Debt spiral due to account charges :s

[eonone]

Hi

 

Im looking for a little advice as for the past 7-8 months I have been struggling with debt. Mainly due to spreading finances to thinly but also due to Llyods TSB bank charges. Basically I have been in a spiral of paying the charges one month which doesnt leave me enough to pay bills etc and therefore paying charges the following month :s I tried cancelling direct debits and paying them when I had the cash to stop the £35 returned dd charges, but this only meant I missed payments and have occured a default with Black Horse (pay monthly on sofa) a default with my credit card - Mastercard, and a summons for Council tax.

 

I have phone the bank a few times asking them to step the penalties at least so I can get out of this vicious circle but they always tell me they cannot help and offer me a 'Refinancing loan' (what is this exactly?) which encompasses my overdraft (£2500) and my credit card (£5000) but they will not touch the penalties...

 

What advice can u give me to stop the circle?

[Bean]

eonone,

 

Welcome to the forum, you are in the right place.

 

Do not despair, you are among friends, many of whom know exactly what you have been experiencing because they have been through the same.

 

Read the FAQ's and as many of these threads as you can. If you are starting from scratch, it will take at least a couple of days to take it in but it is time well invested.

 

By following the step-by-step process you will be able to claim and recover what the bank has unlawfully taken from you. You can also demand associated defaults be removed from the credit register.

 

There is a letter in one of Spiceskull's Lloyds threads that should help to discourage charging while you make your claim.

 

Hope this helps,

[jonni2bad]

Banks have previously claimed that there charges don't do this, but I beg to differ. Charges because of charges is all too common, and I was stuck in the same viscious circle for too long.

 

You might wish to 'walk away' from the existing account - that is, to open another account, even a Basic account and move any income into it asap. This protects the money you have, and you then decide who gets what, on a fair percentage basis.

 

This has the effect of starting from scratch - going back to £0 as your norm, rather than say -£2500 (overdrawn).

 

In effect it's the same thing I did, although slightly less overdrawn at the time. The basic account will not have an overdraft facility, so you can only do whatever is possible with the money you have, not theirs. It was the best move I ever made financially, going back to cash to pay for many things really does bring home it's true value.

 

You can still use DD's and S/O's and make online instant payments etc for other bills. I'm with HSBC on their Basic Account.

 

I wouldn't initially recommend a loan, since you will be paying interest on the repayment of charges that they have unlawfully imposed on you in the first place - why should you pay twice?

 

Move away, offer a repayment based only on the amount you truly owe (i.e. not the charges) and tell them the remainder is in dispute.

 

Start the process of finding out what you have been charged over the past 6 years by completing the DPA request - and have a really thorough read of the FAQ section

 

You can also speak, for free, to trained debt counsellors at the CCCS

 

Freephone 0800 138 1111

 

If you want further advice on the repayment of debts, please let me know.

 

Good luck

[eonone]

Any other ideas?

 

Im mostly worrying about if I attempt to get my penalties back (of which must go into the 1000 pound mark) that they will close my account and I will be left having to pay 5000 credit card and 2500 overdraft in one go.

 

Also Im a bit concerned that I cannot see ANY LLoyds TSB mentioned anywhere in the settled accounts section of this forum, do they play hardball or something?

[Bean]

Suggest you search for 'retaliatory action' on this site,

[HD]

Also Im a bit concerned that I cannot see ANY LLoyds TSB mentioned anywhere in the settled accounts section of this forum, do they play hardball or something?

 

I know of several people who have got their money back from Lloyds TSB

 

http://www.consumeractiongroup.co.uk/forum/showthread.php?t=7048

[eonone]

Another question...I intend to send the dpa letter to Lloyds to find out exaclty what has been charged to me (approx 2500)

 

However having a 2500 overdraft, could this mean that the possible payback will be soaked up by the overdraft in my account?

[Bean]

Reading posts on this site from those who have reached a settlement suggests that a settlement sum is paid directly (presumably by some form of electronic transfer) into the account in question.

 

If this is correct, your overdraft would be reduced by the settlement sum.

 

IF matters proceed as they should, and retaliatory action is not a factor (though there is by no means a guarantee that retaliatory action will not occur) you should technically have the same facilities after your claim as before it.

 

Personally, I would look to reduce my liabilities as quickly as possible to an organisation that had caused me so much anguish, but I appreciate that circumstances and other priorities may not mean this ideal is possible.

[sweetcyanide]

I'm in a similar position- but am taking it as an opportunity to get out of debt You're going to have to pay it back one day- think of it as one less debt leaching from your income every month......

[eonone]

Yes I see what you mean...Also since I have a Mastercard with Lloyds TSB does this mean that I will need to include it with the claim on my current account or is it a seperate issue? Im guessing the latter...

 

Also is my Mastercard at risk when going forward with my current account claim as its maxed out at 5000 pound at the moment, and I dont want to risk them saying "we want to full amount back in 31 days or something"

 

Possible?

[jonni2bad]

You would need to keep those separate as claims.

[Bean]

In one DPA request, you can request data for all accounts held with one organisation. You pay a statutory maximum fee of £10 - so, for example, you could obtain information on your Lloyds TSB current account and your Lloyds TSB MasterCard by sending only one DPA request and only one cheque (or authorisation) for £10. Whether the organisation chooses to take your £10 offer is for them to decide.

 

When you have received your information you can decide which claims you wish to pursue. If you decide not to pursue them at the same time, the information will help you decide which to tackle first. Claims for different accounts must be made separately.

 

Hope this helps,

[eonone]

This topic was closed on 10 March 2019.

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