1st Credit Long time debt ~ Please help

clngai

Hi all,
I am quite new to this and would like some help from you guys, any advice or opinions will be appreciate. My story is as below:
About 5 to 6 years ago, I was a University student. I got offer by HSBC for a credit card and a student account which I have an overdraft for £1200. As for my first time to have credit, I do not know how to control my spending and I end up like most of the people - gets into the debt. As a student, I am not able to pay it off. As far as I remember, I did not pay this off and I have not heard from HSBC anymore.
In recent months, I think I have learned to control my income and expenditure, so I decided to apply for a credit card again. The application was successful and I have a credit card again. However, last week, I have received a letter from HSBC stating the money I have owned them and they have passed it to 1st Credit Finance Ltd. (This is how I remember I have the HSBC account when I am student). Yesterday I have received 2 letters from 1st Credit asking me to pay them back ASAP.
My question is do I still have to pay back the debt as I have heard the debt will get write off if they do not contact you within 6 years (Please correct me if I am wrong). I am not in a good financial situation at the moment and I am struggling to pay them two thousand pounds in just a sudden.
Please kindly advise me what to do with them if I do not want to pay for it. What will happen if I ignore the letter? Do I have to send a CCJ to them?

steve1980

So you took an account with HSBC and a credit card, went wild, but didn't get a job whilst at Uni to pay for anything?

As 1st Credit Finance have sent you a letter they obviously know where you now live. Contact them, explain your "plight" and arrange a pay plan. Get a job (if you haven't got one) and get some money in. If you ignore it then you will, get a CCJ (You don't send a CCJ, they will apply to the courts as YOU owe them money, not the other way round).

fermi

clngai wrote: »

My question is do I still have to pay back the debt as I have heard the debt will get write off if they do not contact you within 6 years (Please correct me if I am wrong). I am not in a good financial situation at the moment and I am struggling to pay them two thousand pounds in just a sudden.

Unless you are in Scotland, the debt isn't written off.

But it may be statute barred.

Please read the info here: https://forums.moneysavingexpert.com/discussion/2606811

fatbelly

Hi Chagi

I'll try to deal with a couple of those points.

A creditor has six years to commence court action from when you first breached the terms of your contract. With a credit card that initial point is easy to define - you miss a minimum payment and the six years starts there. With an overdraft, the start point is when the bank formally calls in the debt, and that can take a long time.

If there has been a six-year period then the debt is said to be 'statute barred' and once barred, always barred. That does not mean that the debt is written off but means it cannot be enforced in the court.

There's more info here

Factsheet | Liability for debts and the Limitation Act

This all assumes you're living in England/Wales.

It's not possible to say what WILL happen if you ignore 1st credit. They have options, as have you, if they are the current owners of (both?) accounts. The letters may have used the word 'assigned' - that means that HSBC sold the debts to 1st credit, probably for about 10p in the pound.

Cross posted with Fermi but singing from the same hymnsheet!

clngai

Thanks for all the advise. I think the best way will be waiting for 1st credit to contact me again and see how it goes. I believe the debt is over 6 years and it should be in Statute barred status.

clngai

Today I have got another letter from 1st Credit:

We regret the sum detaied remain outstanding. We are considering issuing County Court proceedings against you and any claim will include a claim for legal cost and interest.

If we obtain a judgement against you and it remins unpaird for 30days it will be entered in the Register of Judgements, Orders and Fines, making it difficult to obtain credit at competitive rates.

Subsequent failure to make payment of the judgment could result in enforcement action:

- An application to your employer for an attachment of earnings.
-An application for seizure of your assets by County Court Bailiff.
-An application for a Charging Order against your property, (if owned by you).

In order to avoid any potential proceedings please contact one of our agents on 01737 235202 and agree repayment terms.

Gavin Flynn

Head of collections.


Does it means they are going to court action? will they contact my employee regarding to this?

I am a bit worry now. Should I contact them by letter as I have read the forum, a lot of people have bad experience contacting them by phone.

What are my options now?

PLease help as I am getting very stress and nervous about this.

Thank you very much

fermi

Please read the info in the links in the previous posts.

If you think the debt is statute barred, then there is a letter to send in those links.

If you are not sure, then give National Debtline a call free on 0808 808 4000 to talk it through.