Possibly already paid Halifax loan sold to debt collectors

bzd

Hi all,

This is a slightly convoluted story and contains various personal circumstances, but you don't know who I am so hopefully that's okay!

Starting at the beginning (of this problem), my brother, who has moderate learning disabilities (but holds down a job and almost earns what he needs [and gets help for the rest]) got a loan from Bank of Scotland (a Halifax branch in the North West of England) a number of years ago (probably around 2005-2007). He also has a mortgage with Halifax (since 2007).

Our mum used to help him out with his finances, and was able to go in to bank meetings with him. When she died 18 months ago I took over helping him with his finances and soon found that banks would not talk to me without him present. Since I live in Scotland 300 miles away we applied for and got a financial Power of Attorney (which took over a year for various reasons).

This next bit I've had to piece together recently as I certainly didn't know anything about it at the time and I can't find any written records for this period: at some point before 2008 he got into difficulty with repayments (presumably with both loan and mortgage) which came to a head whilst our mum was abroad for a few months. He managed to sort it out himself involving the CAB and the bank and came to some arrangement which he has managed fantastically well ever since. What I strongly suspect happened is that his outstanding loan (around £3000) was put onto his mortgage (which appears to have gone up by a little more than that amount around that time) and he switched from direct debits to weekly payments which he can deal with better (saving cash up for a month is NOT his strong point!!).

He has not received a letter about the loan (he thinks) since then, and certainly not within the last two years since I've been helping him out. What's more I did go in to his branch with him in April 2011 to see how his mortgage stood and they never mentioned his loans at all (they did mention an old and overdrawn current account I didn't know about).

A couple of months ago he got a letter from 1st Credit saying that Bank of Scotland had sold his loan to them and they have started collection proceedings. I have rung 1st Credit once and got them to hold the account until end of September whilst I checked things out with the bank (registering the PoA through a BoS branch in Scotland). However, registering the PoA with the bank has taken ages [some incompetence on their part, and being on holiday on my part] and no-one I've spoken to can find /any/ record of the loan and have been unable to tell me about his mortgage (why are the people in branches so ineffectual these days???!). I think I really need to speak to a loan or mortgage person in his Halifax branch to be able to get any information from around mid 2008, possibly by phone will do, but they still haven't managed to set up the PoA for phone banking [nearly there though -- going to try again tonight]!

1st Credit have started sending mildly threatening letters to my brother and he has independently gone to CAB and sent a letter suggesting an okay repayment scheme. However, if the loan has already been repaid then he should not be paying anything!

The picture I get of Halifax and Bank of Scotland is that their records are in disarray as they seem to be in the process of splitting since LTSB took over, and I would not be surprised if the loan had suddenly sprung to life again and was instantly sold.

I guess I'm asking for any advice on who I should be speaking to in this situation, and whether what I think has happened seems plausible. What I am still trying to do is speak to someone at Halifax to send me details of his last loan repayments and statements and also of his mortgage statements from 2008 (I've been through his records and can't find /any/ mention of the loan or mortgage from 2008 [I have found 2007 and 2011 and hence know it went up by a few thousand pounds between then]).

Many thanks for reading!

Tixy

Rather than trying to speak to people on the phone, who its likely won't be able to access all the information - I would suggest writing to them. Doing a subject access request under the DPA to Halifax re both the mortgage and the loan would be a good starting point.

That should provide you with all records in relation to the loans, full list of transactions, any letters etc sent, any information recorded regarding a further advance on the mortgage or whatever.

ALIBOBSY

I would say its worth writing to first credit and telling them that all correspondance is to come to you as you have financial POA and if they continue to write to a vunerable person (I know you probably don't think of him like this but debt collectors are the scum of the earth so unless you make it clear that legally they should only correspond with you they will try to threaten and scare him into paying) you will report them to the FSA.

If it was me I would also say to first credit that you are unaware of any outstanding debt to halifax, legally and in line with FOS guidence the debt collector has to provide proof of the debt and how they calculate the outstanding amount. You will likely find that first credit will pass the matter back to the halifax/BOS as from the sounds of it they won't be able to provide any paperwork. This will give you time to get the information requests in as per the earlier poster to track what happened to this loan.

If it is still owed you can sort arrangements to pay at that point, but initially you need to make it clear to the debt collectors that this is in dispute until you can establish what (if any) debt is left on this loan.

NEVER speak to debt collectors over the phone as they have been proven to lie and threaten. Don't let them bully him into paying when its far from clear if anything at all is owed.

Ali x

bzd

Thanks Tixy and Ali,

I hadn't known about a Subject Access Request before and that looks like it would provide me with the information I need.

I'll probably write to 1st Credit and register the PoA with them and make it clear that the debt is disputed.

Cheers.