Ignoring an unsecured due loan

wynnvegas

Morning Folks,

My mum (stupidly) guaranteed a distance learnng course that my brother (stupidly) signed up to with Advent training to become an IT Engineer. The loan is now due and, partly due to my brother doing pretty much zilch over the last twelve months and Advent going bust in January of this year, there is nothing to show for the money that is now owing.

The loan, however, is unsecured. She has no other debts. I imagine that by changing her phone number and denying access to any debt collectors that threaten to turn up or actually turn up (not that there's all that much worth taking) that there's not a great deal they can do other than destroy her credit rating (not all that much of a big deal for her). Is this right or is there something I'm missing? Could they potentially arrest her wages? She lives in Scotland if that makes any difference.

For the record, my advice to her was to challenge it all the way using the Financial Ombudsman (proved to be a royal waste of time) and the no win no fee lawyer service that is currently ongoing against Barclays Partner Finance who provided the funding. I imagine her best bet (if not just ignoring the issue) is to take out a loan and demand that my brother (who is still unemployed after two years and shows no interest in getting a job anytime soon - thus why I refuse to help them financially) pays the lot including interest.

Please let me know if this belongs on another board.

Cheers,

Billy

MyLastFiver

If the loan is due and payable then the creditor can get a County Court Judgement to make your Mum pay up.

If the company provided the course then I would imagine the debt is payable, whether your brother did any work towards it or not. Not sure what your case would be to the Ombudsman in these circumstances. Probably best to arrange payment in instalments to BPF and try to get your brother to pay them.

However if the company went bust and the course was not provided, then that is another matter.

RAS

I think there has been some adverse publicity recently about barclays partner Finance and loans for other courses, that did not even qualify the people training to work in Scotland. Try googling it.

Annisele

There is definitely potential for them to do more than just shred her credit rating.

If the creditor decided to sue your mother, it could obtain a CCJ against her in England or a decree in Scotland (I'm not sure whether the action would take place in England or Scotland in those circumstances).

Shelter gives a list of things creditors can do if a decree isn't paid here. And yes, arresting her wages is one of the things they can do.

Why was the FOS a waste of time? What did they say?

RAS

hi

HAs she contacted Trading Standards?

wynnvegas

Thanks for the replies. The company went bust (not that he'd done any work towards the course) 6 months after he took the loan out and convinced my mum to guarantee it. I did advise him at the time not to go with the company as their claims to guarantee employment were well beyond what I thought to be reasonable. The ombudsman agreed that there was a strong element of mis-selling and a failure to supply the services advertised but they wriggled out on a technicality; namely that the service wasn't provided to my mum so she had no right to claim on the basis of the failure to provide and that the finance was not taken out by my brother so he couldn't claim for the mis-selling aspect. It seems as though the guarantor option (only taken as he was guaranteed a job within the first six months assuming a pass on the course) was the worst of all worlds for them.

Mylastfiver - I think your idea of arranging for payment and getting my brother to pay it (assuming he can be bothered getting off his a**e, that is) is probably for the best. There is a clause in the terms and conditions that if full payment isn't made to the calendar year after the loan is taken out (01/07/2010) then the course fee of £5,500 doubles overnight. There's a wee bit of me that thinks anyone stupid enough to sign up to that kind of deal deserves everything they get but desperate people who are promised the pot of gold at the end of the rainbow will, it seems, swallow any old story in the hope of getting an easy ride.

Cheers,

Billy

wynnvegas

Hi RAS,

Trading standards seemed a bit confused in the first instance as they didn't see how anything could be claimed or proven against a company that now doesn't exist. s.75 of the Consumer Credit Act seems to put Barclays Partner Finance in the frame as a linked creditor and, on that basis, my argument would be that the promises made were complete fiction to begin with and it was those that convinced both my brother to sign up and my mum to guarantee the loan. I did get the Advent salesman round to my house to see if the promise was as blatant as they had described as I had my doubts about their story but, true enough, he confirmed it was a full-time, permanent job in a big IT company starting at £18,000 per annum and not just CV assistant or agency introductions. Barclays Partner Finance are going on the basis that there is no written documentation proffering such a guarantee but I believe that a verbal guarantee in these circumstances is binding in Scots law and that the burden of proof would be difficult for Barclays to argue against seeing as there had to be some reason for the 6,000 or so people who bought their training from Advent paying double the going rate in comparison to companies like Serco and Computeach.

Cheers,

Billy

Trollfever

I have heard of a similar story about Barclays Partner Finance.

Not sure what happened in the end but their was a breach of the OFT guidelines on responsible lending.

http://www.oft.gov.uk/news-and-updates/press/2010/35-10

MyLastFiver

wynnvegas wrote: »

There is a clause in the terms and conditions that if full payment isn't made to the calendar year after the loan is taken out (01/07/2010) then the course fee of £5,500 doubles overnight.

:eek: I thought we were talking a few hundred quid here, not £11000.

Talk to a good solicitor. Your no win no fee people may not be the best.