Illegal Lending - Is it a Scam?

AllyF

I am currently looking at ways of clearing my debt and have been speaking with a local company who claim that for a fee of £500 per case (1 credit card/loan = 1 case) they will instruct their solictor to file a case for illegal lening under the Conusmer Credit Act of 1974. When I asked how this worked I have been told that until April 2007 lenders were not required to have a licence to lend money, so all agreements made before this date are technically illegal, and thus can have debts wiped out. They have stressed that this practice is not well known and it won't be long before everyone jumps on the bandwaggon.

They claim 100% sucess rate and have stressed that government are currently trying to pass a ruling to stop consumers following this course of action.
On the surface an out lay of £1000 for £15000 of debts witha restored credit rating sounds fab, almost too good to be true - hence I'm wondering if it is????
Does anyone know the answer or anything about this?

deedee_3

DON'T DO IT.

Do not pay anyone to do this. You can get all the information you need to do this for free from this site.

Someone will be along soon with the necessary info to help but in the meantime do a search of the forums for CCA.

All the best.

AllyF

Thank you!!!!! xx

RAS

AllyF wrote: »

I am currently looking at ways of clearing my debt and have been speaking with a local company who claim that for a fee of £500 per case (1 credit card/loan = 1 case) they will instruct their solictor to file a case for illegal lening under the Conusmer Credit Act of 1974. When I asked how this worked I have been told that until April 2007 lenders were not required to have a licence to lend money, so all agreements made before this date are technically illegal, and thus can have debts wiped out. They have stressed that this practice is not well known and it won't be long before everyone jumps on the bandwaggon.

They claim 100% sucess rate and have stressed that government are currently trying to pass a ruling to stop consumers following this course of action.
On the surface an out lay of £1000 for £15000 of debts witha restored credit rating sounds fab, almost too good to be true - hence I'm wondering if it is????
Does anyone know the answer or anything about this?

What a load of cobblers.This has nothing to do with the licensing of creditors at all or illegal lending.

Given the date they are quoting, what this load of sharks are referring to is that for debts taken out prior to April 2007, creditors have to produce a signed copy of the Consumer Credit Agreement under the Consumr Credit Act 1974 if they wish to pursue the debtor through the courts.

If they cannot produce the signed CCA in court, they cannot enforce the debt through the courts. The debt still exists and if you default, you may well find a default marked on your credit history, even if the debt is unenforceable.

Despite the fact that this law came in over 30 years ago, many creditors either had very poor practices or have lost the relevant documentation, so some debts are unenforceable. I would love to see what sort of guarantee this lot were offering as members of this board will tell you that whilst some creditors do not produce CCAs, other do. Some people have tens of thousands of debts that is unenforcable and since they already are defaulted, have ceased to pay, others have found that their few thousands are all enforceable.

I would strongly advise that you report this load of sharks to the OFT and the Trading Standards nearest their office.

Finally, you do not need a solicitor to check the status of your debts. It costs £1 plus the costs of a registered letter. A template letter can be found here or on the National Debtline or CAG web-sites.