Barclays loan default

King_David_2

This is a long story and does not involve myself as I am debt free - it involves someone I know.

This person decided to change job back at the start of November, moving about 17 miles away. They handed in their notice, and a week later were due to start in their new job.

The new job then tells her that the vacancy she is filling 'no longer needs to be filled' - leaving her unemployed as she has officially left her previous job.

She has a loan with Barclays over 5 years for £5000 which she could repay before this happened. Due to being unemployed Barclays have now called in the debt and are taking her through the courts.

Her dad has got a solicitor for her, and I have been told (from her) that she could be jailed (worst case scenario).

What are her options? Is bankruptcy an option - I thought that debt was a civil matter meaning jail didn't come into it.

Unfortunately, no other members of her family are in a position to stump up the £4400, and I can't either.

Any help or suggestions on this would be greatly appreciated.

Joe_Bloggs

The 'where to start' item at the top of the page iis the way to proceed. Whoever first mentioned prison is a scaremonger.
J_B.

jonesMUFCforever

First of all had she accepted the job that was no longer available (either verbally or in writing?)
If so could the solicitor or CAB not act to see if breach of contract applies here and tries either to get the new company to reconsider the job option or sues for damages?
Secondly she defaulted on her Barclays loan is this the first default or have there been others?
It would seem to me if solicitors are involved for Barclays that she is at least 3 payments in arrears so the job is a red herring ie she 's not been paying whether in employment or not!
If so CAB is cheaper than a solicitor.
Eric

deemy2004

The only thing Barclays will be interest in is the repayment of their loan, they won't be interest in this or that happened to your job, unless you try to arrange an extension to the loan.

Which means she should have got in touch with Barclays and pleaded for an extension to reduce the monthly payments, due to change in circumstances, rather that to just stop repaying the loan.

Like the others, I don't see what help a solicitor will be, as what happened to your employment is irrelevant to you owing money to Barclays, unless your talking about payment protection insurance ?

Prison is only viable if it goes to court and it is found that you have commited fraud i.e. being unemployed at the time of taking the loan out and thus having no intention of repaying the debt.

King_David_2

The loan was taken out around the middle of 2003 and had not been a problem until November this year.

She finished her job at the local council, had a weeks break and then went to start at her new job. I don't know the exact details but it was then that she was told that the position didn't need filling - so she hasn't willingly made herself unemployed.

This is the first ever time she has had this kind of problem - she has no credit cards or other loans, just this one with Barclays.

In response to the post above Deemy - she worries about this an awful lot and isn't the type of person who doesn't care. This isn't a case of fraud as I would appear in court if necessary to show that this is a case where things have happened out of her control.

She was purely moving from one job to another, with a weeks break in between.

The company she went to is the RAC call centre in Rugby - I will not name the council as they are not to blame.

louise1234_2

Hi - just to clarify, are you sure your friend has only missed one payment?? A default will not be issued after one missed pymt.

Is she claiming any benefits at moment?? Has she explained her financial situation to bank?? Is she hoping to get work soon?? Is she able to temp to get some income at moment??

Tell your friend not to worry, she can not go to jail for this. The bank can only take her to County Court & get possible CCJ against her. Which is a mark on her credit file & order to pay money back.

King_David_2

I'm not entirely aware of the details on missed payments, but think that it is more than one. She is of course looking for work as she does not like having to rely on benefits.

I hope to get some more info on her situation soon so will update you when I can.

Thank you for your comments so far.

louise1234_2

What I would suggest is she keeps the bank updated of her financial situation, if she cannot afford to make full/any repayments at moment, she should provide the bank with all the figures, and they will work from there.

Being honest with bank, and not making any promises she can't keep to will help her out & keep her in the best relationship with the bank.

Debt_Free_Chick

She has a loan with Barclays over 5 years for £5000 which she could repay before this happened. Due to being unemployed Barclays have now called in the debt and are taking her through the courts.

Her dad has got a solicitor for her, and I have been told (from her) that she could be jailed (worst case scenario).

Complete and utter tosh!

I assume that Barclays are taking her to the County Court to obtain a Judgement (CCJ) against her. This is just a formal record of a debt that is owed - though it will affect her credit record and mean that obtaining future credit (debt!) will be difficult.

She does not need a solicitor and paying for one is a complete waste of money.

When Barclays register their case with the County Court, she will get a formal notification of this. She will have a long form to fill in ... she must pay attention to this carefully.

Part of the form includes an offer from her to pay the debt by instalments. She has to include details of here income & other necessary expenses so the Court can assess how much she can afford to pay. If she can only afford £1 a month, this is what she must offer. She must not offer more than she can afford to pay!

Barclays seem to have gone down this route pretty quickly. Did she contact them to tell them of her difficulties?

Read more about CCJs here

http://www.nationaldebtline.co.uk/england_factsheets/factsheet_20.php3

And contact the National Debtline for FREE help about dealing with this.

https://www.nationaldebtline.co.uk

0808 808 4000

Her father is wasting money on a solicitor.

HTH

fubar_2

I have a similar thing with Barclay's I had a £6000 loan and was paying it just fine, then I moved jobs, the basic was a little less than I was previously earning but there was a very good monthly bonus scheme, not too long after the bonus scheme was stopped, so I was actually earning less and because wages were monthly paid I had to work a month with no salary, this put me overdrawn with the bank, and to make things worse the bank was charging £25 for each defaulted DD so I was in a catch 22 all the money I was earning was paying off the previous months debts so was back at square one with being overdrawn by about £150 at the start of a new month.

I approached Barclay's explained the situation I was in and asked them for a temporary overdraft of £400 which would have covered the DD's thus no £25 charge for each default (7 of them) they declined so I looked for another bank that would give me a overdraft facility on opening an account with them, Halifax gave me a £300 OD so I started the process of moving all my accounts from Barclay's to Halifax (I would point out that at this time I had got to the point of not opening the letters from Barclay's only to find out that they have charged me another £25 for a DD default) once everything was transfered to Halifax and I had set a standing order up to Barclay's to pay for the loan (I was making a late over the counter cash payments up to that point, so i did not get charged by Halifax) I received a letter from Barclay's that i opened (Knowing it could not be a £25 charge) but to discover that they had called in the loan, I immediately contacted them and asked what the hell was going on and was informed that they considered that the loan was at risk of not being re-payed, I asked what can I do, they said nothing as it was now in the hands of their internal collections group, 2 - 3 months went by with nothing heard, so i made contact again and managed to speak to the manager (a new manager) we made an appointment to discuss the problems. at the meeting this manager said that in all honesty he could not see why the loan was called in, he said that if i could make up the missed payments (£800+) he would open the loan again, I said that i do not have £800+ then he offered me another loan over 10 years that basically worked out that I would have been paying £20 less a month than the original loan but over 3 times as long, I left to think about it.

After i thought about it I could only think that they called in the loan simply because i had changed Banks, and then (partly their doing) thought i would be that desperate that i would take up any offer put on the table, this annoyed me to the point that I thought screw-em they can whistle for it now (even considered taking it to the bank ombudsman but never did), they took it to court and got a CJ and something like a warning put on the land registry that should I try to sell my house they would be notified, that was over 7 years ago, I had forgot about it until I received a letter from Barclay's Sept last year suggesting that if i would pay them £4000 they would consider the debt paid, so i thought I would take a loan (re-mortgage) to cover the re-payment and maybe do some home improvements, there i discovered that there was another debt with this warning attached to the mortgage (1st National Bank) i do not even know what i owe them (and in all honesty i thought this debt was covered on the insurance as I informed them I was unemployed over 7 years ago filled in other forms and never heard anything from them since) I contacted them in Dec asking what the debt is and what they want to do about it, I have heard nothing from them, I am about to ring them again and see how we can get this sorted.

I have a £25000 mortgage and was thinking about taking a £40000 2nd mortgage as the house is valued at around £75k - £85k this should cover all debts with Barclay's and 1st National, but will i be able to do this with these warning on the account, or do I have to get something in writing agreeing that these debts would be paid on completion of the 2nd mortgage, although Halifax never said that i could not have a 2nd mortgage, the bloke was very reluctant to progress any further once these 2 warning showed up.

Robert_Sterling_3

Her dad has got a solicitor for her.

Does "got a solicitor for her" mean he is paying a solicitor to give her advice ? or does it mean he got a solicitor for her and she will pay the solicitor for advice?

Either way a solicitors fees are not low.