negligent/irresponsible lending?

[d77]

Advice, please?

I feel that LloydsTSB and Black Horse Personal Finance have colluded, and exacerbated a situation entered into with SPML

This is going to sound like the intro to an x-factor audition, get your violins ready...

2 years of Prozac-fog ended last November, and I am now lucid, and really quite angry. Feel free to slap me down if I’m just whinging.

The Prozac episode followed a very messy repossession and subsequent breakdown. To be honest, if I hadn’t been so blinkered about pre-existing medical conditions and PPI, the Prozac would have happened much sooner.

In 2002, Abbey National reached the end of their tether with our sporadic mortgage payments (Husband came out of work, I was working part time...) they went for repossession over arrears of £800. Fair play to them.

In stepped the saviours that are Capstone/SPML, and confirmed a remortgage to cover the loan, arrears, court costs etc. Seemed a great idea at the time, hindsight’s a wonderful thing. The honeymoon period was great, the monthly payments were only slightly higher than the Abbey ones (the ones we couldn’t maintain). Honeymoon over, and the introductory rate bounced up, the payments rose from something in the region of £200 to over £400 per month (I don’t have the exact figures, this was pre-prozac, there’s a good chance that the paperwork is stuffed down the side of a sofa somewhere.)

LloydsTSB were ever so good, there was a little button on the internet banking screen that said ‘increase overdraft’, so a cycle began of us missing a monthly payment or two, getting a nasty letter from SPML, and increasing the overdraft, paying off the arrears, and starting all over again. I got a bit fed up of forever being in overdraft, and asked Lloyds for a loan to straighten everything up. Now, we didn’t fit the lending criteria for Lloyds....but, Black Horse ‘our sister company’ were happy to accept us. I think this is when it really started to go pear shaped.

The first loan with Black Horse was ‘only’ about £3000, and things ran smoothly for a while, we were on the edge of our income, so every time we had a vet bill, a domestic appliance die on us, or any other unexpected expense, we were back in the overdraft. We were both working, so Black Horse had no issues with increasing the loan when we got sick of the overdraft fees.

We ended up with an overdraft of £7500 before Lloyds asked what was going on. I was very clear with them that we were struggling to keep up with our outgoings, and they converted the overdraft to a special agreement of a separate loan, £75 a month, which we managed to pay every month because the due date was the same day as my wages. Over this period we had also been increasing the Black Horse loan, as SPML really liked sending out court claims for possession. I was also very clear with Black Horse as to the purpose for the extensions on the loan, I recall them actually speaking to SPML and coming to an agreement that SPML would agree to the loan being secured against the property, as long as their arrears were cleared first, before any other debt was repaid.

There was another instance where a family member paid off the arrears on the mortgage pending a further advance from Black Horse being transferred, there was full three way discussion between SPML, Black Horse and the family member at this point.

The house was repossessed in November 2008. I was ‘out of it’ to such an extent that I had just assumed that I would be able to ‘sort it out’ again, as had happened over the past 5 years or so.

Looking back, it might have been less stressful for everyone involved if Lloyds/Black Horse/SPML had not colluded and allowed us to build up the debts to such unmanageable levels. It seems in bad taste to say so, but if the repossession had taken place earlier, rather than Lloyds allowing further increases on the overdraft, Black Horse allowing further advances on the secured loan when the credit files showed that this was an on-going pattern, and SPML accepting several 11th hour payments, many people would be much healthier and happier today.

My question is, do I have a case for irresponsible lending? Irresponsible borrowing, certainly, I hold my hands up to that. We knew every time that we extended our borrowing that it was not a solution, only a stop-gap, but felt that mainstream lenders would reject us on the basis of our credit history.

The current situation:

Black Horse debt £29000- in default for 18mths, with no legal action to date.

SPML (sold the house under-value) £3000 owed due to mortgage shortfall, instalments agreed with Scotcall, but defaulted October 2010.

Lloyds closed the account January 2011, £5500 outstanding on the loan, £866 on the overdraft (£3600 at the time of the repossession) First solicitor’s letter received last week, demand for £266 overdraft overlimit.

[rebel11]

Hi d7

 

Welcome to CAG

The guys will advise as soon as they are available.

[alfwithhair]

Something on the news this morning about this

First bank in the UK to be fined for irresponsible lending

http://www.bbc.co.uk/news/business-12536174

 

Might be a few pointers in the article for you to have a chew on

[d77]

Thanks, chaps,

 

We realised pretty quickly into the contract with SPML that what they wanted was a fast reposession while there was value in the house...

 

My bugbear is the Lloyds/Black Horse fandango- Lloyds wouldn't consider a loan, but continued to increase the overdraft to a point where I owed over £10000 in my own name, Black Horse didn't give a damn what the loan was for- I used to work for RBS, and the rule was "If you can't pay your bills, how are you going to pay the loan?"

 

I'm continuing to read through OFT guidance on lending etc- just strikes me as odd that, apart from a default notice every six months or so, BH haven't attempted to recover the debt- do they know they were in the wrong?

[alfwithhair]

BH send you a defualt notice every 6 months?

[d77]

They did, October and March or there-abouts- can't find October's and I fear that the previous ones may have become chicken nest box material...

[alfwithhair]

Once they have issued a default notice they can't keep issuing a new one every 6 months.

Have you checked your credit file to see what is recorded?

[d77]

D for default every month since June 2010. 6 for six months arrears for preceeding 6 months (although I don't think the payments were made for those months either) It's still registered on credit file as 'residential second mortgage'- bit odd, since there is nothing for it to be secured on (Spml/Acenden sold house under-value...)

[victoria_siempre]

Something on the news this morning about this

First bank in the UK to be fined for irresponsible lending

http://www.bbc.co.uk/news/business-12536174

 

Might be a few pointers in the article for you to have a chew on

 

Hi alf

 

Thanks for this. This is important and could be flagged more widely; 4 companies are mentioned and its a good general defence against being treated unfairly in mortgage arrears when old and interest only, which sadly applies to me.

 

x

 

v

[Tethersend]

I wonder if somebody could please help me as I am now at the end of my tether

 

In February 2008, I took up a trial membership with a company called Club La Costa. At that time, both my wife and I were in full time employment and the terms seemed affordable. In May 2008, we went to Spain for the "Free Holiday" and attended the mandatory breakfast meeting. Although we were told this would take no more than an hour, we were with the company rep from 10am until almost 7pm getting the hard sell to upgrade to Full Membership.

 

I do suffer from some fairly major mental health issues and diabetes and despite telling them I needed to eat and rest, we were constantly assured that we could finish soon. After agreeing to go with the full membership package, finance was hastily arranged and my trial membership relinquished as part of the upgrade. Unfortunately, my circumstances had changed and I was no longer in full time employment. I informed the rep of this and after commiserating with me, we spoke about my future plans where I told him that I was planning to work as a self-employed training consultant.

 

After about 30 minutes of waiting, our new Fixed Term credit was arranged with GE Money who also provided the credit for the Trial Membership. I have often wondered how we got the credit approved with having lost my job and only this morning I waded yet again through the pile of documents CLC left us with to discover that I am listed as a self-employed training consultant and had been doing that job for a year(??) As the original credit arrangement with the same company, dated only 3 months earlier had clearly stated I was in full time employment, I would have expected the most cursory of checks to have picked that up and credit refused!

 

I have read the FSA regulations regarding negligent lending but I am unsure whether my own case could be considered so?

 

Any help would be greatly appreciated... Please.

[liquidauctions]

I wonder if somebody could please help me as I am now at the end of my tether

 

In February 2008, I took up a trial membership with a company called Club La Costa. At that time, both my wife and I were in full time employment and the terms seemed affordable. In May 2008, we went to Spain for the "Free Holiday" and attended the mandatory breakfast meeting. Although we were told this would take no more than an hour, we were with the company rep from 10am until almost 7pm getting the hard sell to upgrade to Full Membership.

 

I do suffer from some fairly major mental health issues and diabetes and despite telling them I needed to eat and rest, we were constantly assured that we could finish soon. After agreeing to go with the full membership package, finance was hastily arranged and my trial membership relinquished as part of the upgrade. Unfortunately, my circumstances had changed and I was no longer in full time employment. I informed the rep of this and after commiserating with me, we spoke about my future plans where I told him that I was planning to work as a self-employed training consultant.

 

After about 30 minutes of waiting, our new Fixed Term credit was arranged with GE Money who also provided the credit for the Trial Membership. I have often wondered how we got the credit approved with having lost my job and only this morning I waded yet again through the pile of documents CLC left us with to discover that I am listed as a self-employed training consultant and had been doing that job for a year(??) As the original credit arrangement with the same company, dated only 3 months earlier had clearly stated I was in full time employment, I would have expected the most cursory of checks to have picked that up and credit refused!

 

I have read the FSA regulations regarding negligent lending but I am unsure whether my own case could be considered so?

 

Any help would be greatly appreciated... Please.

 

Ok so basically your not a self employed training consultant? If not then the finance is void simple as. You are more than welcome to send me a private message for some more guidance.

[Tethersend]

Thank you so much for your reply. I suspected this might be the case and I will certainly PM you if I may. My own research since making this post has shown me that this is a tactic that has been used by this company before and led to a claim being thrown out in the Manchester County Court in August last year.

[trout]

Listen, the whole point of this forum is to share info, not to pm, as posting benefits everyone.

 

Keep it on the forum

 

trout