Are Payday Loan Charges claimable

dunstonh

Their response suggests nothing at all, they are not a court.

Correct. They are not a court. They are slightly more consumer biased than a court will be in that they will follow a similar methodology to the courts but will also include fairness, unlike the courts. The awards made by the FOS are legally binding on the firm. There is also no appeals process unlike a court.

Do you think a £25 charge for late payment is perfectly lawful? If so, why?

Lawful or fair? I actually think that it could be fair in the right circumstances. High risk lending has to cover the cost of the defaulters more. Personally, I think £25 is steep for a late payment but there has to be some fee in place. As for lawful, I will leave that to the courts but there hasnt been much success in proving them to be unlawful so far.

Smasher

dunstonh wrote: »

Lawful or fair? I actually think that it could be fair in the right circumstances. High risk lending has to cover the cost of the defaulters more. Personally, I think £25 is steep for a late payment but there has to be some fee in place.

I meant lawful, since you seem to think the FOS were suggesting there would be "no case to answer".

dunstonh wrote: »

As for lawful, I will leave that to the courts but there hasnt been much success in proving them to be unlawful so far.

And why do you think that might be? There have been tens, possibly hundreds of thousands of court claims challenging the lawfulness of late payment fees in recent years. You think it makes better financial sense for a credit firm to shell out millions in settlements rather than step into court in the first instance, prove they are correct and put a stop to it? Its not like they're trying to avoid the publicity of it now..

natweststaffmember

dunstonh wrote: »

Correct. They are not a court. They are slightly more consumer biased than a court will be in that they will follow a similar methodology to the courts but will also include fairness, unlike the courts. The awards made by the FOS are legally binding on the firm. There is also no appeals process unlike a court.



Lawful or fair? I actually think that it could be fair in the right circumstances. High risk lending has to cover the cost of the defaulters more. Personally, I think £25 is steep for a late payment but there has to be some fee in place. As for lawful, I will leave that to the courts but there hasnt been much success in proving them to be unlawful so far.

The £25.00 especially as it has been added to the loan could be suggested that it is additional loan facility since the repayment is increased as a result of the charge. I think UTCCR 1999 would class that as a significant imbalance in the contract contrary to good faith and therefore reclaimable.

Premier_2

Smasher wrote: »

...And why do you think that might be? There have been tens, possibly hundreds of thousands of court claims challenging the lawfulness of late payment fees in recent years. You think it makes better financial sense for a credit firm to shell out millions in settlements rather than step into court in the first instance, prove they are correct and put a stop to it? Its not like they're trying to avoid the publicity of it now..

A company cannot go to court to prove what they are doing is lawful.

They require someone to take them to court and contest that what they are doing is unlawful and on what grounds.

In an attempt to stop the ongoing arguments, the banks asked the OFT to do just that, and on the grounds the OFT used, the Supreme Court found in favour of the banks.

Of course that doesn't stop people then saying the grounds used were not the right ones.
Hindsight - the perfect science!

Mind you, the OFT couldn't justify going to court again as they thought they'd probably lose again if they did.

But there's nothing to stop you trying ... if you've deep enough pockets :cool:

natweststaffmember

Premier wrote: »

A company cannot go to court to prove what they are doing is lawful.

They require someone to take them to court and contest that what they are doing is unlawful and on what grounds.

In an attempt to stop the ongoing arguments, the banks asked the OFT to do just that, and on the grounds the OFT used, the Supreme Court found in favour of the banks.

Of course that doesn't stop people then saying the grounds used were not the right ones.
Hindsight - the perfect science!

Mind you, the OFT couldn't justify going to court again as they thought they'd probably lose again if they did.

But there's nothing to stop you trying ... if you've deep enough pockets :cool:

Premier, the banks did not go to court over Loan charges or Credit Card charges or Business account charges so I think you may have confused this thread for a bank charges one.

Smasher

Premier wrote: »

A company cannot go to court to prove what they are doing is lawful.
They require someone to take them to court and contest that what they are doing is unlawful and on what grounds.

Correct, as thousands of people did and continue to do. It might be an idea to go & have a look and see what you're arguing about..