Old Credit Card, Paid off, Not used for 5 years, Now Being Chased by Third Party. :(

i-CONICA

Hi,

I'm hoping someone can give me some advice.

I had a capital one credit card about 5 years ago, I maxed it out, and got into a bad habit of paying it off from my salary, then spending on it again because I had no money left in my bank.

Eventually I paid it off in full and cut the card up.

Now, I got a letter from a company who say they've bought the account, Hello. No mention of any money owed, so i just thought it was a letter sent to everyone on their books.

About a week later, I got another letter from them saying that they'd previously wrote to me introducing themselves, and are now seeking to settle the account. They're asking for about £750... :eek:

What on earth do I do? I don't have records going back that far showing I paid it off...

Any advice would be awesome.

Thanks.

Dabooka

Who is the company? Do they state in the letter it's a Capital One card?

i-CONICA

Hi,

Yes, they do. They say they're taking over capital one's old accounts, and recovering the amounts due on ones in the red.

izools

It sounds to me like you paid off the card in full, cut up the card, and thought that was that.

If this is the case, what has actually happened, is that "rolling interest" was on the following months bill - which you may not have received if you used online account servicing - and may not have checked if you though you didn't owe them anyting.

It sounds like this rolling interest has resulted in £12 charges each month for non payment, extra interest, and ultimately, a Default against your name for not bringing the account back up to date.

The other possible cause is a Recurring Payment Authorisation against the card - you may have had a subscription - annual or monthly - set up to take the money from the card, might be insurance, or whatever. If this is the case, closing the account and cancelling the card DOESN'T stop the authorisation for said subscription to be taken from the card - this can only be cancelled by the company you authorised to use the card, not Cap One.

You might have moved in the last five years? But not updated Capital One? So didn't receive their mail and only got this letter recently because the debt collection agency ran a "trace" search on your credit file and saw where you're currently registered to vote.

I suggest checking your credit file with Exierian and / or Equifax to see if there is a Capital One account on there, what the balance is, and whether it defaulted.

If it did default, you will have damaged your credit worthiness, and you do indeed owe whatever balance is stated on your credit file.

If you don't see a capital one account on your credit file, or you do but it's marked as up to date and settled with a £NIL balance, tell the company chasing you to do one until they can substantiate their claim.

i-CONICA

Oh, crap.

So if what you're saying is actually what's happened, because yes, I did "paid off the card in full, cut up the card, and thought that was that", is there anything I can do to get out of this? Or am I ultimately going to have to pay it?

Thanks.

izools

Well you could pay it, you could ignore it. You can't "get out of it" because it is a totally legal debt - they were acting within their own T&C you agreed to when charging you trailing interest and fees for non payment.

You might be able to offer the DCA a "full and final" settlement figure of less than the £750 but don't pay them a penny until the full and final figure is confirmed in writing if they agree to a reduced sum.

The account will have already defaulted if it is now with a debt collection agency. The benefit of paying it off is helping your credit worthiness a little - a satisfied default is better than a default that hasn't been paid.

However once you've paid it off, the default will still show on your credit file for six years from the date it was registered and affect your ability to get credit somewhat.

Shouldn't get in the way of the likes of mobile phone contracts and utility accounts as long as you don't have other nasties on your credit files but might prevent you getting 0% cards for a while yet.

Best bet is to get a copy of your credit file from Experian / Equifax to see how things look as a first port of call.

Good luck! :beer:

i-CONICA

Thanks, izools.

It's £6 I think for my cred report from experian, I'll get that and see what it says...

Thanks again.

izools

i-CONICA wrote: »

Thanks, izools.

It's £6 I think for my cred report from experian, I'll get that and see what it says...

Thanks again.

£2

http://www.experian.co.uk/consumer/statutory-report.html

Evilm

1. Check your credit report ( I see you are already doing that)
2. Check with Capital one - it wouldn't be the first time the data given to/used by a collections agency isn't correct. If Cap1 say that account was settled in full then get them to put that in writing and send to the debt collector.
3. Write to the debt collector and ask them to PROVE the debt. They can't just say "this is your balance, we have no account history" They have to provide the supporting details and that means 6 years worth of history at least.
4. If it is valid and they can prove it then see if they will accept a Full and Final Settlement. Ensure this is put into writing and the confirmation says "in full and final settlement" and the figure. (otherwise they could come back afterwards and say "we don't agree, you owe us the rest. I have actually seen that done where they just wrote "we will accept your payment of X" and no mention of Full and Final was made).

Side point: I notice your signature mentions Bankruptcy. If you have been Bankrupt less than 5 years ago (eg. after you thought you'd cleared this card) then I would look at if that makes the debt invalid now anyway. I don't know enough about the process but its possible?