Lloyds TSB have transferred my account to Consumer Debt Recovery with no warning

kj999

Hi ,

I am a very worried person right now!
I have a bank account with Lloyds TSB that i rarely use (is not my main account). I have an overdraft limit of £1000 but for the past 6 months have been steadily going beyond this (due to fees etc) any my account now stands at £1118 overdrawn.

I got a letter from SCM solicitors acting on behalf of Lloyds TSB on 2nd April, saying I have 14 days from receipt of letter to pay £118 to get my account back in order, or I would be facing legal action.

I have called them today (9 days after receiving the letter) to pay them £118 only to be told they have transferred my account to "Consumer Debt Recovery" and that it is too late for me to pay them!!!

I have 2 queries:

1) What is "Consumer Debt Recovery" and what are they likely to do to me?!

2) Do i have a legal challenge here? They told me I had 14 days to act yet theyve transferred my account on after just 9 days - this is unfair?

any help or advice would be much appreciated!

BigCraigJohn

I would imagine its just there debt recovery department.
Could you just go into branch and pay in the cash to bring it back under the limit?, this way you have a stamped receipt that says you have paid the amount they asked for.

peteuk

Dont Panic - as it says on the back of the hitchhikers guide to the galaxy....im not money expert however both my wife and I have been through the situation you are in, so I will share my experience and hopefully be of assistance.

Firstly both of our accounts are loans, however we were with LLoyds TSB collections for a long time (4 years) I managed to kick up a fuss when I was instructed that the loans would be passed to Consumer Debt Recovery (CDR) about three weeks before I left the country. LTSB agreed to suspend any actions for 6 months however it took nearly a year to get it sorrted.

SCM - are the lawers who deal with debts for LTSB.
CDR is an in house debt recovery unit, who have been more than helpfull with us.

SCM were a little heavy handed, and managed to get a few details wrong, however once they realised we had been on a DMP and paying for the last 4 years they backed off. Equally when they tried the if you dont pay us we will send it to CDR and it will affect your credit rating, I said Please do cause you wont be charging me interest....they werent expecting that answer.

CDR were more than helpfull and again saw that the DPM was working, so accepted a payment plan straight away.

So okay slightly different from your situation, but (and some people may disagree with me) but they want your money. So my advice is to speak to CDR when they contact you, discuss your finances openly and press to them that you want to pay them, however it has to be something you can afford.

Yes it will effect your credit rating for the next six years, but at least it will be sorted.

Good luck

PS didnt they send it to collections first, they are usually good at sorting out a payment plan.

Tixy

Is the letter headed up as a default notice? or similar wording?
What was the date on the letter?

If its a default notice then paying within the timescale they set should mean default is not registered on your credit file.

As said above I would expect this consumer debt recovery just to be their internal collections department. Maybe you could phone back lloyds and ask for a number for consumer debt recover so you can make your payment.

kj999

thanks for the advice guys.

The letter was headed in block capitals "THIS IS A FORMAL DEMAND PRIOR TO THE COMMENCEMENT OF LEGAL PROCEEDINGS AND YOU ARE STRONGLY URGED TO MAKE IMMEDIATE PAYMENT TO AVOID LEGAL ACTION".

When i called them today, debit card in hand, to pay the £118 that would have brought my account back into order, they said that if i'd have phoned them yesterday before my account had been transferred to Consumer Debt Recovery, i could have paid the £118 and that would have been all sorted.

i find it ridiculous that because THEY have transferred my account 5 days earlier then they said they would in the letter, I am now going to have legal action taken against me.

The letter told me to contact them within 14 days to pay £118.
I have contacted them within 9 days to attempt to pay £118.
They have told me it is too late.

I think they have acted unlawfully, and now my credit file will show a default and they are likely to demand the whole £1118 back. This is totally unfair!

BigCraigJohn

Its just formalities and unfortunately its a 1 size fits all model.
I had agreed with LTSB to freeze my overdraft for a year, they agreed there would be no further contact in the year and they would not take any action. 3 days later a letter from SCM giving 14 days to pay the overdraft off or legal action would be taken. I rang SCM(dont do this as a rule, but in this situation it was a low balance + I had the name and time of the call with LTSB), bloke apologised and said it was just a formality and that is automated. If I could be bothered i'd be complaining about the tone of the letter but tbh cant be bothered.

Incidentally no default.

Like I said if you have the £118, go and force it into your account, get proof that you have done so in way of a stamped, dated receipt and carry on. If they have taken any action then you have evidence that you did everything they asked and therefore could dispute anything further.

kj999

cheers BigCraigJohn.

I'll go to my branch tomorrow and pay the money in, and then await what happens.

MME_2

If the account is with CDR then it has more than likely defaulted and the account closed. They will now freeze interest and charges and 'recover' the debt from you.