Nationwide have defaulted me but I had started hardship claim

[Andrea1967]

I am really distressed to have come home tonight to find a default notice from Nationwide for £748.59. This is £248.59 over my agreed overdraft and almost completely made up of charges.

 

I had got into the bank charges spiral earlier this and (conscious of a similar experience detailed on here some 4 years ago) did my best to minimise this. I cancelled direct debits and did my best to rearrange my finances to counter the effect of the charges and unpaid bills. Whatever I did just did not seem to be enough. Even selling off some possessions on ebay backfired when paypal claimed the charges without warning and took me into the red again. So a couple of quid fee cost me the requisite £30 etc etc...

 

I looked into claiming back charges through hardship but did not get my details to them in time and they turned down the claim. I then diverted my salary to another account to enable me to try and alleviate some of my creditors but this has proved hard going. I applied for extra borrowing on my mortgage but was declined due to credit file. The credit union won't help me as I was paying them by debit card and no longer by direct debit. My other bankers will not increase my overdraft. All lines of credit are closing off to me and a default is the last thing I need.

 

Further charges were applied to my account and a letter came advising me that I was outside my agreed limit and I should resolve this immediately. I responded by asking them to commence a new charges claim under the hardship criteria and provided a full statement of means. This was on the 10th June. I was expecting a response by now and believe their guidelines say they seek to deal with such claims within 2 weeks.

 

I am a single mum of two children, my ex husband as an overseas national gets away with providing no financial support. I work full time and with the demands of my children/job am struggling to stay on top of my evermore desparate situation.

 

I believe Nationwide should have considered my hardship claim by now and their response would have a bearing on my position with them. Am I right in thinking, from what I have read here, they should not have defaulted me?

 

I am living from payday to payday, robbing Peter to pay Paul. If this is not hardship I literally don't know what is. I intend to contact Nationwide tomorrow to request they remove the default in the light of my hardship claim and hope there is a chance I can receive some urgent guidance that I desparately need before then.

 

Thanks

[Andrea1967]

Letter ref:

Our ref:

30th June 2010

 

Despite letters I have already sent to you, your account is still overdrawn without our agreement.

 

I enclose a Default Notice that you should read carefully.

 

Please pay the amount you owe by the date stated in the notice. To make a payment by card, please call us on the number shown above.

 

If you don't pay, the following could happen:

 

- We may not allow you to pay for goods and services using your debit card

- We could return standing orders and direct debits unpaid. This could mean you have to pay further charges.

- We might withdraw your overdraft.

- If you try to use your card, it may not be returned to you.

- Our representative may visit you to collect your cheque book or card (or both).

- We could take legal action and seek to obtain a court judgement against you.

 

To make sure any action we take is appropriate we may do a credit search to assess your financial position. Any credit search will be recorded on the files of one or more credit reference agencies. Many credit searches on your file credit record may make it difficult for you to get credit elsewhere.

 

If you can't pay the amount you owe, please contact us to talk through your options.

 

Yours sincerely

Karen Bartley

Senior Manager

Flexaccount Collections

 

We may add the following charges to your Flexaccount if you stay overdrawn without our agreement.

 

Unpaid overdraft monthly fee £20

Unautharised overdraft interest rate 18.9% EAR*

Unpaid items (due to not having enough money in your account) £30 for each item

Making a guaranteed payment with a card, without having enough money in your account to cover it £21.50 for each item.

 

*EAR - Equivalent Annual Rate. The yearly cost of an overdraft.

Encs: (1) Default Notice (2) Office of Fair Trading 966 Default Information Sheet.

 

Nationwide Building Society is authorised and regulated by the Financial Services Authority under registration number 106078.

Credit facilities other than regulated mortgages are not regulated by the FSA.

[Andrea1967]

IMPORTANT - YOU SHOULD READ THIS CAREFULLY

DEFAULT NOTICE

Date: 30th June 2010

 

To: My name

my address

 

From: Lending Control, Nationwide Building Society, Kings Park Road, Moulton Park, Northampton, NN3 6NW

 

We hereby give notice of default in respect of Nationwide's agreement with you, details of which are shown below.

 

Type of Agreement: Flexaccount

Account number: xxxxxxxxxxx

 

Provision Breached: Under the above agreement you agreed to return the account to credit following a demand for payment.

Nature of Breach: The account remains overdrawn despite demand for payment being made.

 

Action required by you: Payment fo the overdrawn balance which at the date of this notice stands at £748.59.

Date by which action is required: Payment of the overdrawn balance must be received by us on or before 21st July 2010.

 

IF THE ACTION REQUIRED BY THIS NOTICE IS TAKEN BEFORE THE DATE SHOWN NO FURTHER ENFORCEMENT ACTION WILL BE TAKEN IN RESPECT OF THIS BREACH.

 

IF YOU DO NOT TAKE THE ACTION REQUIRED BY THIS NOTICE BEFORE THE DATE SHOWN THEN THE FURTHER ACTION SET OUT BELOW MAY BE TAKEN AGAINST YOU.

 

Further Action: If you fail to take the action required by the notice within the time provided then we will terminate the agreement. We will require you to return all unused cheques, guarantee cards and flex-account cards. We may also commence legal proceedings to recover the overdrawn balance.

 

You should be aware that if we take you to court and get a judgement against you requiring you to pay the money you owe us under the agreement, you may have to pay us both the amount of the judgment until you have paid these in full. This means that even if you pay off the whole amount of the judgment, you may still have a further sum to pay.

 

IF YOU HAVE DIFFICULTY IN PAYING ANY SUM OWING UNDER THE AGREEMENT OR TAKING ANY OTHER ACTION REQUIRED BY THIS NOTICE YOU CAN APPLY TO THE COURT WHICH MAY MAKE AN ORDER ALLOWING YOU OR ANY SURETY MORE TIME.

 

IF YOU ARE NOT SURE WHAT TO DO, YOU SHOULD GET HELP AS SOON AS POSSIBLE. FOR EXAMPLE, YOU SHOULD CONTACT A SOLICITOR, YOUR LOCAL TRADING STANDARDS DEPARTMENT OR YOUR NEAREST CITIZEN'S ADVICE BUREAU.

 

This notice should include a copy of the current Office of Fair Trading information sheet on default. This contains important information about your rights and where to go for support and advice. If it is not included, you should contact us to get one.

[Jamesx81x]

Hi Again Andrea

 

Karen Bartley name rings a bell thats who i was dealing with when i was going through my complaint.

 

Firstly you received the default an on the 1st July. The ICO Guidance on filing defaults clearly states that the consumer must be given 28 days to remedy the default (section 33).

 

http://www.ico.gov.uk/upload/documents/library/data_protection/detailed_specialist_guides/default_tgn_version_v3%20%20doc.pdf

 

The Lending Code 2009 Section 3.36 also clearly states that 28 days must be given to remedy.

 

http://www.lendingstandardsboard.org.uk/docs/lendingcode.pdf

 

Even the date on the default notice does not give you 28 days

 

For that reason this default notice is not valid and should they place it on your file it will be inbreach of the 4th principle of the data protection act which recording accurate and fair data comes under.

 

Does the default notice also have served under the consumer credit act on it? If so that is a load of tosh to as an unauthorised overdraft doesnt come under the cca.

 

Make a complaint to them using the grounds above. They may infact choose to issue more accurate one at a later date but it will give you a few weeks to try putting things right.

[Andrea1967]

Hi James

 

You're a star for looking at that. I will proceed on those lines. And oh yes, I omitted to type it in, the DN is

 

Served under Section 87(1) of the Consumer Credit Act 1974

 

So I point that out too?

 

Why would they not straighten these issues out if people are sucessfully challenging them?

 

Lucky for me they haven't though I suppose.

 

Cheers

Andrea

Edited July 3, 2010 by Andrea1967
typo

[Jamesx81x]

Because they are stupid and incompetent to be honest.

 

Simply ask them what credit agreement they are referring to. Bet they will not be able to answer you.

 

The 28 days is clearly set out for them to understand and abide by. If they dont that is their problem not yours.

[Andrea1967]

I could have this wrong James but from looking around, I think the 'account in dispute' argument against defaults does apply for a credit agreement. I might not enlighten them at the moment.

 

I will draft a letter to send Monday pointing out:

 

it's invalid (28 day rule)

not to place it on my file re breach of 4th principle of data protection

account in dispute and they should give me up to date position of hardship claim then we can seek to resolve the matter.

 

Does that sound fair enough?

 

I also fancy sending all the corres. to the CEO (a Mr Graham Beale) and Co Secretary as well as our friend, recorded delivery to each.

 

When I initially googled 'getting defaults removed' that was some advice I stumbled on.

[Jamesx81x]

An account in disupte is simply you disputing inaccurate amounts that you owe for example. You can dispute any account you have whether it be catalogue or bank but you need a valid reason for doing so.

 

Since the supreme court decision, the fact they have added bank charges you do not agree with cannot really be used any more. You can go along the grounds of hardship but even then the bank is not obliged to return any previous charges if they do not wish to. They may offer services in other ways ie, freezing interest no future charges things like that.

 

With regards to the CCA the point i am making is that they have issued the default under section 87 of the cca. This can only be done on a credit account that is governed by the cca. An unauthorised overdrfat is not. They have not given you credit, neither have you signed a regulated agreement. Section 87 clearly states regulated agreement.

 

It is something you need to fire at them straight away along with the fact they have breached Section 33 of the ICO's guidance on defaults and section 3.36 of the lending code.

 

They will have only breached the data protection act if they place the default on your credit file as at the moment they are threatening you with one.

 

I will write up a letter for you and send you it, probs tomoz then you can post it Monday.

 

[Andrea1967]

bless you James. I understand the issue around charges given the current situation but I guess I was thinking that my applying for a refund of charges under hardship criteria was a dispute.

 

I really appreciate the kind attention you're putting my way.

[Jamesx81x]

No you just have to be experiencing financial hardship

[Jamesx81x]

Hi Andrea

 

Send them this, just add all your details account/referenc number etc.

 

Account No. xxxxxxxx

 

Dear Karen Bartley

 

Firstly reference the default notice itself it states it is served under Section 87(1) of the Consumer Credit Act 1974. Section 87 refers to breaches of a regulated agreement. As an overdraft is not covered by a regulated credit agreement the default notice is not valid.

 

I would also like to bring to your attention Section 3 Paragraph 36

 

Whether or not notice was given by the subscriber and consent was obtained from the customer at the time the account was opened, disclosure of default information can be made. But, in all cases, the customer must be given further notice of the intention to disclose the information at least 28 days before the disclosure is made (for example, when a default notice or formal demand is given). At the same time, customers must be given an explanation about how default information registered against them may affect their ability to obtain credit in the future. This notice will mean that customers have 28 days to try to repay or come to some arrangement with the subscriber before default information is passed to the CRA

 

Section 33 of the ICO guidance on defaults also reiterates this, clearly stating a minimum of 28 days is to be given.

 

As 28 days have not been given in this case you are in breach of both the ICO guidance and Lending Code 2009.

 

Furthermore if you do add this data to my credit file after clearly not following the correct guidelines laid down you will have breached the fourth principle of the Data protection Act in that the data will not have been processed fairly.

 

I trust this clarifies my position on this matter and i look forward to receiving a full explanation from you.

 

Regards

 

XXXXXX

 

Hope you get a positive reply.

 

James

[Andrea1967]

Hi James

 

Thank you so much for doing this - you are an absolute hero. I was just logging on to message you when I saw it as I was going through the correspondence from them. I really hope I haven't wasted your time here with what I have found. Before they defaulted me with the letter dated 30th June - they wrote me a letter dated 3rd June which said (amongst other things)

 

'if you don't pay or contact us within 7 days we will record your failure to pay as a 'default' on your credit file with one or more credit-reference agencies. As the information is shared with other organisations, it could make it difficult for you to get credit in the future'.

 

I did contact them though when I wrote to them in response on 8th June asking them to revisit the hardship claim and sent them all the details.

 

Does this impact on what's contained in your letter? Although 3rd June to 30th June (DN Date) is only 27 days without time for posting and the letter of 3rd only gave me 7 days.

Edited July 8, 2010 by Andrea1967
adding some more info.

[Jamesx81x]

Has to be 28 days from the day you receive it.

[Andrea1967]

Phew. Thank you James.

[Andrea1967]

Letter sent to Nationwide today (by email to Graham Beale)

27 August 2010

Nationwide Building Society

Dear Sir/Madam

Flex account: xxxxxx

 

I am writing to express my concerns about the way my account has been handled. I should point out that I have previously been advised only to deal with you in writing. It was only when the situation was becoming increasingly urgent that I decided to telephone. It is my view that going against this advice has not served me well.

You will recall that I entered into difficulty following a spate of bank charges being applied to my account earlier this year. This quickly escalated until I was faced with severe financial difficulties and a rapidly, deteriorating credit rating due to the subsequent late or missed payments incurred due to lack of funds. (There’s a reason this situation is referred to as a ‘bank charges spiral!’).

I tried all means of raising extra money to combat the situation but the amount owed increased by hundreds of pounds. Due to the nature of these charges and how they are applied is such that it is extremely difficult to predict their incidence and amounts in advance.

Having no obvious route of acquiring the funds you required in time, I requested a review of my bank charges under financial hardship criteria, which you swiftly declined.

Further charges were applied so on 8th June, I made a further request for these to be reviewed under hardship criteria. I provided full and detailed financial information as well as details of my personal circumstances as a single parent, working full time on a fixed income with no other means of raising money and all reasonable lines of credit closed off due to the impact on my credit file (as detailed in my previous correspondence).

A default notice was then applied to my account.

I took advice and was told that the default notice was firstly issued incorrectly in that the notice does not provide 28 clear days to rectify the situation and is issued under the Consumer Credit Act which does not apply to overdrafts. As I had asked for the charges to be reviewed, the account was effectively in dispute and therefore the default notice should not have been applied.

I wrote to you to request it be removed and issued in the correct manner which you refused. (In the meantime, your review of my bank charges request took over six weeks for you to investigate which goes some way beyond your own policy of handling these within four weeks.)

Whilst still awaiting the outcome of the review of charges and receiving further correspondence dated 13th July stating that I needed to settle immediately with the full amount of £748.59, I approached a doorstep lending firm to borrow as much as I could (£300).

On the 15th July (I called and spoke to A in Flexaccount Collections. She told me that the amount due immediately was £277.37 (which would include forthcoming interest charges for the next month of £28.78) to bring my account back within the agreed overdraft and if I paid the amount outstanding by 21st July my account would be restored to normal. During that call I made a payment of £200 (payment ref: xxxxxx)

On the 20th July I called and paid a further £80 being slightly over the balance due and believed that to be the end of the matter and all I needed to do now was set about paying off my overdraft at a reasonable rate.

I received a letter from you saying that you rejected my claim for a refund of bank charges under hardship criteria. I found this surprising given that I meet a number of the criteria as laid out by the Financial Ombudsman.

I then received a statement from you ) dated 24th July showing my payment of £80. There was no record of my £200 payment made on 15th July.

I called your office to query this and spoke to B, who told me my account had been closed and all ‘charges’ amounting to £697.37 had been refunded. I said I knew nothing about this and explained the payments I had made and the conversation I had had with A on the 15th.

The young lady I spoke to admitted my account had been closed in error, she noted my payment of£80 and advised that a settlement agreement had been reached. I expressed deep concerns about a settlement being agreed at this amount and without reference to me and about how this would be reflected on my credit file as I had taken all steps you required to bring my account back into line. I pointed out my payment of £200 on the 15th July which she found on her system. She kept me on hold for some time to discuss this with her manager. She came back and advised that my credit file would reflect the matter as satisfied at zero. (However, I feel obliged to check this and to see if there is an incorrect amount showing as owed).

I was still very concerned about the events that have transpired and I asked for details of this to be provided to me in writing. I received your letter of 29th July outlining what was said on the phone but did not reflect the correct position.

I later received statements showing a debit and a credit of £697.37 dated 28th July.

My balance outstanding with you since 21st July was £468.39 bringing my account back to within my agreed overdraft limit by the date you stipulated.

Therefore, please advise the following:

Given that you declined me a refund of charges under hardship criteria and given my actual outstanding balance with you was £468.39, on what basis was the amount of £697.37 showing as a debit then a credit to my account as at 28th July?

What has happened to my £200 payment made on 15th July by telephone which is not recorded on any statement or correspondence?

I believe given the above and as per my previous correspondence, you have dealt with me very unfairly and incorrectly as follows;

· in the time taken to review my hardship request,

· in the issue of the default notice whilst this review was ongoing and the account under dispute (the result of which would directly impact amounts owing by me)

· in the issue of the default notice which is non compliant with regulations and whilst being fully aware of my personal circumstances and the impact this would have on them and my borrowing ability – making it all the more difficult to pay you back and ensuring my hardship is further secured

· despite complying with your request and bringing my account into line within your deadline, you intend to report to credit referencing agents a default from me of an incorrect amount satisfied at zero

· in going against what I was told on 15th July 2010 and closing my account

· in failing to record my payments incorrectly

· in reaching a settlement agreement without any approach to me and without my agreement and at an amount I did not owe

I look forward to your response. For your information, I may refer this matter to the Financial Ombudsman for review.

Yours sincerely

[jdes26]

interesting thread

 

i hope you can get a result