Interest on Student Loan CCJ pre 1998

Musical_Joe

Hi all,

Everyone on this forum has been so helpful to others, and I have read plenty of advice - so thank you all, it has really helped me.

I have an issue that I can't seem to find an answer for elsewhere however, so perhaps someone would be kind enough to give me some advice.

I had a student loan (technically 3 loans, 3 years in a row but lumped together now) in 1995, 96 and 97. I did pay money off it regularly (to a 3rd party collector) but they didn't actually pass the money onto the SLC, and I ended up getting a CCJ. That isn't the main problem though, as with a lack of paperwork (when I was younger I buried my head in the sand a whole lot), I can't find who I paid, what bank account I paid it from etc. etc.

Anyway, spin forward to now, and I'm paying £50 a month through deduction of wages on a £6000 debt. I'm happy with this, and just want to get the debt clear now.

I have just read a statement from the SLC, and they are still putting interest on the CCJ amount. So for every £50 I pay off, they just whack another £21 on.

My question is: Is this legal? I have read that loans prior to 1998 ARE subject to the 1974 consumer credit act, however IF there was a 'contractual interest' clause, they MAY be allowed to do this. of course, having thrown away all of my paperwork during my 'ignore it' period, I don't have anything to refer to, so I can't see if there is a contractual interest clause.

Does anyone have any advice they can give me? I just really don't to pay double what I owe if I don't have to - I'm not trying to get out of paying it (despite the fact I was scr*wed over by the debt collector in the first place), I just want to pay what I owe and be done with it!

Hope some kind soul can help...

thanks in advance,

Joe

fermi

All my old style loan agreements from SLC contain a post judgement interest clause.

fermi

Earlier ones.



Later ones.

Musical_Joe

Ah, OK, thank you for that - So it looks like they can continue to apply interest. That's a real shame!

Thank you for your help,

Joe

fermi

Worth reading ----> Interest charges on a consumer credit judgment

Musical_Joe

Interesting - I may try writing to the court and ask for a time order - as in:

"You can write a letter to the court asking for the court to consider making a time order ‘on its own initiative’. You should include an offer of payment that you can afford backed up with a copy of your personal budget; ask for interest and charges to be stopped, showing what you can afford and mentioning any relevant personal circumstances that affect your offer."

That way at least I'm not 'giving up'.

Thank you again!

thechippy

Joe,

What year did you actually get the CCJ?

This is a complicated area....

Really, you need to get a copy of the loan agreements, but also a copy of the actual judgement itself.

Not only should they have applied for post judgement interest within the particulars of claim, but they should have also been given judgement for it. Judges themselves are not too clued up in this area....

If the judgement for example is just for £xxx and nothing else mentioned, they are on dodgy ground.

Really, the judgement should say something like...judgement for £xxx + interest as per the agreement.

In any event, the post judgement interest has to accrue in a separate pot outside the judgement. Basically, you pay until you have cleared the judgement amount and the ccj is then deemed as settled. They would need to bring separate proceedings (issue another claim and take you back to court) for the interest.

Musical_Joe

Thank you thechippy. The CCJ is from 2009.

I guess then the best plan is to write to the court and ask them for a copy of the judgement? If it just says £xxx (with no mention of interest), I should then:

- write to the SLC and point this out
- write to the court and ask them to 'confirm' this to the SLC

If you have a moment would you care to advise if you feel if this is the best course of action?

Thanks again,

Joe

thechippy

Ok,

As it's from 2009 the new rules apply which are a bit clearer....


From 2008..
" Once a judgment has been entered, the creditor has to serve notice that they are claiming post-judgment interest to the debtor. There is a statutory requirement to do this under s130a Consumer Credit Act 1974. Further reminders of their ability to claim it have to be sent to the debtor every six months. This interest can be charged from the date the first notice is given, if the creditor does not serve the notice they cannot add it until they do actually serve the notice.

Due to these new rules a creditor cannot include a claim for post-judgment contractual interest as a part of the actual judgment itself within the particulars of claim, they do not have the legal entitlement to do so – interest can only start to accrue once notice has been served on the debtor - which starts after the court order has been granted. Therefore, the post-judgment interest will accrue in a separate pot, and not part of the original judgment debt at all. This rule is made very clear via the prescribed rules outlining how s130a notices should be served and also via Reg 9a of the Enforcement, Default and Terminations Notices Regulations 1983."

Bearing in mind the above, it's also quite clear that the provision for post judgment interest has to be within the original agreement and a specific additional entry has to be on the default notice. If not, they can't charge it.

I'd send a cca request to obtain a copy of the loan agreement.
Also, write and get a copy of the judgement, including a copy of the original claim, as we will need to know what the particulars of claim were.

Who are you actually paying the money to now?, slc or a dca?