Do I legally owe anyone anything?

OddBob_2

Hi all,

Newbie poster here :wave:

I've been pointed in this direction by a recommendation in another forum in the hope that you guys and girls could give me some advice.

In Spring 2003 I purchased a TV, the bulk of the value of which was on the store's finance scheme. This scheme allowed me to pay the balance after 6 months interest free or pay a nominal sum after the 6 months for a further 53 months in order to clear the debt, though I would end up paying the best part of double the financed amount if I had done so. I intended on clearing it in full after 6 months but my circumstances had changed and I started to pay monthly which I did for 18 months straight, after which I called the finance company and asked for a settlement fee. They gave me a figure, I paid up and I cleared my debt 2 years after I took the finance out.

Over three years later, in the Summer of 2008, I get a letter from a "debt purchasing" company saying that I still owed money on the account, I tell them to jog on but they're quite insistant. They say that the last payment on the account was in Spring 2005 (which would be correct as that's when I settled it all) and that I defaulted in the Spring of 2008, the date they gave was the date that I would have made my last monthy payment had I still been on it, which I quite clearly wasn't. I called up the original finance company and asked them what was going on, they said that they couldn't help me and that the matter was now in the hands of this debt purchasing company...

I'll say now that while I can prove *all* my payments, I have nothing on paper from the original finance company to say that my debt was cleared... but neither did they contact me in any way between the day I paid my debt off and the date that I would have made my final monthly payment, which is over a 3 year period!

After a couple of phone calls this second company started to leave me alone, no letters or phone calls at all. Then, a year or so ago, it started again - letters stating that I still owe a sum of money and that I really should pay up or else. To my detriment I ignored them and even started ignoring my phone should a number ring that I didn't recognise, I was debt free so they could whistle. The last letter, recieved today, is from a debt collecting agency on behalf of the debt purchasing company, stating that things "may" get properly serious should I not take action.

Now to my questions... I have heard that there is a period of time whereby a debt becomes null and void if it hasn't been collected, is this the case? If this is the case then what is this time period and when would it start from? The date of my last payment, Spring 2005, or the date I supposably defaulted, early 2008? As far as I'm concerned, and truly believe, I don't owe a penny to anyone, but can I just tell them to sod off regardless?

Stuart

omits

Why not go to the CAB for starters - do it now?

[Deleted User]

I would be concerned that I have fully paid. You do not need to consider a void debt if you have paid. If you contact the original business that sold you the finance they must provide you with the details that you require, I would guess that you are getting a customer agent that only reads whats on the PC and can't do anything other than what they are told. This is obviously not their fault, as the last post says do go to CAB but why not write to the original lender and understand where they have put your money. If you have paid I would also look for compo. HTH.

fatbelly

Hi OddBob (Stuart)

I'm assuming that you are in England/Wales - the law in Scotland is a little different. There is a factsheet which explains the law here:

Factsheet | Liability for debts and the Limitation Act

To summarise, a creditor has a period of six years to commence court action starting at the point that you default on your contractual terms and conditions. This period can be restarted by you or your agent acknowledging the debt by payment or in writing. Note that it's got nothing to do with them issuing a default notice.

In your case, they agree that your final payment was in Spring 2005 and so, if there was a balance outstanding, they had until Spring 2011 to commence court action. After this time the debt (if there was one) became 'statute barred' and cannot be reactivated. Under E/W law it still exists but cannot be enforced through the courts.

The Office of Fair Trading have said that, in these circumstances, if a debtor says he is not going to pay such debt, then the creditor must cease 'collection activity'

So you can amend the standard letter (in the factsheet) a bit to deny any outstanding balance and point out that on their statements it would be statute barred anyway and you have no intention of making any payment. If they don't back off report them to the OFT and the Financial Ombudsman Service.

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OddBob_2

Yes, I'm in England, in which case it looks like they can go whistle :T

Many thanks for your replies chaps, I'll be paying a visit to my CAB on Friday anyway as it would also be good to chat face to face about this, safety in numbers and all that. I'll also see what the agencies next move is before they get a letter back.
One other question - if the debt still exists (which it doesn't!) in the eyes of the law would this have any negative effect on my credit rating even though payment of this "debt" cannot be legally enforced?

pauletruth

when they say you defaulted in 2008 have they registered that default. as you are sure you have paid the full amount go after the origanal company for all the data that they have on you. they must provide it for 10 quid. once you have got that deal with the new company and tell them to get lost. if by chance you did owe them money then use the statue barred route. you have a very good grounds for giving the debt collector a bit of their own medicene its against there guide lines and the law to chase a debt that is not own or disputed. and its very likely to be bared anyway hence the transfer to the collecting agency.

fatbelly

OddBob wrote: »

Many thanks for your replies chaps, I'll be paying a visit to my CAB on Friday anyway as it would also be good to chat face to face about this, safety in numbers and all that. I'll also see what the agencies next move is before they get a letter back.
One other question - if the debt still exists (which it doesn't!) in the eyes of the law would this have any negative effect on my credit rating even though payment of this "debt" cannot be legally enforced?

Well, yes it's a possibility. You need to check your credit report - probably worth doing this with both Experian and Equifax - to see if a default has been registered.

If it hasn't, then the SB approach is all that you need to see them off.

If one has, then you are going to have to do more work to show that the debt was cleared. That's where a Subject Access Request will be useful.

I hope you get somebody good at the CAB. Let us know how you get on.

OddBob_2

OK, visited the CAB earlier today, the advice was to write a letter to the dept collecting agency denying any knowledge of any kind of dept and then see what happens. Should they approach me again I can go back to talk about the next stage which would most probably be going down the statute barred route. I was given some guidance as to what I shouldn't write which was good, and even though it'll cost me the letter will be sent via recorded delivery, just incase.
I'll keep this thread updated as and when things happen