Cap1 & CCA return

[m55dlc]

The banks are not writing off the debt, they are selling it. That is the point. There has not been any writing off of debt - no debt has been written off - nothing, zip. In this case, a DCA now owns the whole debt, the banks took a hit as to the market value, they make a loss, they call it written-off, but in true terms, the individual agreements have not been written off, but a portion of the debt the bank holds has been disposed of, and the terminology therefore would make it sound like a number of agreements have been written off, but that would not be correct. I had 500 apples, that I valued at £500.00 in total (£1 each). 10% went bad so I sold them for £7.50. My apples are now worth only £450, so with the £7.50 I realised I have to write off £42.50 of their original worth. The apples I sold may well realise more money to the firm I sold them to, good luck to them, those apples are rotten and will give them trouble.

[JonCris]

The £1700 hasn't been removed from the debt. The £1700 is still part of the debt, the DCA now owns that.

 

Not if they have written the £1700 off. Once part written off they have nothing to sell other than the portion that they sold

[m55dlc]

I agree but what I'm saying is that on the one hand if they write the debt off then they have nothing to sell.........if they don't sell all of it off whatever the sale value that is all they are allowed to claim

 

Thats not what my business head is telling me. Don't mistake writing off with writing down. They are only getting rid of bad debt and therefore by selling it for any price they want (as they are entitled to do) does not devalue the sum owed by any individual in any way whatsoever.

[Smoothy]

The banks are not writing off the debt, they are selling it. That is the point. There has not been any writing off of debt - no debt has been written off - nothing, zip. In this case, a DCA now owns the whole debt, the banks took a hit as to the market value, they make a loss, they call it written-off, but in true terms, the individual agreements have not been written off, but a portion of the debt the bank holds has been disposed of, and the terminology therefore would make it sound like a number of agreements have been written off, but that would not be correct. I had 500 apples, that I valued at £500.00 in total (£1 each). 10% went bad so I sold them for £7.50. My apples are now worth only £450, so with the £7.50 I realised I have to write off £42.50 of their original worth. The apples I sold may well realise more money to the firm I sold them to, good luck to them, those apples are rotten and will give them trouble.

Thats exactly what I thought. except for damn expensive apples....

Im just nipping off to find a book I read about profiteering....!

[m55dlc]

I agree it would take a lot to convince a court of this argument but we need to remove the wood from the chaff.......If the bank rights off the debt (no matter what they may call it) then the liability no longer exists.

 

The liability was sold prior to writing off the monies. An account isn't written off, the values quoted is the total amount of money their entire debt base has shrunk negated by the amount they sold it for, nothing else. The liability is already transferred and therefore still thrives

[m55dlc]

Ooooh guest count

12:27 15 guests......

12:30 16 guests......

12:35 16 guests......(Still? Maybe these are legit - it is lunchtime afterall)

[Smoothy]

Currently Active Users Viewing This Thread: 22 (6 members and 16 guests)

 

will the mystery guests please sign in!

[JonCris]

If my car is repossed & sold at auction for below equity value then the lender or DCA is only entitled to claim the outstanding amount not the whole amount............If the lender writes off part of the debt as implied by selling it at a much lower value then that is the extent of the debtors liability

 

If I write to you saying I'm writing off £5 of the £10 you owe me I can't then pass the full £10 debt onto another......Of course for this scenario to work we would need to find out how much of the debt had been written off

[JonCris]

16 guest! I hope they are getting well paid

[JonCris]

I've just heard through the grapevine that a Lender/DCA is about to lose a major case

[Smoothy]

Ok...so let me put this scenario to you...

If a bank claims I owe £2000 then they sell the debt to a DCA for £360....

Am I liable to pay the DCA the £360 they paid for the debt or the full amount payable to the bank under the agreement?

[Smoothy]

I've just heard through the grapevine that a Lender/DCA is about to lose a major case

Sounds interesting...do tell!!

[m55dlc]

If my car is repossed & sold at auction for below equity value then the lender or DCA is only entitled to claim the outstanding amount not the whole amount............If the lender writes off part of the debt as implied by selling it at a much lower value then that is the extent of the debtors liability

 

If I write to you saying I'm writing off £5 of the £10 you owe me I can't then pass the full £10 debt onto another......Of course for this scenario to work we would need to find out how much of the debt had been written off

 

And you will not be able to as an account isn't written off. It is sold in a valid transaction at less than market value. The money listed in the thread is only written down (not off - off is the misquote from the BBC) at the debt book level, not individual accounts.

 

As far as the lender selling it at a much lower value, that value in no way whatsoever affects the extent of the debtors liability. It is merely representative of the wholesale value the bank has assigned to it, not the retail value of the debt. The bank doesn't tell you they are writing off the debt and then sell it, they just say 'your account has been sold' (if you're lucky). I'm still not happy with this as an avenue of attack, please, please give me something to change my mind.

[JonCris]

The liability was sold prior to writing off the monies. An account isn't written off, the values quoted is the total amount of money their entire debt base has shrunk negated by the amount they sold it for, nothing else. The liability is already transferred and therefore still thrives

 

Whilst I disagree I do appreciate you arguments I do understand that this involves some lateral thinking on my part.....but then many would have said much the same about bank charges until the likes of CAG came along

[m55dlc]

JonCris

 

As I said earlier, I'm playing devils advocate here. Convince me!

 

The premise is that an account is a commodity, like anything else. The value of a commodity is defined by the market. I believe I have something that is worth X, but something transpires that it isn't worth what I thought it was. It should be worth X, but I am unable (or unwilling) to undertake all that would be necessary to make it return X, therefore I have to make a decision and sell it for Y. I have made a loss therefore of X-Y. I haven't written off X-Y, I am just unable to realise X for my something. Now, as X-Y has now left my total worth, as an entity with shareholders, I need to be transparent and come clean about this loss. I therefore have to state to all and sundry that I have N x (X-Y) scenarios, and therefore the total value of my credit card business has decreased by that amount. The total number of accounts I hold has decreased, therefore I tell the world that I have written off Q (Q = N x (X - Y)). Q, therefore, is totally devoid of X or Y, and as such is not apportionable to any account I still own. I as an entity has made a loss of Q, not by writing off X, but by not attaining X when I sold it. I only made Y. The difference between X and Y in any transaction is not written off, has not been written off and in no way what so ever could be deemed to be written off. The difference between X and Y is now the problem of the person I sold the debt to previously.

 

As I said before, I'm in IT and business, not law. This is business, not law.

[JonCris]

smoothy sorry can't tell yet will when matters are concluded

[FANTASY CHARGES]

Right, the bank may well have written-down the value of a debt on their books, but that doesn't by any stretch of the imagination (or law) equate to writing off the face value. How else would you have trade price and final price on anything? We live in a free market economy and what I sell a banana to you for doesn't mean you can not charge what you like for it.

 

Likewise, if I decide to call it a day on a credit card account with a balance of £2k, if I sell it to a DCA for £300, I haven't written it off, I've just made a loss on it. The debt wasn't written off, the value of the debt on my books wasn't realised completely.

 

So I'm still in need of a little bit of convincing on this

 

i DOUBT IF they made any loss withe the interests rates they charge i believe MBNA is charging £3% of any cash taken out of a machine which almost being the rate of inflation is "extortionate"

 

there is a whole section in the 1974 cca

---------------------------------------

we don't seem to have mentioned it (138 4.a mentions creditors and risk if they can make "charging orders" on then because the risk is lower shouldn't the interest rate not be extortionate?

137 Extortionate credit bargains

(1) If the court finds a credit bargain extortionate it may reopen the credit agreement so as to do justice between the parties.

(2) In this section and sections 138 to 140—

(a) “credit agreement” means any agreement (other than an agreement which is an exempt agreement as a result of section 16(6C)) between an individual (the “debtor”) and any other person (the “creditor”) by which the creditor provides the debtor with credit of any amount, and

(b) “credit bargain”—

(i) where no transaction other than the credit agreement is to be taken into account in computing the total charge for credit, means the credit agreement, or

(ii) where one or more other transactions are to be so taken into account, means the credit agreement and those other transactions, taken together.

138 When bargains are extortionate

(1) A credit bargain is extortionate if it—

(a) requires the debtor or a relative of his to make payments (whether unconditionally, or on certain contingencies) which are grossly exorbitant, or

(b) otherwise grossly contravenes ordinary principles of fair dealing.

(2) In determining whether a credit bargain is extortionate, regard shall be had to such evidence as is adduced concerning—

(a) interest rates prevailing at the time it was made,

(b) the factors mentioned in subsections (3) to (5), and

© any other relevant considerations.

(3) Factors applicable under subsection (2) in relation to the debtor include—

(a) his age, experience, business capacity and state of health; and

(b) the degree to which, at the time of making the credit bargain, he was under financial pressure, and the nature of that pressure.

(4) Factors applicable under subsection (2) in relation to the creditor include—

(a) the degree of risk accepted by him, having regard to the value of any security provided;

(b) his relationship to the debtor; and

© whether or not a colourable cash price was quoted for any goods or services included in the credit bargain.

(5) Factors applicable under subsection (2) in relation to a linked transaction include the question how far the transaction was reasonably required for the protection of debtor or creditor, or was in the interest of the debtor.

[elizabeth1]

16 guest! I hope they are getting well paid

 

 

It's just been on the Radio about Bank charges on Jeremy Vine show etc.. - maybe CAG got a mention?? could explain some guests right now?

[JonCris]

They are all at lunch it would appear..........lets plot!

[InKogneeToh]

Oh, JonCris, you've frightened them away now!

[JonCris]

naw there'er off to the canteen for cup & a cream bun

[Smoothy]

Yeah sure...

[JonCris]

Smoothy I think I've been to that cafe

[Smoothy]

Lol....me too!

[Smoothy]

And there was me trying to be diplomatic!