HSBC Managed Loan Issues

[SpartanKing]

Hi Everyone. I have reposted this issue as a new thread on the advice of JonnyMitch. Below is the original post I had and the initial information Jonny gave me. For the record I have already requested CCA for the managed loan and received a copy of the agreement that as far as I can see seems to be in order. So if anyone else can help whith any further advice it would be greatly appreciated.

 

Originally Posted by SpartanKing

Hey Jonny,

 

Hi SpartanKing , welcome to the forum

 

You seem to be pretty clued up on some of this stuff and was wondering if you can help me.

 

I have just joined this forum as I am keen to see if any of my credit agreements are unenforceable.

 

I presently have an issue with a couple of things to do with HSBC and was wondering if you could asist and give me some useful advice on this one.

 

Firstly I had a £25,000 unsecured loan with HSBC in 2004 which I paid for 2 years before it was restructured into a manged loan as I could not afford the repayments of over £600 a month. My question is, can I still contest this original personal loan, and if it is unenforceable, what I am entitled to?

 

I must admit I'm not sure about this one, SK , you could ask them via a CCA for a copy of the original agreement , but if it was restructured into another loan , they may say they haven't got it, although they should have if it finished less than 6 years ago (2006?)

 

Secondly, I now wish to contest the managed loan and have received the CCA which appears to be in order, however:

 

1: Having read all about what constitutes an enforceable agreement I think they have covered everything, however they have never notified me of any changes on the interest, or how this would affect my monthly payments which it says they will in the agreement. Is this grounds for anything? Or is there anything I can address which I may have missed?

 

A Managed Loan is supposed to be a temporary measure to tide you over a rough , financial period - it's not suppposed to be long-term and should be reviewed periodically to see if if can be re-strutured to your advantage - not theirs....... if no reviews have been done you may have a case to report this to the FOS - it may constitute a breach of the Managed Loan agreement , which you should also ask for as part of your CCA Request .

 

2. Most importantly. If the original personal loan can be contested and found to be unenforceable, then does that mean by default that the managed loan also becomes null and void as a result of being established to cover the original personal loan that was unenforceable?

 

I think it's best to take the CCA route first to find out exactly what they've got on you - see if they can produce viable agreements - then you can work out your next moves from that point ....

 

Some quality knowledge and advice on this matter would be greatly appreciated.

 

Regards,

 

Spartan

I'm no expert SK, but I've picked up a few bits and pieces along the way - no doubt if I'm wrong though ,someone will jump in and say so ......

By all means come back and ask if you're still in doubt - someone will answer , and we're user-friendly .... :grin:

[johnnymitch]

Hi SK , thanks for setting up your own thread

 

For the record I have already requested CCA for the managed loan and received a copy of the agreement that as far as I can see seems to be in order.

 

Does the agreement say anything about periodic reviews of the Managed Loan ?

 

Or were you made aware when you were forced into a ML from a previously unsecured loan that it was a temporary measure until you got back on your financial feet ?

[SpartanKing]

Hi JM.

 

As far as I can see the agreement does not mention anything about the Managed Loan being a temporary facility, nor was anything ever explained to me that any reviews would take place, or that it was a facility to assist me in getting back on my financial feet.

 

However the agreement does state that:

 

The repayment details below assume no changes in the interest rate. If it changes, we will notify you of the revised repayment details in accordance with clause 10 of the loan terms.

 

Clause 10: We may change the amount and/or the number of your repaymets and the period of the loan to take account any changes of our base rate after the date of this agreement or if you do not make your repayments on time. We will give you 7 days notice in writing of any such changes.

 

Now given that the Bank of England base rate has tumbled over the last 8 months, and that my agreement is variable at 7.00% above base rate, I would have imagined that there would have been some serious reductions I should have been entitled to, just like I have had with my mortgage? Yet I have never received a single piece of paper or a phone call regarding anything to do with my ML until I was unable to continue making the repayments of the ML, I have since received a phone call every single day...lol.

[johnnymitch]

Clause 10: We may change the amount and/or the number of your repaymets and the period of the loan to take account any changes of our base rate after the date of this agreement or if you do not make your repayments on time. We will give you 7 days notice in writing of any such changes.

 

The operative words here SK are 'our base rate' - that's not the B of E base rate they're referring to - it's their own , which quite conceivably hasn't changed , even though the B of E rate has gone through the floor ... because they're greedy beggars !

 

When your Loan was re-structured to Managed Loan - did you sign a new agreement , or did they just railroad you onto it from the old one ?

 

As for phone calls , tell them once that you don't want to communicate by phone only in writing and if they ignore that , come back and we'll sort out a letter for them ....... and of course if you don't answer their security questions , they can't talk to you anyway ......

[SpartanKing]

I did sign a new agreement, of which I have a copy after a CCA request. As for the base rate thing I was sure that banks base rate was normally about a point above B of E rate, and alot of pressure was put on those who werent pasing this on to their customers, of which HSBC were?

[johnnymitch]

That's what they were supposed to do SK , but did they ? If they did you should have been notified ..... may be an idea to get someone to ring up and ask what their current rate is - unless 'yourbank' can help us with this one ?

Edited July 3, 2009 by johnnymitch

[SpartanKing]

I have requested CCA for the original personal loan now as well as requesting information as to what the HSBC base rate has been over the last 2 years and the dates that any changes took affect.

 

I shall inform you of their response and we can take it from there. Thank you for your assistance so far.

 

SK

[SpartanKing]

Right, I have a copy of the original CCA for the personal loan that got all of this started. I was thinking that it may be best to scan and email these to you JM so you can take a look at them and give me your opinion on them.

 

If you agree then please send me your email address and I will send the scanned documents to you for your thoughts.

 

SK

[johnnymitch]

Can you post them up on here please , spartanking , using photobucket or equivalent ....... that way more people on site can see and give advice on them .

 

Thanks

johnny

[SpartanKing]

Ok will do.

[SpartanKing]

Hi JM,

 

I have received all the documents from HSBC now, including a copy of all of the base rates and changes that have taken place. I have scanned them as PDF files and attached them for yours, and anyone elses perusal.

 

I do not know whether my thoughts are correct here, but it is eveident that the base rate has changed several times, yet HSBC have never once in 2 years notified me of it, or how this affects the alleged agreeement/payments etc, contrary to what they say in their agreement in clause 10.

 

I would be interested to hear your thoughts on this, plus anything elase you may wish to add after looking at the documents. I have atached the original personal loan of 2004, the managed loan of 2006/7 which has 3 parts and the base rates.

 

Regards, SK.

personal loan cca.pdf

managed loan.pdf

ML Key Info.pdf

HSBC Base Rates.pdf

Edited August 12, 2009 by SpartanKing

[SpartanKing]

Hey Johnny, or anyone else. Can you help me with any of the above please. All the agreements are now attached and please see previous posts for requested help and advice please.

 

Anyones useful help would be greatly appreciated.

 

Regards,

 

SK

[johnnymitch]

Hi SK , I've asked if a member of the Site Team can have a look ----- this should get the help you need .....

[42man]

I notice you had PPI on at least one loan....what is the status of this at the moment ? have you defaulted at all ? I'm not 100% on this but the agreement would seem to be ok.....(i'm not an expert on this)....

[SpartanKing]

42 Man,

 

From what I can gather the PPI was refunded when the original personal loan was consolidated in the Managed Loan.

 

I was just hoping that a breach would be evident on the managed loan as a result of never having been informed of any changes in rates or interest as a result of changes in the base rate?

 

I look forward to your reply.

 

Regards,

 

SK

[citizenB]

One of the site team has left this comment for you. HTH

 

The personal loan agreement is not properly executed as the APR is wrong for the main loan - it is actually 9.2% not 8.9% and this is outside the tolerance allowed by schedule 7 of the Consumer Credit (Agreements) Regulations 1983. It can therefore only be enforced by court order under s65 CCA 1974.

 

Unusually, this lender has actually got the agreement right in terms of s18 - multiple agreements although I think it should probably have seperate signatures for the main loan and PPI as the two bits are treated as seperate agreements. THis could make it unenforceable under s127.

 

The managed loan is not properly executed because the TCC is wrong (how can a multyiple of £400 be anything with 79p on the end) The APR is correct (12.7%) based on 86 payments of £400 giving a TCC of £11438 but there is a sum of £58.79 missing somewhere. Again, it can therefore only be enforced by court order. Depending on where the missing amount is, it could render the agreement unenforceable under s127.

[SpartanKing]

Citizen B,

 

You are an absolute star. As a result of your findings here. Am I entitled to be able to ask for anything back with regard to what I have paid with the Original personal Loan? And will I be able to request back any money paid on the Managed Loan if they do not contest my dispute?

 

More importantly, if the original personal loan was is potentially unenforceable, then does it mean that the follow up Managed Loan to consolidate it is null and void?

 

If you have any kind of template letter, or excerpts that I should include in a letter that I will send to them I would be very grateful.

 

Your pearls of wisdom are greatly appreciated.

 

Regards,

 

SK

Edited August 13, 2009 by SpartanKing

[citizenB]

SK, the above information was provided by steven4064, I will see if he is able to offer any further advice for you.

[steven4064]

SK

 

I am not sure whether the personal loan agreement was unenforceable or not and I think you would have had a hard time pursuading a court not to enforce it.

 

However, you are saying that the personal loan was paid off by the managed loan, therefore the agreement is no more. The managed laon is now what is in force.

 

However, the presence of PPI in the original loan further complicates the issue IMHO as that ought to have been listed seperately in the managed loan - the original loan agreement was a multiple agreement and this one ought to be one too as you are still paying the insurance premium with it. That means the prescribed terms are even more wrong than I thought. My feeling is that this loan is therefore unenforceable by a court.

 

This fact is only helpful to you on certain circumstances:

 

1. they take you to court for it

 

2. you take them to court under s142 of the CCA 1974

 

3. you could use the fact that the agreement is unenforceable to make them a full and final offer to settle of something between 5p and 15p in the pound.

[SpartanKing]

Steven,

 

Thanks for your input on this matter, however I do not fully understand all the information you have given me here.

 

Firstly, I understand that the original personal loan is no longer. As for the Managed Loan, naturally this is still ongoing, but I do not have any insurance with htis. The PPI was only with the personal loan and ended when it was consolidated with the ML.

 

Does this alter things in any way? Personally I am just looking for a way to get rid of this agreement as since I had the original personal loan I have paid back approx £20k yet I am still owing £19k!

 

Your help is greatly appreciated.

 

Regards,

 

SK

[InformedSearcher]

Just thought I'd add my bit here. I am NOT an expert but have now endured the bitter hard edged swords of HSBC. I'm not bad on the phone though! Hey they hardly ever call me now.

 

In my case I have not been offered a managed loan - thank god - as I have no disposable income to play with. I think people have to consider carefully about entering into further commitments with the bak (or whoever) because it might seem good at the begining but can be drastic if things go wrong and you (often due to no fault of your own) miss payments or don't adhere exactly to the letter of the agreement. Before signing anything, read it carefully and ask questions. They hate being asked questions you know!

I always ask if it's an incentive to subject yourself to misery probably for years to come if you see your CRA data is abymisal. Banks will say 'it's the law' a bit too often to have you adhere to their requirements. I've even been told by an HSBC (India call centre) 'service man' that the bank must adhere to the law of the FSA and then I 'tore him to bits verbally'. His 3 years employment (yes he told me that after I worried him) must have flashed through his mind after that ridiculous comment he made and my subsequent responce.

I appreciate there are people here who are so helpful, clever and as wise as the banks and for me when I think it's all over another blip appears. Make sure you open a parachute account because they will think nothing of closing your current account if you falter - They will tell you though - once you call them to ask what happened. I've endured the ATM card vanishing more than once and when I call 'We've arranged for a replacement to be sent to you' has swiftly followed.

In fact my offer of suggestion is that if things go wrong distance yourself as mentioned above. You should be in control of your money and not these computer controlled and programmed people.

Michael

[citizenB]

Spartanking, Have you all the paperwork from the original loan (pre managed loan). If not, it might be a good idea to send a Subject Access Request.

 

If the loan was repaid early by the managed loan then there should have been a rebate or the whole of the premiums with interest repaid if the policy was mis sold.

[steven4064]

... but I do not have any insurance with htis. The PPI was only with the personal loan and ended when it was consolidated with the ML.

I think you will find you do - it may not be shown on the agreement but I bet the amount of the ML includes the unpaid part of the PPI premium from the first loan - check the numbers.

 

Ask HSBC (or the insureer) if the policy is still in effect. If not, ask why not as you are still paying for it.

[SpartanKing]

Ok, Ive emailed HSBC to find out what the score is.

[SpartanKing]

Just out of interest. I have just got the debt collection company of Next Directory to cease all action. They say they have returned the account to Next, but I have not heard anything back from them in weeks.