Financial Hardship & a closed bank account due to DMP

Crystaltipps_2

Hi

I have been trying to claim my bank charges from HSBC for a number of years. I was going through the court route until it was put on hold and then the ruling came, so HSBC wrote to say they were closing my complaint.

I have been maintaining a DMP for 3 years via CCCS, so with the ruling I have tried a different approach, by claiming financial hardship. I enclosed my CCCS Income and Expenditure and list of current debts. I have a credit card and bank account debt with HSBC. The bank account was the one which generated all of the charges, approx £600 with no interest. The bank account was closed when I went onto the DMP and currently only has £120 debt remaining. (there is about £3k on the credit card and about £35k total on the DMP).

HSBC have responded to the financial hardship claim by saying " I note that your account was closed on 3 May 2007. On the basis that there is therefore no longer an active banking relationship, we are unable to undertake a review of your financial situation to determine the extent of your difficulties....This letter constitutes our final response..."

Are they correct in saying that they cannot consider my financial situation? I plan to take this now to the Ombudsman, but wanted to make sure I still had a case.

Thanks in advance for any advice.

natweststaffmember

Crystaltipps wrote: »

Hi

I have been trying to claim my bank charges from HSBC for a number of years. I was going through the court route until it was put on hold and then the ruling came, so HSBC wrote to say they were closing my complaint.

I have been maintaining a DMP for 3 years via CCCS, so with the ruling I have tried a different approach, by claiming financial hardship. I enclosed my CCCS Income and Expenditure and list of current debts. I have a credit card and bank account debt with HSBC. The bank account was the one which generated all of the charges, approx £600 with no interest. The bank account was closed when I went onto the DMP and currently only has £120 debt remaining. (there is about £3k on the credit card and about £35k total on the DMP).

HSBC have responded to the financial hardship claim by saying " I note that your account was closed on 3 May 2007. On the basis that there is therefore no longer an active banking relationship, we are unable to undertake a review of your financial situation to determine the extent of your difficulties....This letter constitutes our final response..."

Are they correct in saying that they cannot consider my financial situation? I plan to take this now to the Ombudsman, but wanted to make sure I still had a case.

Thanks in advance for any advice.

A couple of questions really, with regards to the credit cards/store cards/catalogues within the DMP, have you reclaimed the charges on them yet?
With regards to financial hardship, I cannot see how the closed account can make your financial situation worse. Do you have priority debt arrears(mortgage/rent, council tax, utilities)?

Crystaltipps_2

Thanks for the reply.

There was only one card that had a couple of charges (Lloyds), I claimed that back a few years ago. I also have a claim for PPI on one credit card with the Ombudsman.

No - I don't have any "priority" debt arrears. I used the credit cards to withdraw cash to pay them, hence running up such large balances on the cards. The debt spiralled to over £60k, but I kept up with my priority debts at all times. Very warped logic looking back.

What I am confused about is HSBC's statement that they cannot consider me for Financial Hardship because I no longer have an open account with them. Surely this is the case with a lot of people, and when people go onto a DMP for any debt, the account (credit card, bank account) is often closed.

I would have thought that being in a DMP would indicate by default that I am in Financial Hardship - HSBC seem to view it the other way around?

natweststaffmember

Crystaltipps wrote: »

Thanks for the reply.

There was only one card that had a couple of charges (Lloyds), I claimed that back a few years ago. I also have a claim for PPI on one credit card with the Ombudsman.

No - I don't have any "priority" debt arrears. I used the credit cards to withdraw cash to pay them, hence running up such large balances on the cards. The debt spiralled to over £60k, but I kept up with my priority debts at all times. Very warped logic looking back.

What I am confused about is HSBC's statement that they cannot consider me for Financial Hardship because I no longer have an open account with them. Surely this is the case with a lot of people, and when people go onto a DMP for any debt, the account (credit card, bank account) is often closed.

I would have thought that being in a DMP would indicate by default that I am in Financial Hardship - HSBC seem to view it the other way around?

If you read the lending code on my signature, you will see that it may not be the case. In the DMP you are paying an amount that is now affordable and with reference to parts 167-172 which relates to assessment of that hardship you will notice that hardship is indeed something that is looked specifically. Being in a DMP does not automatically mean that you are in financial hardship. BTW, I would not have taken cash on the credit card but paid over the phone for priority creiditors.

Crystaltipps_2

Thanks for your advice.

I totally agree that using the cards for cash was a very foollish thing to do.