Debt secured against property

Despondent

Firstly I will briefly relate the background to my problem. In April 1994 I was having difficulties managing my debts so enlisted the help of EuroDebt to sort out my problems. In June of 2005 I discovered this website and took your advice and withdrew control of my debts from EuroDebt and took control of them myself. I carried on making the payments directly to my creditors. One of these creditors was Egg Credit Card. I had asked them for the necessary documentation to make my payments by either direct debt/standing order or paying in book but in the meantime I paid them monthly by cheque. I did eventually receive a direct debit form to complete and returned this to them, but on subsequent months found that they were taking the minimum payment required instead of the payment agreed on the payment plan.

I contacted them and they repaid the extra amount taken into my bank and said they would send me a standing order form instead. I completed this and set up the standing order to start on 23 December 2005. I subsequently noticed that the payments for December, February and March had not been paid, only one payment had been made this was the January payment. I noted from my bank statements that these 3 payments had been made but returned by Egg.

I contacted Egg on 3 May to find out what the reason was for this as they had not contacted me about this. They said they didn't know and I was to contact my bank. I checked with my bank and the only thing they could suggest was that they had the wrong reference number and this was the reason the payments were being returned. They suggested the January payment had gone through because they must have traced it to me somehow. I then got the correct details from Egg again and found that the first 4 digits had been missing from the original request. I set up the standing order again and wrote to Egg on 3 May explaining what had happened and that all future payments should go through correctly.

I then received a letter dated 15 May from a Legal Collections company who are now demanding that I pay the amount in full (£3838.97) or increase my payment which was £32.44.

I contacted Egg as I did not feel this was fair as I had not deliberately set out not to fulfil my agreement with them and it was a mistake (on whose part I do not know). The person I spoke to said if I paid the 3 outstanding payments then they would withdraw it from the debt collection agency. As I was at work I could not do this as I had no debit card on me so said I would ring back. When I rang back the next day they denied this and refused to withdraw it from the debt collection agency as they said it was my responsibility to make sure payments were made.

The debt collection agency are now saying they will have to secure the debt against my property. I have since sent them a statement of means and made an offer to increase my payments to £40 pm but cannot afford to pay any more. I have heard nothing from them since.

I need to know whether they can secure the loan against my property. I am very upset about this as my home is jointly owned with my sister with whom I live and she has been very good to me over the last two years helping me out financially. I did not intentionally miss payments and have done my best to clear my debts. I know my debt situation is my fault and I am not trying to get away with sorting it out. I think Egg have been very unfair as it was me who pointed this situation out to them in the first place. They never contacted me to tell me my payments were not being received.

Thank you for any help and advice you can give me.

ktkrunch

I'm fairly certain they cannot secure debt against your property against your will; anyone know different?

CLAPTON

i think the threat of making a charge against the property is likely to be a scare tactic to make you pay more. i would guess (but can't know) that they are unlikely to actually pursue this.

however, if they do proceed, they will have to apply to the court and you will get the opportunity to put your side of the story.
if they suceed at court, it only really means that when/if the house is sold they will be able to get their money from the sale (after the mortgage co. has been paid)..it might make the selling process a little more complicated but it should not be a real problem to you or your sister.

Broken_hearted

I think they are trying to scare you. Egg passed us to moorcroft and they are a bunch of muppets.

i_am_really_rich!!

Hello there, I did have a credit card debt secured against my property a while ago. They have to apply to the court and you can contest it, but as I let it go through I don't know what the success rate is for this. Looking at your story it looks as though you have good grounds for not having the debt secured against the property. However this is not as bad as it sounds. As long as you keep up the payments, there will be nothing more that they can do (I think) and if you sell your house they take their cut 1st (this is what happened to us). Contact a solicitor or CAB for more advice on the legal position.

Xbigman

The term 'secured against the property' almost certainly refers to a charging order. In the case of a shared property they cannot force a sale via a charging order so this is largely an empty threat. I say largely because it is a hassle and worth avoiding if possible. Keep talking to them but do it in writing and send it recorded delivery. Do not offer to pay more than you already have.
Of paramount importance, don't miss any more payments. Send them a cheque for the missing payments. You have to view this from their perspective. They hear hundreds of reasons why payments are missed every week and they stopped listening because they can't tell who is genuine or not. That coupled with commision based salaries has made their reps unhelpfull. Just keep paying and tough it out.
Regards



X

beanielou

If at all poss you do not want a charging order against yoor property
Please go to your local CAB for help

Tootsie_Roll

Despondant

You mentioned the debt has been passed to 'a Legal Collections company', would that be Direct Legal & Collections ?

If it is then as you have been making payments previously they will almost certainly pursue this through the courts to achieve a 'forthwith judgement' and get a charging order on your home - this is their standard tactic and something they do all the time, certainly not an empty threat ! Another point is that all fees and costs will be added to the outstanding balance. On the plus side DLC nearly always give an undertaking to the court that they will not force the sale unless you subsequently miss agreed payments.

I'm not sure if you can avoid this course of action if they have already started it but I would certaibly follow Xbigman's advice and catch up all the missed payments immediately as he is correct that they hear this sort of excuse all the time. DLC by the way are not paid commission.

Despondent

Thanks to you all for all your advice.

Egg have passed my debt to DLC. If I pay the three missed payments do I send these to DLC or to Egg. DLC told me to cancel my standing order to Egg, which I have done, and not to make them any more payments.

I am not concerned about losing my home or having a charging order put on it but am concerned that it will affect my sister's credit rating. This is not her fault. Also my mortgage is due for reviewing in August. Will this affect my chance of getting a good rate.

As already stated I fully intend paying off my debts and can see no reason why I would default in the future so cannot see that the charging order would affect me.

Despondent

Just to let you know the final outcome.

When I got home from work yesterday I had a letter again asking for full payment or they would take the usual steps i.e. County Court Claim letter/a Collector calling/Debt Surveillance Agency. I telephoned DLC to ask if this meant they had refused my offer of £40. They said it wasn't enough and wanted 79.98 pm. My sister offered to pay the extra 39.98 pm for me and therefore I have agreed to this. At least it will be paid off quicker.

Once again thank you for all your help/siggestions.