Lender has terminated my loan in error, where do I stand

Conrad2

Lou67 wrote: »

Maybe so, but even so, I doubt very much that the whole loan would be written off because of an error. They will want their money

By defaulting on the agreement, all be it in error, the lender has rejected the contract there-in in favor of collecting the monies via an alternative method. They have chosen to do that in error, but they have chosen to do it. The problem is, they now have no tool with which to reclaim the money. The agreement entitled them to terminate and collect provided they follow proper procedures in the CCA74. They have not only not followed those procedures, they have also terminated the agreement unlawfully, allowing me to accept their default as an invitation to rescission. They may not like it, and they may want their money back, but their actions have created a situation by which both parties have now voluntarily cancelled the agreement. They have not served a proper DN, they have no right to ask for any money back, and it is within my rites to seek damages for their actions as the innocent party. ie Their rescinding of the agreement was unlawful, where as mine was voluntary in response to their unlawful act. this is all on the excellent link posted by cos last night (http://legal-dictionary.thefreedicti...on+of+contract). Thanks cos.

My case is not the same as those where people have sought loopholes, where they protested that text was not reproduced correctly on a DN, or that the agreement was in some way invalid because of errors in the original agreement. In my case the lender proceeded to terminate my account and seek full repayment unlawfully and without notice, and made no attempt to correct the situation, even though it is stipulated that they have a duty to ensure that information about debts is correct before proceeding with collection. Once again; my account was entirely up to date as per the agreement when this started and remained so up until they terminated it. As a matter of law, they have no entitlement to claim back the money, nor to reinstate an agreement without my, er, agreement.

It is the lender who has created this situation, and do you really think I am going to go back to them to offer £25,000 as a good will gesture? Would you? And there can be no come back on this as the decision was mutual. It sounds incredible, but it makes sense when you view it objectively.

It was not my intention to write off the debt when I came to this website for help. I was hoping that someone could reassure me that I would have some hope of recourse when treated so appallingly by a lender; again, I went from model customer to collection order in 18 days with only one meaningful warning to repay, with a deadline that was cut short by termination. How on earth can anyone say the bank has acted properly.

I can only say it again. I was OK with the account as it stood, and would still be paying it to day if they had not acted unlawfully.

Conrad2

Lou67 wrote: »

I think people are just advising based on what they know and based on their own experience Conrad. Many people here aren't trying to be mean or nasty and most are trying to help. Maybe you should seek legal and professional advice, starting with a solicitor. Many of them do free consultations for the first visit. I genuinely doubt though, that the lender will write off the loan, no matter what they did - or didn't do...

You are right, and it was advice through the private messages that put me on the track of unlawful resciprossity. There has been good advice, and there are certainly good people on here that are trying to help, but there is a lot of misguided information that will adversely affect consumers if they take it. it needs to be challenged or this forum will defeat its stated objective. People shouldn't just gain say something because they THINK it can't be true. We have far more rights than people either imagine or are prepared to fight for, particularly as consumers, and if something seems genuinely unfair, it is likely it will be found to be so in court. And it is unforgivable that people resort to school yard bullying or accusations of illegal actions just because they cannot perceive something that is grounded in truth.

I did seek legal advice yesterday, and have been advised that the lenders actions (and inn-actions) are most likely to be construed as breach of contract.

talana

Still chuntering away I see Conrad......
And what have you done away from the forum to move the situation forward while your credit record is getting well and truly trashed?
Invest your time in sorting it out in the real world (yes, your way if you really must, but don't hold your breath for success) rather than arguing with everyone.

simon_the_poet

HI
I dare say you will believe what you wish, the facts aare as stated in my earlier post.
More simply put, you read a lot about debtors being able to force creditors to write debts off through some legal loophole, the truth is that none exists.
It used to be possible to render an agreement unenforceable, but even that did not mean that the debt had been written off, a debt must be repaid unless the creditor agrees to gift it, or just gives up on trying to collect it.

Simon

Conrad2

talana wrote: »

Still chuntering away I see Conrad......
And what have you done away from the forum to move the situation forward while your credit record is getting well and truly trashed?
Invest your time in sorting it out in the real world (yes, your way if you really must, but don't hold your breath for success) rather than arguing with everyone.

You are in complete denial. The lender is liable to put right its mistakes and will be dealt with lawfully if not - then they would have to pay me even more moolah, and one thing they really won't want to do is throw good money after bad.I didn't, haven't and couldn't possibly default on it now because it no longer exists.

You really haven't got a clue and should stop selling yourself so cheaply. At best, my debt will be written off and my credit record returned to good form, at worst, I will have a new agreement with the lender that is more satisfactory than the previous one, (which was heavily weighted in their favour), and my credit report will be returned to good order.

I cannot be made responsible for their errors whatever you think.

You can wind me up, but you can't burst my bubble.

Conrad2

simon_the_poet wrote: »

HI
I dare say you will believe what you wish, the facts aare as stated in my earlier post.
More simply put, you read a lot about debtors being able to force creditors to write debts off through some legal loophole, the truth is that none exists.
It used to be possible to render an agreement unenforceable, but even that did not mean that the debt had been written off, a debt must be repaid unless the creditor agrees to gift it, or just gives up on trying to collect it.

Simon

It's not a legal loophole, its is a matter of law that if one party unlawfully defaults on a contract, the other party can accept that in rescission of the contract. It is something the lender will be aware of, and probably the reason why they haven't contacted me regarding this so far.

Why so? It is in their interest to leave me to contact them and unwittingly mention resumption of the agreement, because they can then declare that I have not rescinded, just as payment of the 1 Oct premium by DD would have allowed them to do. More so than anything, cancelling the DD was the act that gave me strength of argument, yet it is the thing most cited in this thread as bringing me doom. According to some, the bailiffs are probably outside me doors as I type, and I'll never buy another house unless I contact the lender now and beg forgiveness; well, please have a rethink.

if they contacted me, they would be obliged to recognise the rescission, and would be acting unlawfully if they implied that the debt is still due. So allowing me to drop myself in it is their only hope of recovering the monies.

As it happens, my initial response was to inform them that I had cancelled the DD and did not intend to pay any more money in relation to the now non existant agreement. Thankfully, these words accept their repudiation of the agreement, and though I didn't know the legal term at the time, represented rescission. I have now responded as advised confirming rescission using the terms most recognised in law so that it is clear.

I can't say I knew what rescission was, or that such would nullify the agreement, but I did feel very strongly that I was within my rights to stop payments to the lender and consider the agreement broken. I expected they would be able to take me to court, but have been informed that by dint of rescission, they have mutually agreed to reject the agreement, leaving them with no apparatus with which to recover the money they gave me. Even better, our relationship now returns to that which it was before the agreement was made, meaning that no debt exists and it cannot be considered outstanding. So no issues with the credit report.

It is important to state this here, as borrowers in my predicament, with a lender acting totally incorrectly, should be aware that improper behaviour by a lender can be dealt with strongly.

If this is resolved as I predict, I will post details here of what action was taken, and what the pertinent points were that made rescission possible, for the reference of those that are affected by similar circumstances.

It would be useful to consumers if members of the forum considered rescission as a possible action to recommend. But as you say, it is not for people trying to find loopholes, it is there for people who have been acted upon incorrectly.

Conrad2

r

simon_the_poet wrote: »

HI
I dare say you will believe what you wish, the facts aare as stated in my earlier post.
More simply put, you read a lot about debtors being able to force creditors to write debts off through some legal loophole, the truth is that none exists.
It used to be possible to render an agreement unenforceable, but even that did not mean that the debt had been written off, a debt must be repaid unless the creditor agrees to gift it, or just gives up on trying to collect it.

Simon

Sorry to keep on, but after further research

VERY IMPORTANT POINT

Simon, what you have said about repudiation and rescission is partly correct, being where a debtor attempts to stop repudiation (unilateral termination of the agreement) when a creditor has served a faulty default notice. The reason for people attempting use of this is to find a loop hole that prevents an attempt to terminate the agreement and and seek full payment. It protects the creditor from trivial attempts to prevent collection following genuine default.

Consumer credit, though overseen by CCA74, is still governable as a contract by common law unless overridden by CCA74. CCA74 carries no advice on the treatment of unlawful repudiation ,or contract breach by a creditor, as such is catered for in common law. Common law entitles the debtor, or whichever party has not repudiated a contract, to accept that repudiation as invitation to rescission. This is what has happened in my case, as I have not defaulted, yet the lender has breached.

This is another important point for posters to consider when offering advice, as it does not seem to be readily recognised here, though it be proper and lawful.

tomwakefield

That Rescission of Contract link mentions "restoring the parties to the positions they would have occupied if no contract had ever been formed" and "He or she might instead repudiate the contract, tender back what he or she has received..." a number of times. Doesn't that involve giving back the borrowed money?

Conrad2

Phew. I think I can finally get some sleep.

This whole thing seems clear cut. I will post anything else that may be of interest to people who find themselves in this situation.

Although many posters have taken a dislike to what I have had to say, I hope they will recognise that my persistance has paid off, and that the information I have brought to this forum could be of great use to any consumer being so appallingly treated by their creditor. I know too that there are a number of you who feel that the bank has been very hard done by, and even that the bank still has recourse to reclaim the debt. Before posting again to refute what I have found, please do some research on rescission of contract, unlawful repudiation and common law of contracts. You will learn a great deal that will make the information you provide to future consumers in crisis actually useful. Some on hear may also want to eat their hats.

I have not entered into this as a money grabbing loopholer, but as a consumer fighting for his rights, and the treatment of me by some members has been unbelievable. Can't say I didn't enjoy it though, it was just like Christmas Day East Enders, only interactive, and with the Gumby's guesting.

Finally, just want to say once again that if the the lender had observed CCA74, treated me properly, carried out rudimentary checks, listened to my complaint, or simply attempted to get in touch with me, we would still be in agreement and I would have had no problem with it.

Sleep well experts.

Conrad2

tomwakefield wrote: »

That Rescission of Contract link mentions "restoring the parties to the positions they would have occupied if no contract had ever been formed" and "He or she might instead repudiate the contract, tender back what he or she has received..." a number of times. Doesn't that involve giving back the borrowed money?

'Restoring the parties to the positions they would have occupied if no contract had been formed' indicates that the borrower has no debt, as was the case before the original contract was signed. In other words, the lender cannot seek to recover any money from the former borrower, that they cannot consider the former borrower to owe monies, and that future dealing with the former borrower be without prejudice. Therefore no bad credit report, and no bad feelings or else.

And yes, the second part does involve the return of monies to the lender; It is in the non repudiating party's right (in this case, the former borrower) to give back the money if they so wish, but only by new agreement which cannot be forced on the party and must be mutual. Not sure that many will go for this option, but it is there for them if they feel the urge.

Really must go now...