My Debts & Various DCA's & Letters

[willtheywontthey]

I thought there was some guidance or regs which stated they cannot ask you to borrow more or use credit cards?

 

The DCAs letter has a logo of visa etc cards and then states below pay using debit or credit card.

 

Any further clarification or assistance on this as I am hoping to formulate a letter on this alone to them and to OFT if my assumptions are right?

[andydd]

I thought there was some guidance or regs which stated they cannot ask you to borrow more or use credit cards?

 

The DCAs letter has a logo of visa etc cards and then states below pay using debit or credit card.

 

Any further clarification or assistance on this as I am hoping to formulate a letter on this alone to them and to OFT if my assumptions are right?

 

I have a secured loan and when I had payment difficulties I phoned up and was asked if I could use a credit card, I was a bit gobsmacked by this and told him firmly 'no'. I thought there was OFT guidance against this but unsure where so Id be interested in any answers.

[cerberusalert]

Page 9 (2.6b) Debt collection guidance - Final guidance on unfair business practices - oft664

 

Physical/psychological harassment

 

b.

pressurising debtors to sell property, to raise funds by further

borrowing or to extend their borrowing

[Debtcontrol]

I have a secured loan and when I had payment difficulties I phoned up and was asked if I could use a credit card, I was a bit gobsmacked by this and told him firmly 'no'. I thought there was OFT guidance against this but unsure where so Id be interested in any answers.

 

I have had the same, it just shows what a shower of crooks every one of them is.

[willtheywontthey]

thank you one and all.. that's the one I was looking for.

 

Now I could do following if I am right:

 

1. wait 18 months for FOS to do nothing really

2. Contact OFT to log my 'concerns' (they do not deal with complaints between parties.. )

 

or nothing else I guess?

 

Have now emailed OFT with a complaint referring to cerburaselert's reference.

 

Thanks

 

x

Edited June 23, 2009 by willtheywontthey

[diddydicky]

NEVER give a creditor or dca your credit or debit card details

 

send any/all payments by cheque of by standing order and NEVER direct debit

 

better still dont send them anything at all!

[kurvaface]

The phone number for trading standards is

 

08454 040506

 

Give them a ring and complain. The more complaints about these thugs the better.

[willtheywontthey]

I use OFT not trading standards as we are rural so they all know somebody you know ie gossip. Same with post offices - I keep having to sue different ones for my special deliveries as I am paranoid that the new systems they have state name of company X as being X Ltd debt collectors. Added to that I am sure my postman knows more about my finances than I do because of these postcards!!

 

If I use Consumer Direct they then contact TS to contact me which i do not want as they are local! (and useless)

[kurvaface]

Or you can use the ts in the area of the dca..... I found ts very helpful.

 

But wiitheywontthey is right... Contact OFT.

[NitrousOxide]

OFT definately, it's further borrowing.

[diddydicky]

OFT definately, it's further borrowing.

 

not sure that asking you to pay by credit or debit card is classed as encouraging you to further borrowing

 

inviting or encouraging you to take out a new loan to pay off an existing once is really what is meant by encouraging further borrowing

 

IMO

[diddydicky]

if you used a credit card to make a payment it would be covered under an existing limit (agreement) else it would bounce

 

a debit card is no different to cash or a cheque and is a payment from your bank account and again would not be classed as "further borrowing"

[NitrousOxide]

if you used a credit card to make a payment it would be covered under an existing limit (agreement) else it would bounce

 

a debit card is no different to cash or a cheque and is a payment from your bank account and again would not be classed as "further borrowing"

Debit card no but credit card is a yes.

[diddydicky]

Debit card no but credit card is a yes.

 

sorry i must have mis read the post

 

as i understood it the creditor was showing the debtor the methods of payment that they accept

 

if this is the case (as i assumed) offering someone the opportunity to make a payment by credit card and debit card is NOT offering or encouraging them to take on further credit

 

if however the poster is saying the the creditor was suggesting they take out a new credit card with the purpose of paying off the entire debt then that would be different- but i dont think that that was what the poster was saying!

[ODC]

If they ask you to use a credit car to pay them you are in fact borrowing money against a pre defined credit limit. You dont actually have the money but borrow it from a Credit Card company whith which to pay a DCA. IMHO this is borrowing money and is a breach of the OFT Guidelines.

 

Paying by Debit Card is an entirely different matter although I would never give a DCA my Debit card details.

[diddydicky]

If they ask you to use a credit car to pay them you are in fact borrowing money against a pre defined credit limit. You dont actually have the money but borrow it from a Credit Card company whith which to pay a DCA. IMHO this is borrowing money and is a breach of the OFT Guidelines.

 

Paying by Debit Card is an entirely different matter although I would never give a DCA my Debit card details.

 

most people using a credit card already have a limit set on the card

 

the OFT specifically refers to encouraging debtors to enter into FURTHER borrowing and there is no evidence presented which suggested that the creditor said " why dont you go out and increase your credit card limit or get another one to make a payment"

 

don't get me wrong i am 100% cagger but i do feel sometimes it earns us no brownie points with the OFT when we try to make complaints (if my reading of the post was correct and there is no other information the poster forgot to mention) over matters which quite frankly are just nonsense- the creditor was IMO merely offering the different ways to pay!

[ODC]

I take your point. Consider this

 

You have a credit limit of £1000 on your card. The card is clear. You use the card to pay off a DCA £500. You then owe the card company £ 500 which you must pay back. Therefore you have borrowed money to pay a bill. QED

 

It used to be known as Robbing Peter to pay Paul.

[NitrousOxide]

Hi,

I was in discussion with the OFT about this very issue about 3 years ago but they never gave their final answer as they were quite busy. I may write to them again to get a response.

If you had a debt of say £500 and paid it on a credit card, it will be significantly higher than £500. This is because you pay interest on the credit card which is also usually much higher than if the original debt was a loan. If the original debt had no interest (i.e. was a utility bill) you will now pay interest if paying by credit card.

Also if you only ever pay the minimum amount on your card it compounds the amount you pay and can be quite shocking.

I don't have the email anymore but the OFT said basically because a card is issued under the consumer credit act it is considered borrowing.

Actually I will write again, this has spurred me on to do it.

 

EDIT:Remember a card is not fixed term credit either.

Edited June 24, 2009 by NitrousOxide
Extra line

[diddydicky]

I take your point. Consider this

 

You have a credit limit of £1000 on your card. The card is clear. You use the card to pay off a DCA £500. You then owe the card company £ 500 which you must pay back. Therefore you have borrowed money to pay a bill. QED

 

It used to be known as Robbing Peter to pay Paul.

 

yep i understand that (thats what we have all been doing i suspect) but the oft clearlly refers to

 

FURTHER borrowing

 

and i am sure was originally intended to prevent lenders associated with the OC moving debts on to even more loans and consolidation loans

[ODC]

If you owe nothing on your Credit Card and you use £ 500 of your credit limit that is FURTHER borrowing. At least it was when I went to school.

 

Before you borrowed the money from your credit card you didnt owe anything on your credit card. By using the £ 500 you have in fact borrowed more money. You now owe it to a Credit Card company instead of the DCA. Its no different from going to a friend/parent/lover and asking for the loan of £ 500 to pay off a DCA who is sending threatomatics to you.

[willtheywontthey]

Interesting comments. Would be interesting if anybody gets responses on this from OFT - in my opinion they tend not to reply with any guidance.

 

I also recall many banks refusing to accept credit card as payments suddenly some years ago?

[diddydicky]

and if you paid it back out of your bank account (becuase you used the card for convenience) before the interest is charged then that is called managing your money!

 

i have learned on this forum that there is a time , having made your point to shut up otherwise a discussion turns into an argument

 

that time has come for me on this thread

[NitrousOxide]

If you owe nothing on your Credit Card and you use £ 500 of your credit limit that is FURTHER borrowing. At least it was when I went to school.

 

Before you borrowed the money from your credit card you didnt owe anything on your credit card. By using the £ 500 you have in fact borrowed more money. You now owe it to a Credit Card company instead of the DCA. Its no different from going to a friend/parent/lover and asking for the loan of £ 500 to pay off a DCA who is sending threatomatics to you.

Plus interest on top.

 

and if you paid it back out of your bank account (becuase you used the card for convenience) before the interest is charged then that is called managing your money!

 

i have learned on this forum that there is a time , having made your point to shut up otherwise a discussion turns into an argument

 

that time has come for me on this thread

It's apples and pears really.

You are correct when reffering to debit cards as it's usually your money from your own bank account (not including overdrafts).

However it is generally accepted that using a credit card is further borrowing.

[ODC]

i have learned on this forum that there is a time , having made your point to shut up otherwise a discussion turns into an argument

 

that time has come for me on this thread

 

You are a sensitive soul. I have no desire to get into an argument with you. You have given your view. I have given mine with my reasons. I happen to think I am right and you obviously think you are correct. Who knows.

 

It seems strange though that some DCAs have actually removed Credit Cards from their lists of acceptable payments yet have left debit cards and prepaid credit cards

[diddydicky]

You are a sensitive soul. I have no desire to get into an argument with you. You have given your view. I have given mine with my reasons. I happen to think I am right and you obviously think you are correct. Who knows.

 

It seems strange though that some DCAs have actually removed Credit Cards from their lists of acceptable payments yet have left debit cards and prepaid credit cards

 

no not at all sensitive - just that i want friends on here ( i might need you someday) i had a belly full of rancour with the mr ton thingy and would prefer not to get bogged down in that sort of thread again

 

no offence