Credit Solutions - Help

[Richard79]

Hi

 

I owned a franchise until March last year when work (construction industry) dried up and I could no longer afford to pay my creditors. One of these was Citroen for van lease.

 

I started to receive account in arrears letters in May from Citroen, in June they had passed this debt on to Credit Solutions. The van was returned to Citroen in September, who then wrote to advise the total shortfall was £3,691.27. They then issued a notice of legal action in OCtober, and today I have had another letter from Credit Solutions who have advised payment must be made within 7 days or else court proceedings commence. The payment has now increast to £4008.71 - it looks like they are adding fees on?

 

Just asking for a bit of advice as to best course of action. Is it to call them directly (which I have been reluctant to do, I have asked all creditors to contact in writing), just sit it out and wait for the next letter, presumably a court summons, or even submit a CCA request?? I have other creditors to consider therefore it's not just a case of working out an arrangement or paying off Citroen.

 

I was alternatively thinking of going through Payplan to sort everything out with all creditors, this is the first one to specifically threaten court proceedings

but I will be in a similar situation with the rest shortly. It's been nearly a year and I have got to the stage where I literally don't know how to start resolving my debt situation. Any help appreciated!

 

Richard

[MARTIN3030]

Welcome to the site Richard.

Was the van on lease purchase or just lease ?

You are in good hands here-because there are many who have been there,and are in fact still there,but using a structured plan.

What paperwork have you got in terms of the Citroen agreements?

[Richard79]

The van was on lease. Just to clarify because I'm not sure if I made it clear and it might help, the lease agreement was between my limited company but I was a personal guarantor hence they are chasing me personally for the debt.

I have the original hire agreement plus all correspondence from Citroen/Credit Solutions since I defaulted.

[lookinforinfo]

The critical thing with car/van leases governed by the Consumer Credit Act is how many payments you made. Once you have paid more than 50% of the repayments, you can voluntarily hand back the van without any further payment. You may still have to pay for any damage to the car or if you kept the car for an extra month without paying that months payment.

 

If you have paid less than half the repayments and hand the van back, they can then sell the van and you should then be liable for the difference between how much they got for the van plus the payments already made minus the 50% figure in your agreement.

 

You may well have to make an SAR with a £10 payment to confirm their figure of £3691.27 and also whether the increase to over the £4000 mark was lawful.

 

Whatever you do, do not phone, you need everything in writing with a possible court case pending.

 

Have you received a Default Notice and do you know if they have transferred the debt to Credit Solutions?

[palomino]

This is a business lease (or lease purchase) between Citroen and your limited company. As such it isn't a consumer contract and isn't covered by the Consumer Credit Act at all.

 

Similarly the Data Protect Act doesn't apply to a company so a DSAR is meaningless.

[lookinforinfo]

If that is the case, Richard, then I am sorry to have misdirected you.

 

I don't know enough about commercial contracts to be of help there.

But as far as resolving your situation with all your creditors you are best often to contact them yourself. Work out how much you owe, how much you are earning at the moment, take out living expenses etc and then divide whatever is left among your creditors.

 

Most companies will be relieved that you have had the courage to write to them and tell them your position and pleased by your offer to reduce their outstandings. Most will not want to go down the legal route as it is usually slow , expensive and time consuming. And they will also know that if your finances are not strong, the Court will probably not make you pay them more than you are already offering.

 

Your letters to them all may open recent wounds for you, but if you want them to accept your offer it may be as well to remind them of your recent troubles and say that you are now getting back on your feet and ready to face up to your responsibilities. Also point out that you would appreciate their cooperation since going to Court will not get their money back any quicker. And if they are one of your larger debtors, explain that you are allocating your repayments to several other companies, some with much smaller amounts owing. Each time those smaller sums are totally repaid, you then have more money available each month with which to make slight increases in the payments to those who are left.

 

Some will agree, some may not. But you will never know until you try. And if you continue to use logic and charm to the few who might not accept your offer, you may well win them over in the end. Don't take the first refusal as a definite no. Treat it as if you did not explain your situation to them clearly enough and try again. Hopefully they will all agree though if not, be prepared to write perhaps several letters to the one company using different arguments as to why they should agree.

But do not offer them more money as that may mean that you overstretch yourself and be unable to service other debtors that did accept you. In addition, once they have wrung out one increase from you, they may well continue threats of legal action to get more from you.

Edited January 18, 2010 by lookinforinfo

[Richard79]

Thank you for the advice so far. I have attached the last 3 communications I have received, 2 from Citroen and the one from Credit Solutions.

I am currently claiming JSA and haven't set up a payment plan yet with anyone, I did advise Citreon of this when I spoke to them on the phone. I also have an outstanding debt with Siemens (similar situation, as a guarantor) and am in the process of setting up an I&E form with a view to setting up some token payments.

Even thought it isn't a CCA is it worth doing a SAR as we have had no details as to why the payment has increased? Or should I try straightaway to negotiate a payment? Credit Solutions have advised not to write however am uncomfortable arranging this on the phone with them, would you advise to write anyway?

[Richard79]

Apologies, realised images were tiny, have tried again.

Credit Solutions.doc

[lookinforinfo]

Yes, always deal in writing especially with companies like Credit Solutions.

Never ever talk to them on the phone as they will try and scare you into agreeing things and some companies take advantage by lying over the phone.

 

And yes, do SAR them, but bear in mind that they can take 40 days within which to respond and they may well have initiated legal proceedings by then.

By the way, send the SAR to Citroen and also any payments too. Cut CS out of the loop if you possibly can.

 

I cannot enlarge the letters that you have uploaded and not have them too blurred to read. Could you please try again perhaps using imageshack?

[Richard79]

Letters uploaded again, hopefully work this time.