze interest and charges.

 

The answer is that they "cannot agree to any reduced payment plan as I have made recent non-essential purchases". This is despite my not having used the card at all for a couple of months and having already opted to destroy the card at their instigation, as they were going to up my interest rate to 35 percent if I didn't agree (this was despite having made full payments up to that time and never going over limit). I am at a stage where I simply cannot pay anymore than I was offering.

 

I am debating whether I should just send the Account in dispute letter previously suggested or also send the letter asking them to reconsider my offer of reduced payments.

 

Sorry to be a pain, but I'm desperate for guidance.

[cosalt]

Thanks for the link dx100uk.

 

Today I've received Abbey's response to my letter requesting they accept significantly reduced payments and freeze interest and charges.

 

The answer is that they "cannot agree to any reduced payment plan as I have made recent non-essential purchases". This is despite my not having used the card at all for a couple of months and having already opted to destroy the card at their instigation, as they were going to up my interest rate to 35 percent if I didn't agree (this was despite having made full payments up to that time and never going over limit). I am at a stage where I simply cannot pay anymore than I was offering.

 

I am debating whether I should just send the Account in dispute letter previously suggested or also send the letter asking them to reconsider my offer of reduced payments.

 

Sorry to be a pain, but I'm desperate for guidance.

 

Hi JD,

 

Just bear in mind that if they took you to court ( and that is a long way off ) the judge would only make you pay what you could comfortably afford after your priority expenses.

 

They are just trying it on, pay them what you can afford, if its only £1 then so be it.

 

Cosalt

[JD2009]

Hi JD,

 

Just bear in mind that if they took you to court ( and that is a long way off ) the judge would only make you pay what you could comfortably afford after your priority expenses.

 

They are just trying it on, pay them what you can afford, if its only £1 then so be it.

 

Cosalt

 

Thanks Cosalt for the response.

 

I did expect that they would reject my offer having read other member's experiences. There is no way I can pay more than i have offered them, but my concern is that if I send the account in dispute letter now (as they have only provided T&Cs and not a CCA), are they less likely to agree to my request to reconsider my offer of reduced payments or should I send both letters?

 

I know it's ultimately my call, but would appreciate any thoughts from those with more experience of dealing with MBNA and the like.

 

Thanks again.

 

P.S.

 

I was thinking of sending the following in response to their letter rejecting my offer of reduced payments:-

 

"Thank you for your letter of concerning the above account.

 

I am sorry that you feel unable to accept the offer which I have made. The majority of my other creditors have accepted the offers made to them and I have commenced payments.

 

I cannot offer you more because I can only at present afford £x per month between all my other creditors, and it would be wrong to cease or reduce payments to my other creditors in favour of your company. The offer made to you is on a pro rata basis, as used by the county court.

 

In the light of the other creditors agreeing to my repayment plan, please would you reconsider the offer. As you will see, I have already made one payment of £x and will be making the payments in line with the offer to your company, on a monthly basis, as a gesture of goodwill.

Additionally, you have made no reference to my request to suspend any interest charges still accruing. Continuing to charge interest would not assist me in my present financial difficulties, and can only serve to increase my total debt.

 

As you are aware, I have already paid considerable sums in interest to the account. If interest charges continue, the monthly instalments I am paying will not even cover that interest. Also the co−operation of my other creditors who have agreed to freeze interest already would be put at risk.

 

I would therefore be grateful if you would reconsider your decision. This would mean that the monthly payments I make would actually reduce the balance outstanding to your company.

I can confirm that I have previously securely destroyed my card and any cheques held. If you would care to check your records, this followed your recent decision to increase the interest rate applicable if I did not agree to this action. (At that time my account was and never had been in arrears or over limit).

 

I would ask that my request be considered sympathetically and speedily in view of the considerable number of years I have had the account and what is recent hardship and in making this request, I would remind you of your duty to comply with conditions agreed in the waiver of July 2007 and continuation of July 2008 between yourselves and the FSA.

I look forward to hearing from you as soon as possible."

 

Any thoughts would be very welcome please?

Edited May 20, 2009 by JD2009
Added proposed letter wording

[cosalt]

Sorry if you posted this earlier, but how old is your mbna account?

 

I have not paid mbna a penny since last September, I CCA'd them and they sent me a couple of dodgy application forms, I have been disputing ever since.

 

They won't get a penny from me ( and my balances with them are over £25k ) unless they can supply a fully enforcable credit agreement...........I would rather go bankrupt..........

[cosalt]

Just seen your edit, wording seems fine, however they will likely just ignore it.......................

[JD2009]

Sorry if you posted this earlier, but how old is your mbna account?

 

I have not paid mbna a penny since last September, I CCA'd them and they sent me a couple of dodgy application forms, I have been disputing ever since.

 

They won't get a penny from me ( and my balances with them are over £25k ) unless they can supply a fully enforcable credit agreement...........I would rather go bankrupt..........

 

Thanks again cosalt.

 

My account was opened at an Abbey branch in 1995 or thereabouts, with a balance at present just over £20k. Does that change anything?

 

I take it that you would just send the Account in Dispute letter and not pay at all? (The thought of that scares the hell out of me). I was thinking of sending both the dispute letter and the request to reconsider my offer of reduced payments letter(separately) and see what happens. Any thoughts?

[JD2009]

Thanks again cosalt.

 

My account was opened at an Abbey branch in 1995 or thereabouts, with a balance at present just over £20k. Does that change anything?

 

I take it that you would just send the Account in Dispute letter and not pay at all? (The thought of that scares the hell out of me). I was thinking of sending both the dispute letter and the request to reconsider my offer of reduced payments letter(separately) and see what happens. Any thoughts?

 

Second thoughts are that I'm thinking of sending the request to reconsider my offer of reduced payments and, if a further negative reply is received within say 10 days, or no reply received, then I will send the Account In Dispute letter.

 

On the subject of the Dispute letter, I note that the version suggested in one of the threads states that no further payments will be sent unless an enforceable CCA agreement is provided. I wonder whether I should amend this to say that in the meantime I will continue to pay the offered reduced payments, or would that be "shooting myself in the foot"?

 

BTW cosalt, apologies if this appears nosey, but I note that you say you have not paid anything since last September and a few questions came to mind. Are MBNA continuing to charge interest or is this frozen? Do you just send the same dispute letter each time they chase you? I assure you I'm only asking as I am unsure what to expect in my own dealings with them.

[dx100uk]

tbh i would not send a letter requesting they reconsider your reduced payment, send them a letter TELLING THEM they are getting a reduced payment, it's YOUR money, you control it. I would also request that they join in your goodwill nature in addressing your financial issues at present & freeze all charges & interest. [you are ofcourse reclaiming the charges that you must of incurred?]

 

just outline for how many months approx & how much.

then DO IT WITHOUT FAIL EVERY MONTH.

 

use internet banking, they cannot refuse that, goes direct to the A/C.

 

 

if, and a big IF, it ever got to court, the judge would laugh them out the door & most prob assign a smaller payment.

 

they know this but will prob wriggle & threaten, IGNORE THEM & just keep paying.

 

good luck

 

we are all here to help

 

dx

[JD2009]

tbh i would not send a letter requesting they reconsider your reduced payment, send them a letter TELLING THEM they are getting a reduced payment, it's YOUR money, you control it. I would also request that they join in your goodwill nature in addressing your financial issues at present & freeze all charges & interest. [you are ofcourse reclaiming the charges that you must of incurred?]

 

just outline for how many months approx & how much.

then DO IT WITHOUT FAIL EVERY MONTH.

 

use internet banking, they cannot refuse that, goes direct to the A/C.

 

 

if, and a big IF, it ever got to court, the judge would laugh them out the door & most prob assign a smaller payment.

 

they know this but will prob wriggle & threaten, IGNORE THEM & just keep paying.

 

good luck

 

we are all here to help

 

dx

 

Thanks dx100uk.

 

I fully intend to keep paying the reduced payments whether they agree or not and I have already asked them to freeze interest, although they did not refer to this in their reply refusing reduced payments. I will be raising the issue again.

 

As regards charges, as far as I recall I have only been charged £12 twice or three times in the last couple of months, as prior to that the account was always kept within limit and minimum payments met (just!). Should I be claiming back these charges i.e. are they not entitled to charge if I'm over limit and/or paying less than the minimum payments?

 

My other question is whether I should also send the account in dispute letter at this stage, as they have only just replied to my CCA request which I sent on 2 March 2009 and have not provided the CCA agreement? (they have allegedly asked Abbey to look for the CCA agreement .... it would be good if they fail to find it! Here's hoping!)

[gbean2871]

Hi JD2009, I am in the exact same situation as you due to redundancies and now much reduced salary. I sent letters re reduced payments and the request to have interest and charges frozen to all three of my credit cards. 2 have come back to me already and tried to wangle more money out of me monthly in return for them freezing interest etc. I'm sticking to my guns however and will just be sending them the offer amount on pay day each month. The third however, appears to be ignoring me completely but I'll just put a copy of my original letter in with the next payment and stick to my guns with them too.

 

Funnily enough, MBNA have been the most helpful so far. My husband also has a credit card with them and they have offered to write off 75% of the debt!

 

I sympathise with you, as someone who always managed to keep on top and in control of everything - it's an awful feeling having to do this. But ultimately, 6 years down the line we should be almost debt free and can start building our credit again. Seems a long way off now but it'll pass.

 

Bloody recession and jobs cuts - such a nightmare eh. I have a case number and case manager with Payplan too - just as a bit of extra support when things get on top of me. They are really helpful.

 

I wish you all the very best and it's good to know that we are not alone in this.

 

gbeanx

[JD2009]

Hi JD2009, I am in the exact same situation as you due to redundancies and now much reduced salary. I sent letters re reduced payments and the request to have interest and charges frozen to all three of my credit cards. 2 have come back to me already and tried to wangle more money out of me monthly in return for them freezing interest etc. I'm sticking to my guns however and will just be sending them the offer amount on pay day each month. The third however, appears to be ignoring me completely but I'll just put a copy of my original letter in with the next payment and stick to my guns with them too.

 

Funnily enough, MBNA have been the most helpful so far. My husband also has a credit card with them and they have offered to write off 75% of the debt!

 

I sympathise with you, as someone who always managed to keep on top and in control of everything - it's an awful feeling having to do this. But ultimately, 6 years down the line we should be almost debt free and can start building our credit again. Seems a long way off now but it'll pass.

 

Bloody recession and jobs cuts - such a nightmare eh. I have a case number and case manager with Payplan too - just as a bit of extra support when things get on top of me. They are really helpful.

 

I wish you all the very best and it's good to know that we are not alone in this.

 

gbeanx

 

Hi gbean and thanks for the response.

 

I have not contacted Payplan as yet - at present my wife is only just returning to work on after a lengthy absence due to illness at which time she was only receiving SSP. Once we can accurately reassess our monthly income and outgoings I think it will be beneficial to speak with Payplan for their input, but at present I'm just trying to get my two unsecured creditors to accept our situation and not add to our woes by continuing to charge default fees and interest. Abbey (MBNA) are not at present interested in offering any help at all.

 

I realise now that during the period I was unemployed following redundancy in 2007, I was overly optimistic and Abbey's contention (in what was effectively a one line reply to my recent request to accept reduced payments and freeze interest) is that I made non-essential purchases during this time. I have to admit that, on occasions, some use of the card may be construed that way, but at the time the card was within limit and payments were being maintained. I did in fact manage to repay my Abbey balance in full in 2007 from my redundancy monies, but this was in hindsight a mistake, as my failure to secure new employment for almost 12 months thereafter meant that I had to rely on re-using the card to meet everyday expenditure. It seems I am being judged by them entirely on the basis of what must total only a very small percentage of the outstanding balance.

 

I have written again today asking them to reconsider my offer of reduced payments and also to freeze interest, but frankly don't hold out much hope that they will agree.

 

They have still to provide a CCA agreement (requested by me on 2 March 2009!), although in a seperate letter they say that they are attempting to trace this (I bet they are!). I have already been advised by other very helpful members here at CAG to send the Account In Dispute letter as they failed to comply within 14 days and still have not provided what is legally required, however, I am so concerned that this will only serve to escalate their unhelpful attitude even more. My current thoughts are to wait say 7-10 days to see if they respond any more positively to my letter requesting they re-consider my offer and if no response or a further negative response is received, then send the dispute letter (but continue making the reduced nominal payments I have offered).

 

I'm impressed that your husband has received an offer of a 75 percent reduction in balance owed. Even if this was my situation, I simply could not raise the 25 percent lump sum they would require). Still ,well done in at least getting them to offer this to him).

 

I really don't know where or when this will all end, but as you say, it is good to know that we're not alone in this.

 

I sincerely wish you the best of luck in resolving your own difficulties.

 

JD2009

[JD2009]

Have now received my latest statement from Abbey, which includes 2 x £12 charges (£12 for late payment = one day late! and £12 for paying less than required minimum payment) and demanding immediate payment of effectively two month's minimum payments at £880+

 

I've now sent them a letter requesting they reconsider the reduced payments I have already started making and to freeze interest.

 

I'm still wondering whether I should delay sending the Account In Dispute letter now, as they have failed to provide a CCA Agreement, or wait to see if I get a more positive response to my letter asking them to reconsider my offer.

 

The other question I have is whether I should leave in the sentence in the Account In Dispute letter stating that no further payments will be made (but still pay them the reduced amount I have offered) or should I amend or delete that sentence?

 

Any advice please?

[Dotty50]

Hi JD

 

I too, like many others on here am in a similar position and you can spend hours reading all the threads and find such helpful and useful information but you still worry what do do for the best, don't you?

 

I have written for 5 CCA's and had 3 responses, 1 appears to be enforcible and the other not and 1 stating they need more information to trace the account. Have yet to receive any reply from 2 with MBNA but that seems to be par for the course with them.

 

However, I was interested to read that your OH has been offered such a huge reduction to settle. I would be very interested to find out how he managed that. Perhaps you could elaborate on this, as I am sure a lot of readers would find this very useful.

 

My MBNA cards are with Virgin and the other was previously Beneficial which then changed to HFC and is now with MBNA.

 

Idainfife gave me a very helpful reply and I will make further steps this week to send the 'Account in dispute' letter.

 

Will follow your thread with interest.

 

Good luck!