Can DCA re-default a default?

[OneStepLeft]

Hi all,

 

I am currently disputing a default from a current account overdraft. However in the meantime, "my debt" has been sold to a DCA and the default marked satisfied under a partial settlement special instructor.

 

Regardless of the dispute outcome, if there is a deed of assignation (and even if there is not) can a DCA default the debt under a separate entry? Basically is it possible for the same debt to appear twice on a credit report as a default.

 

Thanks,

 

OSL

[tifo]

no, a default cannot appear twice for one debt.

 

however, it can be sold and a default re-submitted by the buyer.

 

in your case, as you have settled, i would doubt a default would be entered again.

[OneStepLeft]

no, a default cannot appear twice for one debt.

 

however, it can be sold and a default re-submitted by the buyer.

 

in your case, as you have settled, i would doubt a default would be entered again.

 

Many thanks, but I have not settled the debt, but it shows as satisfied on the original creditors default entry as they have sold the debt to the DCA.

 

So in this case, if the debt is sold on 10 times, a total of 11 defaults could (theoretically) appear?

[tifo]

So in this case, if the debt is sold on 10 times, a total of 11 defaults could (theoretically) appear?

 

No ... only 1 default can show for 1 account.

 

When it is sold, the creditor has to remove their default in their name, and the new creditor will then issue their own, in their own name.

 

In this way, an account can be in default forever (theoretically) as the creditor can sell it just before the 6 years (when it falls off).

 

This is why debt agencies chase 5 year old accounts.

[InKogneeToh]

Hi OneStepLeft,

 

Welcome to the forum

 

I'm afraid I disagree with tifo on this point. I believe that only one default can be issued per debt. If a creditor sells it on to a DCA then they can register it in their name but it should be dated the same i.e. from the original date of default. Otherwise you could have a perpetual default showing on your record. See the article below and judge for yourself.

 

Also I don't see how a DCA can default you of their own accord (from a new date) unless you have entered into a payment arrangement with them and then breached that arrangement.

 

This is my own interpretation but apparently some guidelines are soon to be issued from the OFT/FSA (not sure which) in the near future that will hopefully answer these questions once and for all.

 

Caledonian Express, UK - Credit, Loans and Banking : Mortgages, Remortgages, Loans (secured and unsecured), Car Finance, Credit Cards, Bank Accounts

 

Regards, Pam

[tifo]

Pam, we've discussed this in detail on the other thread.

 

The way i state it is the way it seems to work, however, maybe some debt agencies use their own new date and some decide to keep the old one?

[InKogneeToh]

Hi tifo

 

I guess we will have to just agree to differ on this one but as we know, most DCA's are a law unto themselves and either do not know, or choose to ignore, applicable legislation etc.

 

Until this is clarified by OFT/FSA I shall challenge any DCA defaults and they will have to prove me wrong!

 

Regards, Pam

[OneStepLeft]

Thanks for the info both of you.

 

I hope this situation does not occur. I am actually liable for the debt in this case and will now be settling with the DCA as soon as I can bring myself to make the call, purely because the DCA in question has a horrific reputation online (Thames Credit). However I honestly never received any default notice or even any calls about it and have sent a CCA letter from that link.

 

I spoke with the bank (on phone and in branch) who were less than helpful and could only give me details about the default that the credit report already gave me. Critically (hopefully) they could not tell me what address the default was served to (which would help me understand why I might not have received the notice) so I am hoping that this means that I might be successful based on the letter. I am assuming that that CCA clause refers to overdrafts in addition to the more common types of credit.

 

Call me cynical, bf the bank takes the default off and it is resubmitted by the DCA (as described), then I would imagine a "I'll pay it off in full" offer to the DCA would be more likely to be successful in getting the default removed than with the bank themselves?

 

Again, thanks.

[tifo]

I am actually liable for the debt in this case and will now be settling with the DCA as soon as I can bring myself to make the call.

 

Call me cynical, bf the bank takes the default off and it is resubmitted by the DCA (as described), then I would imagine a "I'll pay it off in full" offer to the DCA would be more likely to be successful in getting the default removed than with the bank themselves?

 

Why are you going to pay it off if the debt was assigned as it should have been by law?

 

I doubt they would take the default off, but would show it as settled.

[OneStepLeft]

Why are you going to pay it off if the debt was assigned as it should have been by law?

 

I doubt they would take the default off, but would show it as settled.

 

Sorry I am a bit confused by that. Could you elaborate?

 

I still owe the money, which is why I am planning on paying it off (to the DCA not the bank).

 

The default already shows as Satisfied (is that the same as Settled?) as the DCA paid the Bank, therefore the bank marked it Satisfied.

[OneStepLeft]

Oddly and perhaps related, but today I went into my Credit report, and the account entry for a credit card for the same bank, not the same account I reference in this thread has disappeared. It was a couple of years old so perhaps it is just coincidence.

[Johnnyc]

no, a default cannot appear twice for one debt.

 

however, it can be sold and a default re-submitted by the buyer.

 

in your case, as you have settled, i would doubt a default would be entered again.

 

 

Hi,

 

Just so i can understand this better. I have some defaults which are due to fall off my files. Can this debt now be resold and a new default put on my file without my having any agreement with the prospective new buyer?

[OneStepLeft]

As far as I can see, yes, that *could* happen because you have not settled the debt.

 

You are not obliged to pay it after 6 years, but it could still be present on your file for as long as the chain continues and it remains unpaid.

[tifo]

The default already shows as Satisfied (is that the same as Settled?) as the DCA paid the Bank, therefore the bank marked it Satisfied.

 

No, the bank marked it satisfied because they sold it at a discount to the DCA. The DCA did not pay your debt, they bought it for, maybe, £3 per £100 of debt. Then they try and get the whole amount from you. The bank just writes off the difference in their tax.

 

The DCA can then issue their own default for the debt, but the bank would have to remove their own.

[OneStepLeft]

No, the bank marked it satisfied because they sold it at a discount to the DCA. The DCA did not pay your debt, they bought it for, maybe, £3 per £100 of debt. Then they try and get the whole amount from you. The bank just writes off the difference in their tax.

 

The DCA can then issue their own default for the debt, but the bank would have to remove their own.

 

Yep, sorry, I didn't mean that the DCA paid my debt in full, but rather sold on at a discount (been reading so much on the subject my eyes are set to pop).

 

Hopefully I will have success with the CCA I sent to the bank regarding non-receipt of the default notice. Presumably if I pay the DCA (which I am going to do) then the matter will be closed apart from the default.

 

What would be a realistic amount to offer the DCA for full and final settlement, and also would the CDA levy charges which I would *have* to pay?

[Johnnyc]

No, the bank marked it satisfied because they sold it at a discount to the DCA. The DCA did not pay your debt, they bought it for, maybe, £3 per £100 of debt. Then they try and get the whole amount from you. The bank just writes off the difference in their tax.

 

The DCA can then issue their own default for the debt, but the bank would have to remove their own.

 

 

Can they issue a default if there has been no contact in the last six years?

 

There was a default registered less than six years ago, but I have had no contact within the last six years. Eg Default may 2001 last contact july 2000. As far as I understand it this debt is now unenforceable due to the Limitation Act? ???

[InKogneeToh]

Hi all

 

I really think this warrants a letter to the relevant authority (Is it OFT?) that regulates the credit industry. If it is correct that defaults could be entered ad infinitum (which I am not personally convinced about) then this has HUGE implications for consumers.

 

Since a bankrupt can now be discharged in as little as 6 months and can then start to rebuild their financial lives I don't see how it can possibly be fair to have a situation where a credit consumer could potentially be 'blacklisted' for an indefinite period. I realise that a notice of bankruptcy stays on the credit report for 6 years but when a bankrupt is discharged there is often a lot of his debt left unpaid. I am certain that none of his creditors can then pursue the unpaid debts after the date of discharge (within the 6 year period) and cannot enter new adverse information on his credit file, so how could it be fair to continuously impede a non-bankrupt debtor's financial recovery in this way?!

 

Regards, Pam

[tifo]

Hi Pam ...

 

nice to see you again ...

 

this issue follows us everyhere ....

[Johnnyc]

Hi all

 

I really think this warrants a letter to the relevant authority (Is it OFT?) that regulates the credit industry. If it is correct that defaults could be entered ad infinitum (which I am not personally convinced about) then this has HUGE implications for consumers.

 

Since a bankrupt can now be discharged in as little as 6 months and can then start to rebuild their financial lives I don't see how it can possibly be fair to have a situation where a credit consumer could potentially be 'blacklisted' for an indefinite period. I realise that a notice of bankruptcy stays on the credit report for 6 years but when a bankrupt is discharged there is often a lot of his debt left unpaid. I am certain that none of his creditors can then pursue the unpaid debts after the date of discharge (within the 6 year period) and cannot enter new adverse information on his credit file, so how could it be fair to continuously impede a non-bankrupt debtor's financial recovery in this way?!

 

Regards, Pam

 

Thanks for the info - this site is very helpful. Re these defaults , this seems like a ridiculous [problem] by the DCA's which could be never ending as they shuffle the papers from one arm of their organisiation to another.

[tifo]

this seems like a ridiculous [problem] by the DCA's which could be never ending as they shuffle the papers from one arm of their organisiation to another.

 

Exactly right .....

 

and the banks also collude ... after 5.5 years they sell the debt on ... thereby starting another 6 year cycle ...

[OneStepLeft]

Does the fact that this is an agreed overdraft affect me in any way? I.e. this is not the typical loan or credit card scenario, and I am not sure I signed anything specifically relating to the overdraft, so I am assuming it is contained within the T's and C's of the current account agreement I did sign?

 

Just hoping the CCA request I sent is valid in this case, as I saw another thread where a DCA came back in a letter and said it was different because it was an overdraft, although other people contributing to the thread told the thread starter that was rubbish.

[InKogneeToh]

Hi,

 

It would appear, according to an OFT document on agreements I have just read, that overdrafts are EXEMPT from the CCA. See excerpt below. I don't really know what else you can do, apart from paying up, as you said you would, and hoping the DCA doesn't add a new default.

 

Regards, Pam

[InKogneeToh]

Sorry, forgot to add the excerpt from OFT. :o

 

 

There are two further, highly specialised, types of exemption which can be granted by the Office of Fair Trading from, among other things, the rules on form and content of agreements. A general exemption has been granted for the Bank of England, other banks and licensed deposit-taking institutions, in respect of their arrangements for providing overdraft facilities on current accounts.

[OneStepLeft]

Thanks Pam, apparently I need to spread some reputation around...!

 

I found something similar at this link - BBA - British Bankers' Association - BBA Response to the DTI Consultation Document on the Financial Limits and Exempt Agreements - Question 16.B

 

Does it categorically exclude the requirement for the bank to respond to CCA requests though? Clutching at straws maybe, however the text does say it is a partial exemption.

 

Hi,

 

I don't really know what else you can do, apart from paying up, as you said you would, and hoping the DCA doesn't add a new default.

 

Regards, Pam

 

Based on your previous responses, are you saying that the risk is the DCA can add another entry with the same date, or append a new name to the existing default (and hence have the same date).

 

Would credit searchers see two defaults or one, regardless of whether they had identical amounts/dates?

[InKogneeToh]

Hi

 

I've read the info. in the link you posted and it seems to me that overdrafts ARE regulated agreements under the CCA but have partial exemption in that the banks do not have to comply with the 'form and content' part of the Act so a normal written agreement is not necessary. They must however give OD limit and interest charges etc. in writing.

 

So, as far as section 77/78 CCA requests go then they do not have to send copy of 'executed' agreement as there wouldn't have been one of these but they are still required to send state of account statement etc.

 

Regarding the default issue, this is the big debate at the moment but I would not accept 2 different dates/entries on my file for the same debt and would challenge it vigorously!!

 

We have not yet been able to locate any definitive answer to this so can only hope that the new regulatory body (??) can set the record straight once and for all.

 

The only thing you can do is check your credit records at regular intervals and, if any default is repeated, challenge it in whatever way seems appropriate.

 

I'm sorry I can't give any straight answers but I am just a Joe(anna) Public and still trying to make sense of all this legislation myself.

 

The great disgrace of the CCA's inception is that until quite recently ( internet access etc) the ordinary public knew only that it existed but had no idea of ALL their rights under the legislation. Lenders put only as much CCA info. as legally required into their credit agreements and in my opinion have profited enormously from our ignorance.

 

Well, I think our collective message to them now is

 

YOUR GAME IS UP!!!

 

 

Rant of the day completed!

 

Regards, Pam