unenforceable loans.

sam_wells

has anyone actually had a successful claim on an unenforceable loan.
my husband is trying to make a claim from hfc bank, as when he took out the loan they based his income on not only his wage, but my wage, child benefit, child tax credit and working tax credit. but the loan was in his name only and nothing to do with me. when he took the 7000 loan they told him what payments would be and he signed, however 2 weeks after taking out the loan they phoned to say did they explain the interest rate and how much u would have to pay back, (they did not) and was totally shocked to find it was over 16,000.
i have written to them asking for a copy of his credit agreement. they have not sent it, but have sent a letter to say for 8 weeks only if he pays the balance off he can have a reduction of 50%. do u think they are doing this as he has a good case as an unenforceable loan. thanks.

cyril82

sam_wells wrote: »

has anyone actually had a successful claim on an unenforceable loan.
my husband is trying to make a claim from hfc bank, as when he took out the loan they based his income on not only his wage, but my wage, child benefit, child tax credit and working tax credit. but the loan was in his name only and nothing to do with me. when he took the 7000 loan they told him what payments would be and he signed, however 2 weeks after taking out the loan they phoned to say did they explain the interest rate and how much u would have to pay back, (they did not) and was totally shocked to find it was over 16,000.
i have written to them asking for a copy of his credit agreement. they have not sent it, but have sent a letter to say for 8 weeks only if he pays the balance off he can have a reduction of 50%. do u think they are doing this as he has a good case as an unenforceable loan. thanks.

Sounds like they don't have the agreement, if they don't they cant enforce the agreement.

I would not involve a fee charging claims company in this case.

When you say you requested the agreement did you send a formal request with a £1 postal order? If you did and they don't supply it after a total of 44 days they are in default of the consumer credit act and can not legally demand payment from you.

You then have control and can offer what you think is fair.

That is pretty much how it works.

sam_wells

thanks . i did send a formal request enclosing a £1 postal order. i downloaded a template letter from a site which gave them 12 days to reply, it has only been about 21. not gonna use a claims company gonna do it myself and then if i,m not succsessful it hasn,t cost me anything for trying.would u wait until 44 days have passed and write to them again. thanks again

cyril82

Well the law states that after the 14 days passes the company are in default of the consumer credit act if they have not provided the agreement.

At this point i believe you are within your rights to notify the company you are suspending all payments until they comply with the request and the company are not supposed to charge default interest on the payments or class them as missed payments or arrears since it is they who are in default not you, although i can't say for sure that they won't record it on your credit file as i have heard stories on here of lenders doing so in these circumstances all i can tell you is they should not do it and if they do you should report them to the OFT.

after another 30 days passes they commit an offence as defined by the consumer credit act. At this point if they continue to demand payment and apply default interest and charges they are committing an offence.

This is when the balance shifts and you can control negotiations more due to the fact the lender has no power to enforce the agreement
.

sam_wells

thanks cyril82. you have been most helpful.

oscar52

cyril82 wrote: »

after another 30 days passes they commit an offence as defined by the consumer credit act. At this point if they continue to demand payment and apply default interest and charges they are committing an offence.

It is no longer an offence after the 30 days.

cyril82

oscar52 wrote: »

It is no longer an offence after the 30 days.

Either way, it still becomes unenforceable and it is an offence if they try to collect payment without producing the agreement.

The company can admit to not having the agreement and that they can not enforce and then ask you to pay but they can not charge default interest, arrears or threaten legal action etc etc, they can merely ask you to pay.

Also if they just ignore the request and continue trying to enforce the agreement they commit an offence.

sam_wells

you say they can ask you to pay but does that mean you have to pay. if you don't pay and they cant make you, after 6 years does the debt get written off. not bothered about credit file being affected as it is a shambles anyway. cannot obtain any credit at all.

orangetrader

Bear in mind if the lender subsequently comes back with a copy it becomes enforceable again at that point. some lenders will produce a "true" copy which isn't an actual copy but a document which they claim is a reconstruction of the original document.
Basically you either need a) the lender to acknowledge that the credit agreement doesn't exist and that the debt is unenforceable in writing or b) a copy of the agreement and grounds to show that it is unenforceable so that you can negotiate with the lender.

The date when you took the loan is important. If after april 6th 2007, the outcome, if it went to court, is not as predictable as the court will have discretion over whether the debt is enforced or not.

cyril82

sam_wells wrote: »

you say they can ask you to pay but does that mean you have to pay. if you don't pay and they cant make you, after 6 years does the debt get written off. not bothered about credit file being affected as it is a shambles anyway. cannot obtain any credit at all.

When i say they can ask for payment if they admit to not having the agreement i mean that is all they can do, if you don't pay they can't enforce payment in anyway, that is why they will usually write it off.

cyril82

orangetrader wrote: »

Bear in mind if the lender subsequently comes back with a copy it becomes enforceable again at that point. some lenders will produce a "true" copy which isn't an actual copy but a document which they claim is a reconstruction of the original document.
Basically you either need a) the lender to acknowledge that the credit agreement doesn't exist and that the debt is unenforceable in writing or b) a copy of the agreement and grounds to show that it is unenforceable so that you can negotiate with the lender.

The date when you took the loan is important. If after april 6th 2007, the outcome, if it went to court, is not as predictable as the court will have discretion over whether the debt is enforced or not.

What you say here is not true, a lender must provide a true copy of the document with your signature on it, if what you are saying was true all the lender would have to do to comply with a request for a copy of the consumer credit agreement would be pluck a blank loan agreement out of the filing cabinate and bingo, job done. That is not the case.

You are right about the date, it has to be before April 2007 or the courts do have discretion.

OP does the loan date back to pre April 2007?