Freezing Interest?

Manoona

Hello,

I know there are many posts on this and I have read through a few but none of them match exactly the info I need.

I am trying to help my brother out, his one and only debt is with a credit card that he used to use for his self employment. He has not made a payment on this card for well over a year now. I have spoken to the card company and they have refused to freeze the interest on it until this goes to a bailiff.

They also told me that if this happens it will effect his credit rating and as it stands at the moment, his non payment has had no ill effect - I dont believe that not paying a credit card bill for over a year can have no ill effect, is this right?

Does he really need to wait until they are willing to pass it across, they have already told him to cut up his card, which he did a long time ago anyway.

As I said before he is self employed and has not been working at all since Christmas and even before then it was a few small jobs here and there.

How long is it likely to take for them to pass the debt to a bailiff, as if this is what it takes to get the interest frozen then he will wait - the credit card is with Lloyds, who is also who he banks with, so surely they can see that no money is being paid into account at the moment??

Any advise would be greatly appreciated. I have him coming round later with details so I can get a copy of his credit file for him.

Thanks

thenudeone

Manoona wrote: »

They also told me that ..... at the moment, his non payment has had no ill effect - I dont believe that not paying a credit card bill for over a year can have no ill effect, is this right?

No it's not right. His credit record will already look pretty bad - he should get a copy for £2 each from the 3 main agencies and see what it already says.

Manoona wrote: »

the credit card is with Lloyds, who is also who he banks with, so surely they can see that no money is being paid into account at the moment??

He needs to move his bank account out of Lloyds ASAP. Banks have the right of offset which means that if he ever pays some money in, they could instantly take it to pay the overdue debt on the credit card without any other authorisation.

Other than that, it may be better asking in The Debt-Free Wannabe Board

stephane_2

I doubt very much that not paying for a year will not affect his credit report, I am amazed that after all this time they have not issued him with a default notice. Why does he not seek help from a citizen advice bureau? They would deal with the creditor on his behalf. Your brother needs to take his responsibility and am sorry to say move his back side!!
Very likely that eventually Lloyds will sell the debt to a debt collection agency, will be issued with a default which will destroy his ability to get any credit for the next 6 years.

SnowTiger

Manoona wrote: »

How long is it likely to take for them to pass the debt to a bailiff...

They won't pass it to a bailiff. That's a long way down the road and probably wouldn't happen. Oh, and your brother's ability to get credit will already been affected. Few will lend to someone who hasn't paid their credit card bill for a year.

There isn't anything he can do to stop the CC company adding interest and charges. They'll sell the debt on eventually and are probably deliberately letting the fees and charges build up to inflate it.

Your brother could write to them saying that he's willing to make payments of £x per month providing they freeze interest and charges. They may agree, but from what you've said I think they want to let the debt build up and sell it on.

Manoona

Ok, thanks guys - He is getting it sorted, believes he can pay £100 per month but obviously this means most of that is in charges and was hoping he could get it frozen - looks like theyre not going to budge on it! but thanks for the advice!