Help required on Bank Charges whilst on benefits **SUCCESSFUL OUTCOME**

[InformedSearcher]

Just some swift questions here. It's usual after 6 months has expired for debt collectors to be involved. You would also be made aware of what would happen as they progress by letter. From what you have said it would seem that the initial debt is not new so a few more details and what actually happened might be useful.

Somewhere in the small print there will be a clause that states they can move funds from an account with funds to repay the one that requires them. I would be surprised how JSA managed to be paid into a savings account as normal payments are by BACS and into a fully accesable 'current' account unless otherwise agreed. JSA by the way is taxable and counted as 'income' for that reason. You'll even get a P60 for the inland revenue for it at the end of the tax year. Contribution based JSA lasts for 6 months only and then means tested for 'income based'.

I think with all the details and time elements there are many here who could suggest and advise you accordingly.

MIchael

[InformedSearcher]

They will in fact be showing on the credit file a different amount in the 'default/delquent' box. That's nowhere near what you want as it'll still show as default. The problem is that it'll show for 6 years unless totally removed and it's only the the account holder (as in the bank) who can alter it.

The notice of dispute will last 28 days or until the bank reply either way. The reality is that a bank hates to adjust CRA entries once made. They believe they are always right which we all know is often in dispute.

You need take no rush to contact the DCA and you need to find out if it's 'in house' or 'external' and if the debt has been sold which is probably doubtful. Whatever happens your aim is to have the 'default' removed. By the sounds of it you have mitigating circumstances so there's a reasonable chance of them (reluctanly) backing down.

Whatever you do from now on, write down everything as in names, dates and times and the jist of your calls be they incoming or outgoing. Think I'm right in what I've said here.

Michael

[InformedSearcher]

JP08 ... that'll cost you £2 for the credit report snail mail. However they are doing a 30 day on line tempter for free so that might be an idea.

The credit report will at least show when the account became 'deliquent' and the overdue periods logged at it progressed. It certainly sounds to be well over 6 months of 'no action' though and you might like to have a close look at the default notice they'll have sent.

The banks normal reaction is that if there's no overdraft facility agreed and dependant on how much below zero would define the charges. Personally I'd have been on the phone to them immediately because not doing anything about it means the charges continue to pile up - aka the nightmare scenario.

Michael

[InformedSearcher]

Hi Michael

Thank you for this, I will do the 30 day online version. My son also received another letter back from the bank after the last letter. It is basically saying that although the refund request is currently on hold pending the outcome of the OFT test case, it does not prevent them from continuing to collect outstanding balances through it's collection process. They will be happy to discuss an arrangement if he calls their collection team. Obviously not going to call them but they have already had the £20 back plus £80 in charges. They are still accruing more charges every month currently another £187 and counting. His Jobseekers is not being paid in to that account. But with the charges still being added on even after the letter of dispute, I am wondering just how much it is going to rise to. I will go through their complaints process now.

Will keep you updated

Thanks JP

 

So your (you/)son has paid £100 into the account at an earler date but it did not bring it back into credit? HSBC penalties are under £10 a £10 charge and over £10 then a £25 charge. Letters of Dispute will not stop the charges because they will take them as being valid and correct. There would have been an original transaction that 'triggered' the 1st ever 'penalty'.

HSBC prior to applying charges send a letter to that effect. Has you son actually been given a default notice from them or is that default for something else? I get the impression that the default you mentioned earlier is for something else.

Michael

[InformedSearcher]

Hi Michael

Yes, £100 was paid to the account after finding out that he had a problem. We also requested that the rest of the charges be refunded to bring the account back to zero, as my son is on jobseekers. They ignored that saying that before the charges started he was having regular payments paid in so they were not going to refund them. He is at the moment getting no money at all apart from crisis loans as there is some problem with the DWP records. This account is Nationwide not HSBC?

He has had 2 letters from the internal debt collector saying it is in default and that it is affecting his credit rating, it is purely bank charges as the £20 has been paid off plus £80 in charges already.

JP

 

Well NW charge £20 a month for unauthorised overdrafts plus interest. If there was a DD/SO that caused this then an extra £30 too. Have you seen the Credit report yet? If I remember rightly the one you use will send you a snail mail (once only) activation code. Once you've looked at the credit file it should show everything and all make sense.

As far as their answer, they are really not interested in the slightest regarding when JCA started. Their simple rules are that it went into 'negaive' balance then the charges were added automatically. The real problem is time span.

Let's know what the results are. From that we can look at all the options and potentially sort it out. You have put in a claim though for unfair charges, as in the thing that's being heard by the Law Lords on 23rd instant - If not get that done - Loads of info on other threads of what it's all about and how to do it.?

 

Michael

Edited June 15, 2009 by InformedSearcher

[InformedSearcher]

Oh thought you were getting the on-line free deal?

The problem though is regarding the continuing monthly 'charge'. It will not stop however until a decison is made. It's that Credit File that's important to this as if their charge was £80 then that means 4 months had passed. Being on JSA or whatever (which I suspect after 6 months stopped) will not be a factor when they automatically enter the charge monthly. One would assume that the monthly £20 charge ceased once the account was declared 'in default'? Who did you make your complaint to?

Michael

[InformedSearcher]

Okay, well regarding JSA (in a nutshell) - one gets it for up to 6 months (contribution based). Then depending on their circumstances a means-tested income based method (if applicable) is used which will mean nothing(!) or something and advice.

Now for the results of the credit file, eagerly awaited.

Michael

[InformedSearcher]

Hi Michael

 

We received an unexpected result. When I complained to the bank, they reviewed the postion and have agreed to write off all charges going back to Sept 2008, and then close the account. As it was all charges that leaves a balance of zero to pay. So the credit file should show as settled? Still not got round to checking yet as he wasn't there at the weekend but it should change anyway if there is an entry on there, I am sending off the acceptance to the bank at lunchtime today.

 

Result!

Thank you for all your help.

JP

 

Great news! Pleased to hear the news and 'good on you'. Maybe they decided (at last) to look at accounts on their merits?

Regarding your credit file - You payment (or free starter) gets a single 'call' for the file and any others cost you. The file is not updated. 'Before' you send the acceptance ensure the word 'default' is removed from it (if it is there)!

Michael

[InformedSearcher]

One of the credit ref agencies has written saying that they are investigating why a default is on his credit file when the debt is in dispute and have added a note of dispute to it. If the bank do not give a satisfactory answer then they will take it off his credit file...

I await the next response. They are writing it off, so should clear this as well.

 

Is there a chance you could show this letter here (hiding of course all the personal details)? Individual details shown on CRA files are entered by the account holders (in this case the bank) and it would be amazing to see a CRA overide what is effectively their clients entry data. In other words it's not the CRA's data to change or delete.

Michael

[InformedSearcher]

Hi Michael

 

I have not got access to a scanner but this is what it says.

Thank you for your recent enquriy on share information held on your account.

I can confirm that we are currently investigating this matter with Nationwide on your behalf.

A notice of dispute has been added to the relevant entry on your file and if we are unable to resolve this dispute within 28 days. The entry in question will be suppressed from your file until a satisfactory resolution is reached.

In the mean time, if I can be of any further assitance please write to me etc.

Sorry, I should have said suppressed before, but to me if no one can see it it means the same thing. I sent all 3 the letter about notice on defaults on bank charges alone.

JP

 

Heck I don't want to sound cynical but this is a common reply. Within 28 days Nationwide will say what they want to say and it all starts again. I will reiterate that CRA's cannot alter entries themselves as their clients (who pay dearly) have full control. After 28 days I bet it'll be back unless there is proof.

My suggestion is that you get 'in writing' from Nationwide that they will remove erronous 'default' entries made. Only then will you have the upper hand and control. Now get them to apologise to you too!

Michael

[InformedSearcher]

Hi

My son received another letter from the bank stating that they have refunded all of the bank charges and they appologise for not having looked at this fairly before. The Account has been closed and the 2 debt collectors called off. There is no longer any debt and so I will wait a bit to see what the credit reference agencies now come back with as to his credit file entry.

Thanks JP

 

Blimey you are lucky so congratulations are in order! I wish HSBC would take that line with me instead of their continous robotic drone arguments. It'll be nice to see how fast they go with the entry removal. It's a shame you had to do so much both financially and mentally to make this happen - even worse that they've not refunded the extra you paid.

Michael

[InformedSearcher]

Hi

 

Got letters back now from the 2 debt collectors both saying that they have been instructed to close the account and that there is no longer any debt.

Just waiting on the amendment to his credit rating now.

JP

 

Well congratulations again - believe me, you are in the minority to have this kind of success. Make sure you 'keep an eye' on the CRA stuff but remember unless you enrol in something ongoing you only see a single 'snapshot' of the files they hold. Each call for the CRA file has a charge. One of them charge £69.99 but for that you get advised of file changes and can call a new file whenever you like - for 12 months.

Again sincere congratulations to you! 8)

Michael

Edited July 21, 2009 by InformedSearcher
Missed the 12 months bit

[InformedSearcher]

It seems that the Limitations act is to be reformed later this year (Civil Law Reform Bill) and its likely the period CRA's can hold data on your file will be a max of 3 years for all unsecured lending. See link below:-

 

Callcredit | Industry Minute

 

I would assume, as the details are somewhat vague that this would also mean financial institutions liable only for the previous 3 years of transactions? Hmm I wonder where these policy makers originate from?

Michael

[InformedSearcher]

I owed Nationwide 2,320(GBP) in Jan 2009 this went up to 2,426 (GBP) due to banking charges and fines! I paid the debt at 1 GBP per month. They refused countless times to accept, but I just carried on making the payment of 1pound month. A year later they agreed to settle at 1,080 GBP and the rest of the debt they wouldn't continue asking me to pay. So in the end I saved 1,346 GBP! Top-tip: Don't ever talk to creditors by phone (always by post & not email) +make sure your never pay to write to your creditor, get there freepost address or if they don't have one, cut out there postage mark when they write to you and stick that on your reply letter to them!!

 

 

....and I bet on both accounts they now have DN's on them? Have you checked the CRA files on this one? With your previous post did you in fact anything to them, I'm guessing you did? Apart from that congratulations.

 

Michael