Another Minicredit thread (sorry)

[Oh ffs]

Hi all, been reading these forums and finding some great info - thanks. I've pretty much arranged repayment plans with all my creditors, apart from Minicredit that is. I can see many issues with these sharks on here but not much in the way of outcomes, positive or otherwise.

 

 

 

Basically I've taken out a loan of £250 from these pirates at the end of April 2011 and paid the interest (rolled over the loan) in both May and June. It gets to 31st July and I owe them £250 + interest which I reckon is around £340 assuming a 1% daily compound interest per the contract/loan agreement.

 

I defaulted on the loan and therefore they slapped on default charges of £25 and a further £55 per the contract. I paid £50 a couple of days after this and have emailed them to no avail explaining I shall be able to pay the remaining balance as at that date by 1st September provided no further fees or interest. These emails have been ignored and/or bounced back.

 

Now the balance stands at £721.50. This morning I called them and asked for a breakdown of this balance as this clearly they are charging me more per day than 1% interest as per the contract. Apparently they are charging daily! for each failed collection (my debit card details have changed and I haven't provided them) and a further £100 doorstep collection fees 'per the contract' but I should logon to my account to see the balance (which is actually showing as 'debt collection' stage). I know the balance, that's why I queried it! There is only mention of 'reasonable' fees in the contract and this doesn't stack up as reasonable to me! I offered £400 this morning to wash my hands of them thinking they would take this but I was informed 'this wasn't enough'.

 

Without going into too much more detail, my work will be seriously affected by a CCJ and I as much as I would love to defend a claim with the court I can't afford to risk it. What's the best approach? Keep offering £400? Ask what they are prepared to settle for? I can't afford to pay £721.50 or whatever it is by tomorrow and I told them as much, hence the lady on the phone asked what I could afford (and then stating that's not enough).

 

I've read they are only legally entitled to the original amount + one month interest. Which law states this? The CCA?

 

I guess what I want to know is - has anyone successfully settled in such a way with minicredit and how did they manage this? Oh and don't worry, I shall be complaining to the OFT etc.

[dx100uk]

all you owe is the orig loan amount plus 1 months int

 

minus any payments you have made

 

pay them no more than that

 

dx

[Oh ffs]

What's the legal grounding for that? Not disputing it but i want to get all my facts straight

[maroondevo52]

Hi,

 

The reason behind the original loan and one months interest is due to Section 87 of the CCA Act. the whole amount of the loan automatically becomes due on the expiration of the original term. Unfair terms and conditions come into play as well.

 

Since the Rule of 76 abolished the norm is for 3 months interest if you want to pay a commercial loan back early, therefore the 1 month was decided for non-secured short term loans. It's been argued at mediation hearings successfully and gives a guideline for 'proper' negotiation, not the bullying "every time I phone you it is going to cost..." talk you get from these companies.

 

Regards.

 

Scott.

Edited September 1, 2011 by maroondevo52

[sillygirl1]

Yes, it's just lead to a case being struck out by another payday loan lot, Section 87 says they cannot add additional default fees as it has automatically defaulted. The £100 doorstep collector charge MUST be reported to the OFT and Trading Standards

 

http://www.tradingstandards.gov.uk

http://www.consumerdirect.gov.uk for the OFT

 

Don't fall for the £3 daily attempted charge either, it is not valid and there is no legal back up for this. Just because it may be in their T&Cs doesn't make it legal or fair.

 

Keep all communication in email then you have positive proof of the way they bend the rules to suit themselves.

 

Simply changing your card isn't enough, you need a new account with a different bank to be completely safe.

[Oh ffs]

Thanks everyone.

 

Does anyone have an email address for them? I try and do it through their website and it doesn't work.

[Oh ffs]

I've managed to send an Emal via their faq and will be following this with a call. Let them know that I am disputing the debt and that i don't understand why my balance is so large considering the account is 33 days in arrears. Requested full breakdown of balance and let them know I am unprepared to pay the amount they state is owing but will settle for less.

 

I also read the OFTs debt collection guidance and needless to say they have contravened it plenty. Will be shopping them via the relevant channels.

 

Thanks for all your help, I feel more confident that should it go to court I would have a good defence.

[sillygirl1]

Don't waste your time calling them. It will serve no real purpose.

 

At the end of the day all you owe is the original loan and one months interest, read other threads in the payday loan forum and you will see that this has been proved in court time after time.

 

They are trying to play games with their fees and charges. They are in the wrong. Requesting breakdowns is no help either as they will make them up to suit their needs.

 

Report them to

 

http://www.tradingstandards.gov.uk

http://www.consumerdirect.gov.uk (for the Office of Fair Trading)

 

as they are being completely unreasonable in not allowing you to make a repayment and not freezing fees and charges (which they LEGALLY cannot charge - read up on Section 87 of the CCA Act).

[sillygirl1]

If it does go to court I can do a defence for you, 9 times out of 10 with payday loan companies if they go to court it doesn't get past the allocation stage as they don't want to fork out £80 for that and then go in front of a judge - they would have a hell of a grilling....

[Oh ffs]

Thanks Sillygirl. I only want a breakdown to gather evidence before anything goes further etc. Forward planning basically.

I have my head screwed on after reading up on things, im not going to back down

[sequenci]

Don't waste your time calling them. It will serve no real purpose.

 

At the end of the day all you owe is the original loan and one months interest, read other threads in the payday loan forum and you will see that this has been proved in court time after time.

 

They are trying to play games with their fees and charges. They are in the wrong. Requesting breakdowns is no help either as they will make them up to suit their needs.

 

Report them to

 

http://www.tradingstandards.gov.uk

http://www.consumerdirect.gov.uk (for the Office of Fair Trading)

 

as they are being completely unreasonable in not allowing you to make a repayment and not freezing fees and charges (which they LEGALLY cannot charge - read up on Section 87 of the CCA Act).

 

Can you clarify this legal position for me, I'm a little confused by this one loan + 1 month idea. For the record I'm pretty well versed in what s87 CCa '74 actually does. I would be very grateful.

[StarFang]

Can you clarify this legal position for me, I'm a little confused by this one loan + 1 month idea. For the record I'm pretty well versed in what s87 CCa '74 actually does. I would be very grateful.

 

I'd also like to know this too. It's quoted often on these pages but not with a full explanation of why.

[sillygirl1]

I've summed this up at least 50 times,

 

Because the original loan term has ended the only outstanding amount is the original loan, plus any interest

 

It's been tried and won in court so please read and digest. That is the basis of the law. Since the abolition of the Rule of 79 Section 87 of the CCA Act has preference, and it clearly states that if the original loan term has ended (the one month period) then only the loan and interest are due. Even big companies can only charge 3 months interest on outstanding loans.

[sequenci]

It's been tried and won in court so please read and digest. That is the basis of the law. Since the abolition of the Rule of 79 Section 87 of the CCA Act has preference, and it clearly states that if the original loan term has ended (the one month period) then only the loan and interest are due. Even big companies can only charge 3 months interest on outstanding loans.

 

I assume you mean the rule of 78, that has absoilutely nothing to do with the need for default notices as per s87. Sorry for the confusion but I'm really lost by all this.

[sillygirl1]

The original loan term (the initial one month) has ended and the loan has not been repaid, therefore the default is automatic. If everyone keeps questioning this tried and tested law I will no longer be posting on the payday loan threads.

 

I've spent a lot of time and effort drumming this into people and the few people who are questioning every step of the law need to take stock. I will not post on threads now where this is being questioned, its been tried and won in court so the law is clear

 

One month loans only are that, for one month, and when not paid at the end of the loan period then they AUTOMATICALLY default, therefore default fees and interest cannot be charged. Also as the loans are also on a very high interest rate that is the real crucial killer.

[sequenci]

I'm sorry if you feel that way, I'm just keen to seek clarification for my own understanding - as I'm sure others are too. I was always led to believe that interest CAN be charged beyond the point of default, and there is a vast amount of case law that seems to back this understanding up. As payday loans have blown up over the last couple of years we are keen to be party to any lawful strategies that can assist people with their financial difficulties.

 

Best wishes,

 

Seq.

[sillygirl1]

Because a payday loan has a high interest to begin with when the loan defaults then technically (again proven by case law as you like to state) CONTRACTUAL interest (ie 8% only and not their up to 245678% or whatever) can be charged. It is a minefield legally and something does need to be done.

[sequenci]

Because a payday loan has a high interest to begin with when the loan defaults then technically (again proven by case law as you like to state) CONTRACTUAL interest (ie 8% only and not their up to 245678% or whatever) can be charged. It is a minefield legally and something does need to be done.

 

Sorry to bother you, but it's points like this that we need further insight to. Why would it revert to stat interest on default?

 

There is a fair amount of work going on to combat payday loans, so we are keen to understand all potential strategies. It certainly is a minefield.

[sillygirl1]

In the latest Minicredit case they cite pre and post judgement interest at contractual rate.

 

I have been one of the main people involved in the PDL scene for some time now and need to take a back seat as I haven't got the legal training nor time to deal with the large number of cases, I am doing on average 3 defences a week, resulting in none of them actually going to court - they nearly all fall down at AQ stage as the PDL company doesn't want to be questioned.

[StarFang]

Sillygirl I'm really sorry you feel this way, but many of us don;t have the luxury of being able to trawl through threads to seek clarification. Maybe it should be made a sticky, and then other forum members can direct people there.

[AndyOrch]

SG have we a copy of one of these agreements I would like to see the T&Cs (particularly the Default key information)

 

Regards

 

Andy

[sillygirl1]

I think somebody has cut and pasted up one of their agreements, I believe you can also see their terms and conditions on their website. I will see if I can get hold of one.

[sequenci]

Here is an extract from a Wonga agreement's t's & c's:

 

If you do not repay your loan in full and on time we continue to charge interest on the outstanding

balance. The rate of interest will be the same as shown above.. Interest after default is calculated daily

and applied to the loan amount every 30 days (or when the outstanding balance is repaid in full if earlier).

The rate of interest may be charged before as well as after any court judgment.

 

We may charge all the costs and expenses (including enquiry agents, debt collection agents and legal

costs) reasonably incurred by us in enforcing this Agreement.

 

And The Lending Stream's:

 

DEFAULT CHARGES

 

You will be in default under this Agreement if you do not pay us the Total Amount Payable (the money you owe us) by the Payment Date in accordance with this Agreement. Also, if you fail to make payment in accordance with this Agreement on the scheduled Payment Dates, you will be in default of this Agreement and liable to pay the following;

£12 for each payment due which is unpaid on the due date;

£10 if your account remains in default 34 days after the relevant Payment Date;

£40 in the event that we cannot agree a repayment plan for an account in default or such a repayment plan is not sustainable such that we have to refer your account to external debt collection agents; and

any other reasonable expenses and costs that we may incur in taking steps to enforce our rights under the loan agreement including tracing you if you move without notifying us and legal expenses;

default interest at the contractual rate.

 

I would really like to try and find the t's and c's of all the main players so we can compare and contrast them.

 

I'll start another thread asking for info a little later on (sorry to the OP for the thread hijack btw)

[Oh ffs]

I have today received a letter from Minicredit, or should I say a 'DOORSTEP COLLECTOR NOTICE'.

 

Amount overdue £812

Debt recovery costs £100

 

Total balance due £713

 

Clearly this doesn't even add up!

[sillygirl1]

Report them, they CANNOT charge £100 for a doorstep collector who has no powers whatsoever. This is against the OFT Guidelines on debt collecting big time

 

http://www.tradingstandards.gov.uk

http://www.consumerdirect.gov.uk (for the Office of Fair Trading)

 

Yours could be the complaint that tips the balance come licence renewal time.