Admin Error from MBNA cost me mortgage

amat_endura

Hi All,

I'm looking for some advice regarding recent treatment by MBNA (from and old Virgin credit card). Here is the basic story:

I recently applied for a mortgage and ran credit checks with both Experian and Equifax. All came back fine but we were declined the mortgage with the Newbury Building Society for a bad debt. All we could see on the reports was one late payment to a Barclaycard, so we were upset especially as the only other mortgage we could get (for a shared ownership) was with the Nationwide and required an extra 5% deposit. We managed to get this money as a family loan, and despite the Nationwide also noticing this bad debt, we got the mortgage.

Here is where it starts to get "interesting". To cut a long story short, I had a Virgin card between 2003 and 2004, and then closed it. Then in 2007 someone managed to charge £8 to this card. The statements were sent to an old address so I never received them, so the debt went into default. It was only when I got Experian to re run my credit report on the old address up to 2008 that we even saw the problem. As I originally thought that I had been a victim of identity theft I asked the fraud dept of MBNA to investigate, and this is where all the details came out.

I got MBNA to put their findings in writing, and they did. They also included a £25 courtesy payment. As we almost lost the house we wanted, put our in-laws in strife by borrowing the extra deposit and have a more expensive mortgage, we want to go for alot more compensation, especially as they have technically libelled me in calling me a bad debt risk. Does anyone have any experience or advice for how we go about doing this?

Many thanks,
Paul.

noh

So what did MBNA do wrong?

amat_endura

You mean apart from allowing money to be charged to a closed account?

Not contacting me about it despite my mobile number and email address being constant, allowing me to open both a new Virgin card and a Sony card, offering £25 for a mistake that they made which nearly cost us a house, ruining my credit report..........

ampafc

But you've got your house now, right?

My advice would be simply to move on, and put this behind you. Stop trying to get more money out of them.

withnell

Have you banked the cheque - if so this is you accepting the payment as compensation, so you're going to find it a lot harder to get any more

Can you give some more details about the payment charged in 2007? Was it made under a CCA?

noh

amat_endura wrote: »

You mean apart from allowing money to be charged to a closed account?

Not contacting me about it despite my mobile number and email address being constant, allowing me to open both a new Virgin card and a Sony card, offering £25 for a mistake that they made which nearly cost us a house, ruining my credit report..........

Money can and is charged to closed accounts if a continuous payment authourity has been set up.
Was it a payment you had authourised at any time?

chattychappy

withnell wrote: »

Have you banked the cheque - if so this is you accepting the payment as compensation

Why? Not if they merely offered it as a courtesy payment and it was accepted on that basis. Different matter if it was negotiated as a settlement of the dispute and the OP agreed to give up any claim.

It does seem the OP has suffered a real, quantifiable loss as a result of all this. Perhaps this could have been mitigated at the time - ie when Newbury gave the reason perhaps it could have been fixed at that time? It does seem MBNA acted reasonably in sorting the matter. If in the meantime the OP couldn't wait and paid more elsewhere, I don't think the difference can be reclaimed. If on the other hand there was a lot of fudging around (ie unreasonable behaviour) which forced the OP to go elsewhere and pay more then I think there could be a claim. If Newbury "threw a wobbly" and wouldn't touch the OP again despite the truth becoming clear, I don't think MBNA can be held liable for that.

noh

wrangler5 wrote: »

Continuous would be monthly or yearly, not 3 years after the account was closed.

Not necessarily.
Could be anytime.
The AA did it to me.
I bought a new car with 3 years manufacturers breakdown cover. I called the AA to tell them I no longer required cover from them and they suggested I suspend my AA cover for the period of the manufacturers warranty.
3 years later a payment was charged to my by then closed credit card.

amat_endura

Ok, a few points:

1) There were no payments set up on the card, as it was used for balance transfers only
2) Regardless, it should not be possible to charge a closed card surely?
3) It is not just a case of us getting a mortgage from a different provider and all's well that ends well

We have ended up with more debt and a more expensive mortgage purely due to poor practice and systems at MBNA. They have admitted this. The £25 has been credited to my current Virgin card and will not be spent as I am aware that this may construe acceptance of compensation.

We don't want a huge payout, but do feel very agreived that this has cost us thousands and should not have been possible to happen. We just wanted to hear from the forum from any people who may have been treated in the same way, who they complained to and how they dealt with it.

We also feel that this kind of behaviour needs to be made public so that word spreads. Who knows - eventually the banks/ card providers may one day actually change for the better.

For_Keeps

Do you have legal cover on your insurance? if so I would use them

cifpower

Are you definitely sure the account was closed? Is it marked as "settled" on your credit file?