"Unenforcable" Credit Agreements - let's get it out in the open

druss

rog2 wrote: »

If a creditor or dca fails to supply a true, compliant copy of the executed consumer credit agreement within 12 working days of receipt of the debtor's request, and £1.00 Statutory Fee (bit less than £300+) then, as already stated, they are in default and can no longer enforce the agreement without first seeking permission from the Courts.

It is at this stage where the debtor can cease making payments.

The debtor may also demand that any defaults, entered by the creditor/dca are removed from his/her crf.

Rog2 you are right in law this is fairly black and white you are legally entitled to stop paying at this point.

But the lenders are not playing by the rules, they are refusing to ackowledge the account is in dispute, I've seen letters from lenders that say we don't agree there is grounds for dispute, and the clients have incurred a default on their credit file even when the lender has been unable to supply an agreement!

Ive seen defaults and county court judgements registered at previous addresses even though all statements etc go to a new address.

Lenders are only unable to use enforcement via the court, defaults do not need to be registered by the court and are usually treated in exactly the same way as a ccj by lenders when it comes to applying for a mortgage/other credit.

I am merely stateing for the good of anyone reading that if they have a good credit rating and do not want an uphill batlle to get adverse information removed from their credit file -

my advice would be to continue paying until they have in writing from the lender that they acknowledge the credit agreement is in dispute and they will not be able to enforce.

Beware if they do provide the agreement at a later date you are liable for all missed payments and interest incurred.

Without a solicitor or yourselves instigating court proceedings the lenders wont roll over and write it off.

The amount owed will still be recorded on your credit file, it will be ignored with regards to your credit rating and received payments but if you apply for a mortgage/other credit the lender will still take the credit into afforability calculations, I know i have a client is an underwriter for one of the major uk lenders (claiming against 9 of her own cards/loans) and this is how they would view it.

As to getting your credit file amended experien etc will put a notice of correction on your credit file, but lenders underwiters are told to ignore these and treat them as a bad debt, lender blames credit ref agency, credit ref agency blame lender.

Legally the law is on your side

Reality is unless you are willing to fight the lender will register bad credit anyway.

I'm sorry if that doesnt sit well with you for being 'safe' but I know my customers appreciate it.

louiser123

so after you have requested the cca and they send one with the signiture box there but no signiture thats not enforcable, i know i havnt signed any agreement at all with two catalogue companys,

fermi

louiser123 wrote: »

so after you have requested the cca and they send one with the signiture box there but no signiture thats not enforcable, i know i havnt signed any agreement at all with two catalogue companys,

That does not prove they do not have a signed agreement (but you know they don't).

As said, under the request they are permitted to omit (or blank out) "any signature box, signature or date of signature".

But if you know for a fact that they have no signed agreement for a pre April 2007 account, then in theory it should be unenforceable.

Should that go to court you would have to carefully defend it on those grounds though. If you don't the court will not automatically take it into account.

rog2

druss wrote: »

Rog2 you are right in law this is fairly black and white you are legally entitled to stop paying at this point.

But the lenders are not playing by the rules,

Legally the law is on your side

Reality is unless you are willing to fight the lender will register bad credit anyway.

Hi druss - I certainly don't claim that the cca request proceedure is a simple, or straightforward, proceedure, and I totally agree with you when you say that 'Lenders are not playing by the rules' - they seldom do when it is they who are in the wrong.

Anyone who chooses to excercise their legal rights to the protection that the Consumer Credit Act, 1974, affords them should be prepared for resistance by creditors - after all the creditor, or dca, has everything to lose, whereas the 'debtor' will not be in any worse position than he currently is if they do come up with a valid cca.

However, there are both laws and official guidelines to which creditors should adhere, and the debtor should, wherever possible, ensure that he/she is aware of these rules and guidelines. Yes, the debtor could engage the services of a reputable solicitor, but in most cases advice sought, and taken, from forums such as this and the consumer action forum is more than sufficient.

Certainly if a creditor/dca does obtain a true copy of the executed consumer credit agreement after the legally prescribed time period has expired, that creditor/dca may be able to enforce the agreement, but only by seeking the permission of the Courts. If this happens, then the 'debtor' should state, in defence, that the creditor had not complied with his/her original cca request, backing this up with dates etcetera. The Court will need a pretty good reason as to why the creditor/dca failed to honour his legal obligations under the Act and could, indeed should, still declare the agreement 'irrideemably unenforceable'. However, and I do accept that this is the real world, if the Court judges in favour of the claimant, then, even at that stage, the defendant debtor can still apply to the Court to make payments, including those which he/she had stopped paying once the creditor was in default, at a rate that he/she can reasonably afford, based on his/her income/expenditure. It will be up to the Court to 'judge' how much that 'payment' will be, and any such 'judgement' will be just as binding on the creditor/dca as it would be on the debtor.
Providing that the debtor, then, adheres to this judgement, then any further attempt by the creditor/dca to try to make the debtor pay more will then be seen as harassment, which is a criminal offence.
Equally, should a creditor/dca obtain a CCJ against a debtor at a previous address, whether knowingly or not, then there are proceedures for the debtor to apply to have the Judgement 'Set Aside' or reviewed.
As you say, druss, 'Legally the Law is on your side'. You must be prepared to fight, if necessary, for the rights that the Law affords you.

druss

Its a shame we cant upload docs they make wonderful light entertainment.

Exmp1

Further to your enquiry we havnt responded to your request because we can find no record of having received one.

This from the same lender who had managed to bank the clients £10 and £1 fees for the requests.

Exmp2

A completely blank application form sent back as a 'true copy of credit agreement'

Exmp3

A monthly credit card statement and a covering letter saying please find attached 'true copy of credit agreement'



and my all time favourites, ive seen this from a few lenders


We have mislaid the original agreement please find enclosed a replacement agreement can you sign it and return.

~Brock~

druss wrote: »

Its a shame we cant upload docs they make wonderful light entertainment.

Exmp1

Further to your enquiry we havnt responded to your request because we can find no record of having received one.

This from the same lender who had managed to bank the clients £10 and £1 fees for the requests.

Exmp2

A completely blank application form sent back as a 'true copy of credit agreement'

Exmp3

A monthly credit card statement and a covering letter saying please find attached 'true copy of credit agreement'



and my all time favourites, ive seen this from a few lenders


We have mislaid the original agreement please find enclosed a replacement agreement can you sign it and return.

Completely agree that the above are laughable.

It must be annoying, however, to receive a perfectly legible copy of the original agreement in the post, as I suspect you do in the majority of cases. Darn that nasty Consumer Credit Act.

AMILLIONDOLLARS

Fermi

you state:
The Prescribed Terms are these:

A Amount of credit

A term stating the amount of credit

What is covered under this term. If the contract is not showing how much in total is being paid for the credit would this be a breach of the ACT. Post 2006

AMD

~Brock~

AMILLIONDOLLARS wrote: »

Fermi

you state:
The Prescribed Terms are these:

A Amount of credit

A term stating the amount of credit

What is covered under this term. If the contract is not showing how much in total is being paid for the credit would this be a breach of the ACT. Post 2006

AMD

Post 2006 (I assume you mean post April 2007 in practice) the agreement will not be irrecoverably unenforceable.

Depending on the type of agreement (e.g. variable interest rates / credit cards) there may not be a requirement to show the total that has to be paid, because it is not known.

druss

~Brock~ wrote: »

Completely agree that the above are laughable.

It must be annoying, however, to receive a perfectly legible copy of the original agreement in the post, as I suspect you do in the majority of cases. Darn that nasty Consumer Credit Act.

Brock you would be amazed, we have less true copies back than you would imagine, far less.

We want the agreements back.

we are convinced that the reason why many lenders are not sending back the majority of agreements or only partial agreements is because they are flawed and would speed the process up, the solicitors would have something to look at and be able to check the agreements for flaws!

From a lenders point of view the longer they can drag a case out the more payments they will receive in the meantime.

Just like they are doing with the OFT and bank charges, they cant defend the indefensible so lets delay as long as possible.

For anyone still unsure whether all this is ligitimate check out the legal jobs /recruitment like this here

http://www.indeed.co.uk/Consumer-Credit-Litigation-Solicitors-jobs

demand will continue to increase

fermi

AMILLIONDOLLARS wrote: »

What is covered under this term. If the contract is not showing how much in total is being paid for the credit would this be a breach of the ACT. Post 2006

As far as I am aware it is the "amount of credit" rather than the "total charge for credit" that is a prescribed term for a fixed sum credit agreement.

That is how I read it anyway. Before you rely on that, you would be best of to ask somewhere like CAG.