Bank Agrees to payback PPI but a Debt Collection Agency Now owns loan i defaulted on

Vinny_Powell

HSBC say they will pay back the £3500 for PPI. The problem is i defaulted on the loan of £10,000 and they sold this to a debt collection agency. Therefore do HSBC have to pay me the money? ...or can they give that £3500 to the debt collection agency to subtract off of the debt?? Please somebody help me

magpiecottage

It will depend on what their terms and conditions say.

If it allows them to recover costs and losses incurred as a result of your default (which it probably does) then they will almost be able to.

I do not think that is in any way unreasonable. You agreed to pay them in exchange for your loan but you did not do so. That is hardly fair of you.

As a result, they have suffered a loss of anything up to £10,000 plus the interest you agreed to pay plus any costs involved in unsuccessfully pursuing you for it. In the end they have decided to mitigate (minimise) the loss by selling it on to a third party. That does not change the fact that you have caused them a loss.

They have now found that they did not treat you fairly in selling you the PPI and as a result you have suffered a loss valued at £3,500.

So if they choose to set this amount against the loss you have caused them that sounds perfectly fair to me.

McKneff

I agree with magpiecottage I'm afraid,

At least you will lessen the debt, thats got to be a positive.

nlw_2

A similar thing happened to my dad, although it wasn't a huge amount. He contacted his bank for the PPI Claim, he's been given the full amount of £1,800 back in ppi charges, and they have also wiped the £1,300 still owing to the debt collection agency (which didn't include any of the PPI refund). I don't know why they have wiped it. But in his original claim letter it did state that if any monies were owed to the agency then it would be paid directly to them, so he wasn't expecting all of it. I'm not saying this will happen to you as your's is a very large amount, but you never know as my dad certainly wasn't expecting it.

dunstonh

In most cases, where there is a default, arrears or an amount written off, then the money goes towards those first.

Logically, that is fair as you technically never paid the PPI. So, therefore you shouldnt get any refund.

Derwent

It all depends on the legal status of the debt.

If the DCA is acting as an agent for the lender then the lender is quite entitled to pay the refund directly to the DCA.

However, many debts are bought by DCA's under a legal deed of assignment and once that happens the DCA owns the debt and the original lender has no legal rights on the debt.

If a deed of assignment was issued then the lender can not refuse to refund the customer directly as the debt is now a matter between the customer and a third party. Its no different to them not being able to pay it to your energy supplier because you owe money on your gas bill. Once a deed of assignment is issued it is no longer anything at all to do with them.

So the basic advice is to ascertain whether the debt was transferred under deed of assignment, if it was then you can demand the money be repaid directly to you.

dunstonh

If a deed of assignment was issued then the lender can not refuse to refund the customer directly as the debt is now a matter between the customer and a third party. Its no different to them not being able to pay it to your energy supplier because you owe money on your gas bill. Once a deed of assignment is issued it is no longer anything at all to do with them.

Back in my banking days, any debt referred to a collection agency had agreement that any money that the bank received later should be passed to the collection agency. I would presume that is fairly typical across the board.

Derwent

dunstonh wrote: »

Back in my banking days, any debt referred to a collection agency had agreement that any money that the bank received later should be passed to the collection agency. I would presume that is fairly typical across the board.

It doesn't matter what informal arrangements exists between bank and DCA, if a deed of assignment is issued then the legal status of the debt is that it is a matter solely between DCA and debtor. The bank has no legal right to intervene and you can sue them for it. As I said, the fact that you owe a DCA is no more concern of the banks than if you owe the gas supplier, the telephone company or Sky television. It is legally nothing to do with them and they can not divert your money to a third party without your permission.

smitchy73

I have a similar position with RBS, although the DCA is acting on behalf of RBS(Capquest), I have been paying back the money I owe for over 8 years now, I have been told by RBS account handlers(Credit Management Services) that the PPI and it's interest will be removed from what is outstanding of the original loan, and what is left I can either restructure to a new loan OR I can ask for a settlement figure from them which is usually 60% and pay them that to settle the debt.
The redress they say will be sent to me, this was all from the CMS of the bank, the PPI team could only tell me that the amount my loan payments should've been without ppi, but then again if the ones handling the ppi complaints are outside contractors then it's no surprise they can't tell most of us anything they probably don't get the same access to the account.

oshb5

Hello Derwent

Id just like your opinion on my PPI claim. First of all I used a PPI managment company which I know I should have not done. But now that’s to late. 

Anyway NatWest who the original loan was with for approx 5k

A bit of background on the original debt and how and why it was so large and why I stopped paying the original debt to Nat West Right well me and my wife had been having problems and ended in a horrendous argument that was at dinner time. She said she wanted the car so she had to drop me off at work. Some people say she drove the car towards me but I cannot say I saw it but she put her foot full on the accelerator and drove it full power into our works car park. All I can remember seeing was a long line of cars all concerting in to a line of wrote off and damaged cars. I was only young so did a runner. And went and stayed with a friend.  I was getting calls from every angle and I was in such a state. My wife was ok but my car plus. 6 more where heavily damaged also mine and 2 others of the 6 where written off.  So you can imagine the mess As for the 6k I know owed the bank which was made up of 3k loan balance also another top up loan that was still in my account and the 1k overdraft facility we had. Has I had a very good job back then earning around 700-900 pond a week but it meant quite a lot of extra hours and working away so the wife did everything she sorted the money signed the checks and everything else. Also the reason we had to have loans when having such a good job was things had hit quite rock bottom she was spending more than I worked for. And I was unaware as she did it all using Peter to paul and so on all in my name. It was not till we had my car pinched and the insurance got out of paying that I found out as I needed a new car and there was no money for one. Hence things started to deteriorate and ended up in the massive final row and car crash After the crash and over the next week the ex Got as much as she could and this was by emptying all the money left in the bank account and the full amount of the overdraft all the time I was just in a daze.  I cannot prove who had what or when as back then security was so lax and people could get away with anything. The final straw I’d by her doing what she did and me doing the runner I’d bought the company into disrepute or something like that and we had branches all round the UK and it went round them like wildfire. I was called in and asked to take in my union rep. And If it had just been for the being absent without leave. . I would have had a suspension period without pay. But for the other part of the. Accident and disrepute I was Asked to resign. They said if I did not they would sack me and that I could fight it but as well as all the other things all those in my team where the owners of the cars she had written off or damaged. They had been interviewed and they had all said they no longer wanted to work with me. And as such put me out of a job as there was no other I could as it was so niche. Then when I tried to find out what my wife had told them whilst she was in the building after she got out of our smash car. No one would tell me when I asked and even in thee street if I saw any of them none wanted to stand and chat.  So I can only assume it was something that made me look very bad.

sorry for explaining one of the worst events in my life. But it is that event that started all the problems. As I’d signed to say I’d resigned I could not sign on for so long I’m not sure now it was so long ago now. So I had no money coming in at all so I’d defaulted on that one as well as. A coupe of others plus’s phone and services bills. So was getting myself in a right mess. In the and Nat West put the account and loan together as one and they kept ringing and sending letters the e same as other CC companies and the gas and electric companies. But I just buried my head in the sand And it was quite a few months before I started to accept things and by this time I’d had a heart attack. Also as it had taken me quite bad I was on benefits for being on the sick. But in the mean time I had made offers of what I could afford now I was looking for work which was not much with how much I used to get and giving my friend half of everything bills an all I’d got hardly anything left. But that was pre heart attack. I was then told I’d have to have a triple heart bypass as the veins a soo badly blocked. But they said. I’d be a new man after the op. However it took nearly 4 years before I had the op due to emergencies and me getting infections and such the day before the op. In all it took 5 attempts before it finally got done. But typically with me there had to be issues didn’t there. And it did not go as planed and I did not get any better e as they said I was about the same but over the years gotten worse. And these. Last 3 years significantly worse and know know I won’t work again. It’s only downhill from here on out.  

I’d never wanted to do a PPI chain thing but I’d had that many day after day calls and tv. Ads and letters so. In the last 2 months I decided too just try not expecting anything at all cos I was one of these that would not let them any extra Tatar’s on any billl loan CC or appliance where it be the extra warranty or delivery. Back in. The day when I could do it.. So like I said I did not expect any. But I did and is the Nat West/RBS. And there is still 4K outstanding on the debt for loan/current account for which I’m still paying monthly for 
and they have said there is approx £2900 in total to come back. But  have said there is about £480 that they have sent to the tax man and the balance has to go through checking and final payment center checks. This is where I’m in bother again because if they use all the £2200 and take it off the the outstanding which was to be I suppose. But has left me with a £600 plus payment I need to pay to th3 PPI Company. And I have no idea how I’m going to pay that. Iv managed to pay most of the old dents from my previous marriage off Iv just got 3 no one around £68 1 @ £700 and the Nat West @ around 4K now.  I am still ill very ill now with a long list of health issues and a monthly medication list of 15 regular monthly items and another 4 that are around every 3 months  with 1being a GTN Spray for angina and 1for my incontinence pads I wear all day and night.  

NOW and finally 

We get to the reason Iv written to you..

You could If you wanted ignor all the rest of their excessively long and boring message. However it might bring a smile to some of you sadists out there. But has been painful to write. But once I got started I was on a roll and as writing on a laptop is about one of the last things I can still do and enjoy without me getting out of breath or getting loads of pain. ( until I try and get up afterwards that is?) So let’s not start again and write for England lol. 

Anyway everything said and done or not done I was written to in October’s at that my liability to the bank well soon be in the hands of another company and nothing will change. The start of this change started in September. And they will be in touch again when it is all finalised.  I had forgot about all this till I started looking for some other paperwork from last year and I came across a letter dated December saying the selling of the debt to XXXXX is final and all payments wether monthly or if you want to pay a lump sum or make a final payment off please send all questions and enquiries to XXX As they are now the legal owners of the debt.  

So could I ask in this case can you or anyone suggest what might happen.  And if it is as I fear may well happen.  If so could anyone suggest a easy way of explaining to the PPI Claims company what has happened and why but more than all that I cannot afford to pay them back , well not all at once  but monthly and only then at a low amount?

Thank you for putting up with my splurge of words with  far to many I know but.

Thank you regards Osh

P.S. To the mods. Remove if you think it’s far to long. I ask because I did not realise till I went back and reread it all Opps sorry

[Deleted User]

Contact whoever it is you owe money to and make a payment arrangement.

Don't tell them your life story.