Urgent Help Needed - Court Says Pay £15,585.59 now to Funding Corporation

november

My sister had what she thought was a car loan with the Funding Corporation. When her husband lost his job and they missed a payment the FC asked for the full amount plus horrendous interest. She sought advice from CAB and Trading Standards but because it was a Bill of Sale not a loan no-one could help.

The original loan was for £8,000. The FC wouldn't accept any offer of payment and repossesed the car selling it for £3,000. This apparently leaves a debt of £15,584.59.

The FC have taken my sister and husband straight to court. My sister sent a budget to the court showing they could afford to pay £5.00 per month. CAB agreed that this budget was correct.

My sister and husband have now had the following letter from the court:

"Judgement for the claimant (after determination))

To the defendent
Before the proper officer sitting at ****** County Court apon the claimant not accepting the defendant's offer of payment.

To the defendent
The claimant has objected to the rate of payment you offered. The court has therefore decided the rate at which you should pay. You must pay the claimant £15,584.59 for debt (and interest to date of judgement) and £225.00 for costs. You must pay the claimant the amount of £15,809.59 forthwith.

Warning
Note to claimant and defendent. Either of you may object to the note of payment fixed. You must apply to the court with reasons within 16 days. A form is available from the court. A hearing may be arranged and you will be told when and where it takes place. If judgement is for £5,000 or more the claiment may be entitled to further interest and costs."

Obviously my sister is going back to CAB. She is now very worried that they will lose the house which is the only thing of value they own ...... this would make them and their children homeless. She was expecting to hear about a court date not to get a letter from the court saying that they would have to pay the full amount and presumably will have to object as they haven't got this money.

I think it is absolutely discusting that companies like this can act in this way. A £8,000 'car loan' costing over £15,000 and not being a loan at all but a Bill of Sale. And the fact that because it is a Bill of Sale they cannot get any free debt or legal advice. They can get free advice now hopefully it is a matter of dealing with the court but they couldn't on dealing with the Bill of Sale itself and were advised to just 'accept the debt' unless they could afford to pay a solicitor to fight it .... which obviously they couldn't :mad:

Any help or advice much appreciated. They were told by a debt advisor that there was a possibility they could lose their home over this as they have a small amount of equity in the property and it is the only asset they have!

funandfrugal

I am gobsmacked by this - surely it is not possible. Have you checked that the letter is really from the court? Not some pretend letter really from from the Funding Corp. Definately phone the court and check. I have been waiting 6 months for a court date it takes ages, maybe the Fc know this. Surely no judge would let this happen - it makes no sense. Definately go for the hearing. Also write to your local paper - people need to be aware of the Funding Corporation.
Sorry not much help but am really gutted for your sister. Please keep update this thread - I will be looking out for good news. Trace x

november

funandfrugal wrote: »

I am gobsmacked by this - surely it is not possible. Have you checked that the letter is really from the court? Not some pretend letter really from from the Funding Corp. Definately phone the court and check.

That's how I feel. It just doesn't sound believable but fortunately it is. And they have previously seen CAB, Trading Standards and phoned the free debt helplines for advice. Unfortunately my sis is at the other end of the country from me as well.

Yes the court letter is real. She had previous correspondence from the court about the FC taking her to court to which she responded. She was advised by all the above advisors that she had no choice but to accept the debt unless she could afford a solicitor (and barrister probably) to fight her case in court. Trading Standards said no-one has actually fought one of these cases because obviously when they occur the defendents don't have any money and they could be very very expensive if you lose. My sister was, however, expecting a court date rather than a letter from the court saying she owes the money!

She will be phoning the court on Monday anyway and CAB as they just can't pay. Its not a matter of they don't want to (although actually I don't see why they owe over £15,000 from a £8,000 car which has been sold for £3,000) :mad: I should also add that they had paid monthly payments every month until my bro-in-law lost his job so those would have been deducted from the amount owed as well presumably.

My sister can't go to the press - something to do with her job and not being allowed to.

chuckley

god what a company. what was the default amount?? what does the t&c's of defaulting say?? seems a bit drastic they demand full payment inc interest.

do u have the original paperwork?? what woulda have been the total payback of full loan with int??

sounds a bit dodge to me, as surely the courts woulda told ya of a date first?? rather than demand payment??

defo hop onto CAB with this. good luck. keep us updated.

CLAPTON

it's standard for the court to award the full amount unless you produce evidence that the amount is incorrect.

you now need to seek a redetermination of the amount...at this hearing the court will look at what you can afford... you can also make sure the court is local.

seek advice from http://www.nationaldebtline.co.uk/
telephone them and seek advice.

november

CLAPTON wrote: »

you now need to seek a redetermination of the amount...at this hearing the court will look at what you can afford... you can also make sure the court is local.

I think that is what they will do which is object to the determination as they will, at the very least, need time to pay. Why does the court ask for a budget though and the amount of payments you can afford if it just ignores it initially?

How do they seek a redetermination of the amount? Does this mean of the amount owed as they have been told that in order to do that they will need a solicitor which they can't afford. All the advisors so far have said they cannot question the amount owed unless they can afford to pay a solicitor to fight their case as it would be too technical for them to fight themselves in court as this is a Bill of Sale. So presumably they cannot fight against the amount the company is saying they owe them.

They are also aware that objecting to the determination (ie taking it back to court) will incur additional costs for them. Presumably this will just be added onto the debt? As they will need to object to the determination saying that they have to immediately pay the amount in full as they literally don't have the money.

seek advice from http://www.nationaldebtline.co.uk/
telephone them and seek advice.

They did originally and were told that debt advisors couldn't help as it is a Bill of Sale not a loan. They are going back to CAB because presumably they can now seek advice about the issue of ....... well making payment when you haven't got any money ....... I can't think of another way to put that.

november

chuckley wrote: »

what was the default amount?? what does the t&c's of defaulting say?? seems a bit drastic they demand full payment inc interest.

The default amount presumably is the full amount. Its the original loan plus PPI plus interest on both over what would have been the full term of the loan plus costs.

do u have the original paperwork?? what woulda have been the total payback of full loan with int??

Yes they have kept all the paperwork and requested a copy of the Bill of Sale. They received a copy of what they think is a Bill of Sale. It was not correctly filled in according to the legislation (no independant witness) but they were told by the debt advisors they couldn't fight that either without being able to afford a solicitor (same issue as before - you need to be able to afford solicitors and court costs). They have all paperwork including correspondance to and from the Company. In the case of from the Company that isn't much - they requested payment then took them straight to court.

PNPSUKNET

Dispute the ppi, throw a sting into it for FC

november

PNPSUKNET wrote: »

Dispute the ppi, throw a sting into it for FC

Any idea how they can do this? I've just read Martin's reclaiming guide but this wouldn't be reclaiming as such.

First thing Martin says to do is to write to the company but the company have already taken this to court. Then he says to take it to the Financial Ombudsmen but they have to get back to the court within a couple of weeks.

edited to add
I've just had a brief look at the form for putting in a complaint to the Financial Ombudsmen and wonder if its worth doing this anyway? They thought they were taking out a car loan and didn't realise nor were told it was a Bill or Sale nor about the PPI. Yes they should have read the very small very complicated print the debt advisors managed to work out meant it was a Bill of Sale but hindsight is a wonderful thing.

Although none of the advisors to date have advised them to do this - in fact I believe at least 2 of them said that because they signed the agreement they are more or less landed with it as even though they weren't told what it was and even though it wasn't correctly completed judges tend to side with the 'well you signed it so you agreed to it'. Does anyone know if this is actuallly the case?

november

Update with more bad news

Update is my sister phoned the court today. They said the initial determination was because her offer of payment was too small as it would take hundreds of years to pay back at the rate she offered. The Funding Corporation is therefore after a charging order on the house.

The court advised my sister to write to ask for a redetermination at which she will have to make a higher offer of payment. They also advised her to write to the Funding Corporation with a higher offer of payment but to be honest that seems pointless as the FC has ignored all offers and all correspondance to date. They obviously know what they are doing in taking this straight to court because my sister and husband own a house - the property is in joint names and has enough equity to pay this back and the loan is in joint names. I should add they only have a small house and not enough equity to do much more than pay back the money owed if it was sold and this would make them and their children homeless.

My sister has written today asking for the redermination and for this case to held at a court near them.

The court when she phoned were very helpful. However she did say it would be up to a judge to say whether or not any new offer of payment was accepted or not. She also said the Funding Corporation couldn't go ahead with the charging order until after redermination. Then they could go for the charging order and probably would as there was a lot of these cases now. If there was a charging order granted it would be up to a judge whether or not their home has to be sold so the Funding Corporation get paid.

I would say I am speechless that this can happen but from the start it has seemed like the Funding Corporation knew exactly what they were doing once the payment was missed. :silenced:

I've just done a google for charging orders and apparently they are for unsecured debts. So we are also at a loss why the Funding Corporation can apply for a charging order on a debt that was secured on a car they have repossessed? Unless it is because there is a remaining amount after repossession and sale and that is unsecured?

I would like to add my sister took the Bill of Sale to Trading Standards quite a while ago before it went this far. It is non valid due to some of the wording. However Trading Standards told her that no-one has ever challenged one in court due to the cost of doing so. He also said that it would be up to an individual judge whether or not the fact is was not valid counted.

Presumably the court has accepted the Bill of Sale in this case as the court official made the initial judgement they should repay in full. My sister did mention in her correspondence with the court that the Bill of Sale wasn't valid as it wasn't completed properly.

Also the original loan was for £8,000 plus interest. My sister has paid nearly £6,000 back (including repossession and sale of car). The amount of over £15,000 due now is for 10 years interest, 5 of which are 'up front' (for a period of time after the defaulted payment) which equals £10,000 plus £3,000 for PPI. So she owes £2,000 plus £10,000 interest plus £3,000 for PPI.

We would all be most grateful if anyone knows anyone who can help in any way. I can't believe a family can be at risk of being made homeless because they owe £2,000 on the original debt (plus the £10,000 interest and £3,000 PPI :mad: ) My sister is now looking into her work contract to see if she is allowed to go to the press for non work related matters as maybe that way she could get some help by a paper taking this on.

~Brock~

Firstly, the reason they can apply for a charging order is because they already have a judgement against your sister. It is irrelevant why the money was originally owed, or what it was borrowed for - the fact that a court has awarded a judgement in their favour is enough for them to apply for a charging order as one of the enforcement options open to them.

Enforcement options only become available if the payments required under the original judgement are not paid.

With all that said, however, it is very - and I mean VERY - unlikely that they would be granted possession of the house - I doubt that any judge in the land would grant possession unless it was absolutely clear that your sister is completely avoiding any type of payment.

Their tactic will probably be to simply sit and wait - for years if necessary - and hope to be settled off from the eventual sale of the property, should your sister ever decide to move.