increase in credit card interest - where do I stand?

mattwhite1

Not a normal increase, so bear with me.

I have had a card with Marbles for about 8 years now. About 6 years ago, I had a telephone conversation with them where I negotiated a better interest rate down from 14.9% - and 7.9% was given to me over the phone - for life the advisor said.

About 4 years back, Marbles sold up to HBOS - who upped my interest without warning to 17.9%.

I tried to argue at the time, but I couldnt afford to pay off the debt - was about 7k stupidly - and I wasnt given the option to pay the card off, or anything else.

Last year I lost my job, and stopped paying my debts while I look for work. On advice from another forum, I subject access requested from them all details relating to my account.

I have done this because I want evidence of the 7.9% being offered, and the information that they hold on upping my rate unilaterally. Also, they have pretty much failed to answer any complaint I have ever had. They have acknowledged receipt, but never get around to answering them - the last one due to not being able to access my statement info!!!

I reckon I have been paying at least £50 a month more than I agreed to all those years ago, and it amounts to about 3k.

Do i have a case in taking this to the ombudsman or to argue for a reduction in the balance?

Sorry for sounding thick, but I dont really know where I stand.

chattychappy

If what you say is true - 7.9% was for life, then life it should have been. So yes, you should be able to claim back excess interest charges and insist they continue to apply this rate. It's not totally simple - you would have to argue that somehow this verbal promise amounted to a change in T+Cs such that they couldn't change the rate again in the future. Afterall on this basis, this is what they later tried to do.

The normal route would be complaint in writing + letter to FOS if necessary.

The problem is evidence. CC companies just don't make these kinds of offers. There must have been a misunderstanding - either you misunderstood, the call centre OP didn't explain it properly, or the call centre OP themselves didn't understand what they could offer.

When they talk about "life of balance" deals, usually it's for balance transfers within a limited time, or perhaps your existing balance. Ie whilst the rate is "for life", the offer isn't for life. New transactions (perhaps after the promotion/offer expires) would attract standard rates. Also until this year, the general rule was that payments would go to the part of the balance with the lowest rate first.

So even when there is a promotional LOB rate, there is usually a standard rate for transactions that lie outside of the promotion. It seems this is what they raised.

It might well be that you did get the 7.9% and indeed might still be getting it on what is left of that original balance. But subsequent transactions would be at the higher rate.

You will have an uphill struggle establishing that the deal you were offered was something different from what is normally offered. If you have any contemporaneous notes - eg dates/people you spoke to - even if only handwritten scraps, then this is all evidence. If they cannot come up with any record of the content of the conversation, then maybe you have a chance.

mattwhite1

Thanks Chatty.

Obviously I dont recall the conversation verbatim, but I do swear that it was offered to me for the life of the card, or the life of the balance. Either way, as I had only ever paid the minimum, this was never reached.

I have SAR'd the, in the hope that there will be notes on my account, or an entry onto my file from around that time explaining it, or at least to show that it happened, and then again to show when the rate went up after the buyout.

As I see it, there will be some questions that need to be answered, and the burden of proof has to come to them as the record holders to prove that it was either time limited or a special offer, with an expiry date. Once I get my data back, I will be invoking DPA by requesting a copy or transcript of the call with the agent involved to see if I have been misled in any way.

I am not looking to avoid paying what I owe, but now I am in a position to fight back a little, I intend to leverage wherever I can.

As it stands, from a previous complaint I had before Xmas, they have written to me today with a holding letter and ombudsman contact information because they are unable to locate my statements to answer my question!!!!!

I am betting on the fact that they wont be able to provide any data circa 2005, and it then comes to my word against theirs.

mattwhite1

UPDATE:

Got my DPA details, pages and pages of statements - about 10 missing, including some around the time of my rate change.

NOTHING in my notes, or bundle to suggest I was given a better rate, or a time period, no letter, no written confirmation other than my statement showing the reduced rate, and then without warning or notification, increasing to 14.9% just over 3 years later.

I will be calling them tomorrow to discuss further, as there are not even notes to suggest a telephone call was made - so I will now be challenging them to prove to me that a) the rate was not for life, and b) that I was given no prior notification of a rate increase -both of which I believe are violations of the CCA (stand to be corrected here)

Anyone else got advice before I speak with them tomorrow? Any advice greatly received.

mattwhite1

UPDATE - This has now gone to the FOS.

Following further complaint to RBOS - they knocked off £600 for goodwill. THey then stated that they couldnt go any further as the debt was being managed by HFC, and that HFC advised them that they couldnt do more. The advisor at RBOS advised me that if it were RBOS's debt, that she could and would recalculate my debt to the agreed level.

FOS is collating info at the moment, so should hear in about 6 weeks.

Ultimately, they have failed to provide details of the conversation where this was agreed, they have failed to provide any written correspondence where this was discussed, they have failed to provide any 'right to reject' letters for the rate increases, and have failed to explain the drop in my interest rate at the agreed time.

Fingers Crossed.

LovelyLeeds

Unfortunately it's not a case that they've 'failed' - you didn't get the 'for life' agreement in writing so it will be difficult to prove. All you can do really is show the better interest rate they offered which will show on your statements and hope.

mattwhite1

Cant disagree - its a lot of hope.

My case stands on the fact that we had a conversation, where I was told that I have a rate for life. They have denied the conversation, I have proven that my rate was lowered there or thereabouts to this rate, and have challenged them to prove that it wasnt.

They have not been able to supply either a transcript, a copy of the call, or a letter that refutes my claims. The very fact that they stumped up £600 without much argument suggests that they know I am right.

Its hope, thats about all a lot of us have, but I will post the results up here to see what happens.

BeautyandtheBeast_3

good luck , i agree the fact they have knocked off £600 indicates they know they have done wrong. i hope you get it sorted in your favour! well done for getting this far!

mattwhite1

Quick update for any interested.

December 2010 - Balance of £6800
April 2010 - Balance of £6200 after HBoS credited me with £600 by way of apology
September - Balance of £5500 after FoS agreed that there had been a change of rate without notification, and HBoS now accepted that they could not prove one way or another.
October - Balance paid off as short settlement after agreement was reached with HBoS today (approx 55% discount)