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    • Thanks Bank Fodder for laying out the pro's and cons.   I think that because the missing paperwork on the 100k service was missing will help in our favour, as Ford say the automatic gearbox must be serviced at either 35k or 2 years which it wasn't, this was disclosed at the time of sale and only a very basic service was done and stamped in the book.   I am very surprised that the finance company closed the complaint so quickly.   At the moment the car is at an independent garage, luckily it is where I get my van serviced so I know the owner. Should we leave the car there as in one of the emails the finance company told him not to drive the car, or shall they drive it home which is around 3 miles?
    • I'm trying to think in terms of tactics here.   Because the vehicle purchase has been made on hire purchase, that means that the finance company is the owner of the vehicle and strictly speaking your direct action is against them in breach of contract because they have all the obligations to you under the consumer rights act that they would have if they had been the dealer. On the other hand I still like the idea of going against the dealer – which you could do on the basis that you enjoy third party rights of direct action under the Contracts (Rights of Third Parties) Act 1999. Of course you could sue the finance company and you could win – in fact you probably will win: there is clearly been some kind of misrepresentation at the very least – and maybe a deception. It's rather a coincidence isn't it that certain important information has been omitted from the documents supplied to you. However, if you sue the finance company then I don't think it will provide a quick solution. From what you have told us so far it seems to me that there is a certain urgency. I think that the finance company will simply get into obstructive mode and simply try to cause you trouble – because they will instruct their usual solicitors – and I'm afraid to say that solicitors are incapable of taking a pragmatic view. The longer it goes on then the more they can charge the client. The more obstructive they can be then the more there client naïvely is impressed – and at the end of the day the more obstructive they become, the more likely they are to wear you down and to achieve some kind of negotiated settlement where you agree to sacrifice some of what you are entitled to – and the client – the finance company then sees that as some kind of – Win. I think a quicker route to success is to sue the dealer – and at the same time you could bring an FOS complaint against the finance company. Of course if you sue the dealer, they will start off by pleading that you don't have a contract with them. That's true – but you would be relying on the provisions of the 1999 act – and it is clear that you are an intended beneficiary of the contract and I scarcely imagine that they have expressly excluded your rights to bring an action against the dealer. I would expect they hadn't even thought about it. One of the rules about bringing a complaint to the financial ombudsman service is that you are not allowed to do that if there is a legal action underway at the same time. I can imagine that if you brought a complaint against them to the FOS, that the finance company will plead that there is a legal action – but I think that you would have a good argument to say that the legal action is against the dealer and that the complaint to the FOS is clearly independent of that legal action. The FOS is very cosy with finance companies – and they may accept the position of the finance company and refuse to be involved – but on the other hand they may side with you and continue with their investigation against the finance company. This would mean that you would have two irons in the fire at the same time. You could simply bring a complaint against the finance company to the FOS – but as I've already suggested, this will take an awful long time and it may not be resolved before 12 months is up – meanwhile you have the problem of not having the vehicle. So my favourite course of action at the moment is to threaten the dealer with a legal action on the basis of your third party rights – and separately to begin a complaint to the FOS about the finance company. I think the dealer would be extremely surprised to find that they were subject to the legal action when they had thought that they are being protected by the hire purchase rules. However, I think that they would eventually be obliged to confront the reality that they were going to be a defendant in the court case. I think they are the weakest link and they are the route to getting the fastest result. I see that the dealers describe themselves as some kind of finance company themselves. But I don't notice any FCA registration or any other signs that they are a finance company or that they have the kind of expertise behind them which you would expect the finance company. Have you any further ideas on that point?  
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    • Hi Dx, I have only just started helping them yesterday, all the complete so far has been done by my son in law. I am just getting all the correspondence together and make a full list later
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Lloyds charges making life hard


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Hi I am hoping to defend our business from further damage by Lloyds bank and want to know how best to proceed.

 

We opened our account in 2010 with a loan of £60,000 from an apparently supportive bank manager who promised to give us an overdraft when we opened. We met the repayments for 6 months whilst rebuilding before we even opened.

 

We needed a further loan of £25,000 to complete the refurb which we received on the understanding that we took out life insurance with Lloyds. We did so and received the loan which enabled us to complete the project.

 

Sadly 2 weeks before we opened the manager suddenly passed away. When we first met our new manager she appeared to take a very dim view of us and dismissed any notion of an overdraft on the grounds that we had not met our targets 2 weeks after opening. We had never been warned that our admittedly (with hindsight) over-optimistic business plan was a binding document.

 

Since the start of our relationship the new BM has been rude and unhelpful has repeatedly allowed payments to go out then called them back then charged us, probably at least £100 pcm and sometimes more. This has made it extremely difficult to manage the account as we are never sure what will come out next sometimes payment are made and recalled 3 times! We have shut down as many DDs as poss and use the account as little as possible.

 

We feel we have been unfairly treated as an overdraft would have prevented these charges, the business overall is not in much debt and is improving and has the potential to grow into a sustainable business currently employing 5 people.

 

Currently we owe £900 in charges and cannot use the account at all. We feel we were mis-sold the life insurance at £120 pcm which we paid for about 1 year and we are being unfairly treated and exploited to raise revenue through charges when an overdraft would resolve the situation.

 

any advice gratefully received.

Edited by slick132
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Hi Forties and welcome to CAG

 

I've moved your post into your own thread and used paragraphs so your post is readable.

 

Here are 2 links that you should read :-

 

http://www.consumeractiongroup.co.uk/forum/showthread.php?387431-Letter-before-Action-Removal-of-Charges-under-Hardship-criteria-BCOBs

 

http://www.consumeractiongroup.co.uk/forum/showthread.php?387436-Letter-for-consideration-regarding-Hardship-or-Financial-Difficulty

 

Even though yours is a business a/c, because there is lending involved, The Lending Code should apply. Accordingly, if the bank fail to provide you with o/d facilities that enable payments to be made, surely this means you are in Financial Difficulty........

 

........ In which case, the bank should be offering you every assistance available including the reduction or stopping of interest and/or default charges.

 

Have you considered moving to another bank with a BM you could work with better. It is possible that the current BM could pull the rug at any time wrecking all your plans and leaving you with no business and no money.

 

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Hi Slick123 and everyone else.

Thanks for your reply and warm welcome.

I am unsure how to proceed re Hardship, does this apply to the business or the owners, we are a partnership, working other jobs to make ends meet and repay business related credit card debts. The business struggles on a day-to-day basis as takings fluctuate greatly week to week and seasonally.

I would welcome opinions on the following points:-

1,Does the original BMs verbal agreement to give us an overdraft upon opening carry any weight. We certainly would not have opened an account where we had no possibility of getting one.

2, Can we reclaim the life insurance we were mis-sold?

3, If so should we repay the charges with that money get the account active again before moving to another bank.

4, The state of our account reflects badly on the business and would, I assume , make it very difficult to open another account. How should we proceed?

 

I would be grateful for any advice, its great to find somewhere supportive after a tough 3 years.

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Hi Forties,

 

If you had nothing in writing from the BM, the verbal agreement or any other discussions that were not in writing are likely to count for nothing.

 

If you were/are suffering Financial Difficulty, The Lending Code should apply equally to individuals or Micro Enterprises. If the bank knows you are struggling, they should be pro-active in trying to help as I said in my penultimate paragraph above. Your approach about this should be made in writing and you can ask them to stop adding default charges and interest. No guarantee that they will, but it's worth a shot.

 

Re the Life Insurance, who would benefit in the event of death of one of the business partners.

 

When you say WE, is this you and who else - ie a spouse or an unrelated business partner.

 

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Given that the account doesn't have an overdraft facilities I''m not sure that the lending code does apply in this instance - unless you are actually having difficulty in paying your business c/c or your loan repayments.

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If items are being returned unpaid, that suggests the a/c has been going into unauthorised o/d.

 

This is covered by The Lending Code.

 

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If items are being returned unpaid, that suggests the a/c has been going into unauthorised o/d.

 

This is covered by The Lending Code.

 

:-)

 

I would have thought that it suggests the exact opposite.

If they are being returned unpaid then the bank isn't willing to let the payments take you into an unauthorised overdraft?

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Hi all, thanks for your replies.

We are a partnership of 3, myself my husband and a friend. I think the cover gave each individual enough to cover the loans from the bank.

Yes the account is and has been in unauthorised overdraft several times, I need to clarify if the Lending Code applies or not.

We did not want and could not really afford the insurance but it was made clear that we would not get the 2nd loan unless we signed up for it. Surely this is undue pressure to buy.

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Hi Forties,

 

Re the insurance, was each individual's life covered for the full amount of the loans.

 

Personally, I'm not sure the imposition of life insurance was necessarily mis-selling in the same way as the PPI scenario. In your case, the bank (arranged by the original BM) felt obliged to cover itself in the event of death of a partner. You were given a clear choice - take the insurance or you don't get the loan. They didn't impose any accident or illness cover, which I think would have been far more questionable.

 

Was it undue pressure to buy ? I'm not convinced it is challengeable but I hope others may comment.

 

If there was a cycle of the a/c going in and out of o/d, then I think you have grounds to argue that the bank were obliged to assist the business by stopping or reducing default charges or interest. The Lending Code would be my starting point, followed the threat of direct court action using BCOBs. Don't threaten court action unless you are fully prepared to take it.

 

:-)

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