NRAM Class Action on redress method.

manvdebt

My view on the matter is this:

As NRAM have not complied fully with the CCA 1974 Section 77, the Debtor should have the right to choose how the redress is applied.

The money paid to NRAM is not legally theirs, as it was collected illegally and in Breach of the CCA 1974 Section 77.

A complaint needs to be made to the OFT by a registered Consumer Group - is their any group willing to take this complaint on?

NRAM being the party who is in the wrong should not be able to simply dictate how and when any compensation or redress should be applied.

Interest has been accrued on the unlawfully collected payments and this has not been factored in. NRAM may also be incorrect in the sum of redress offered and have been wise not to disclose a detailed statement of the interest payments during the period that interest should not have been collected.

NRAM in the short term is not affected by this issue as effectively they have received a loan from the Customer and can forecast this over a number of years, whereas, the Customer, will have to wait a number of years before reaping any benefit from this. In the short term, whilst NRAM has illegally collected interest payments not due to them, they are the ones who will accrue the interest, therefore they are accruing interest on a sum of money not due to them and effectively will not be affected by this in the long term. On the other hand, the Customer has lost interest on a sum of money that could have been distributed elsewhere and will miss out on accruing interest on this sum over a number of years with only NRAM seeing the benefit. NRAM have also failed to mention the fact that the Customer should be liable for compensation and statutory interest on the payments that were unlawfully collected.

NRAM state that they believe the proposed method of redress is the most appropriate course of action, the most appropriate action for whom? NRAM who has committed the breach?

The statement that NRAM believe the “loan will have been interest free for a period of time” is absolute tosh. I have paid the interest which was factored into my repayments, therefore, it was not interest free. As the interest was paid on top of the principle, I have lost accruing interest on this amount.

The statement that NRAM feel “the impact on your account is positive and as a company we are able to fulfil our obligations to treat our Customers fairly” is also nonsense. This is fair only on NRAM as the Customer was never given a choice. This statement also adds to the concern that this decision was made by NRAM based purely on the benefit to them as they can “fulfil their obligations”. Does this mean that had they offered the Customer a choice of the method of redress they would not have been able to fulfil their obligations?

This issue should simply not be swept under the carpet by NRAM, they have unlawfully collected interest payments from the customer and are in no position to dictate how this money should be redressed without consultation of it's Customers.

lennonc1

manvdebt wrote: »

My view on the matter is this:

As NRAM have not complied fully with the CCA 1974 Section 77, the Debtor should have the right to choose how the redress is applied.

The money paid to NRAM is not legally theirs, as it was collected illegally and in Breach of the CCA 1974 Section 77.

A complaint needs to be made to the OFT by a registered Consumer Group - is their any group willing to take this complaint on?

NRAM being the party who is in the wrong should not be able to simply dictate how and when any compensation or redress should be applied.

Interest has been accrued on the unlawfully collected payments and this has not been factored in. NRAM may also be incorrect in the sum of redress offered and have been wise not to disclose a detailed statement of the interest payments during the period that interest should not have been collected.

NRAM in the short term is not affected by this issue as effectively they have received a loan from the Customer and can forecast this over a number of years, whereas, the Customer, will have to wait a number of years before reaping any benefit from this. In the short term, whilst NRAM has illegally collected interest payments not due to them, they are the ones who will accrue the interest, therefore they are accruing interest on a sum of money not due to them and effectively will not be affected by this in the long term. On the other hand, the Customer has lost interest on a sum of money that could have been distributed elsewhere and will miss out on accruing interest on this sum over a number of years with only NRAM seeing the benefit. NRAM have also failed to mention the fact that the Customer should be liable for compensation and statutory interest on the payments that were unlawfully collected.

NRAM state that they believe the proposed method of redress is the most appropriate course of action, the most appropriate action for whom? NRAM who has committed the breach?

The statement that NRAM believe the “loan will have been interest free for a period of time” is absolute tosh. I have paid the interest which was factored into my repayments, therefore, it was not interest free. As the interest was paid on top of the principle, I have lost accruing interest on this amount.

The statement that NRAM feel “the impact on your account is positive and as a company we are able to fulfil our obligations to treat our Customers fairly” is also nonsense. This is fair only on NRAM as the Customer was never given a choice. This statement also adds to the concern that this decision was made by NRAM based purely on the benefit to them as they can “fulfil their obligations”. Does this mean that had they offered the Customer a choice of the method of redress they would not have been able to fulfil their obligations?

This issue should simply not be swept under the carpet by NRAM, they have unlawfully collected interest payments from the customer and are in no position to dictate how this money should be redressed without consultation of it's Customers.

How can we get a registered consumer group going? how many people could there be as a bare minimum ??

have a look at this link, northern rock action group (shareholders), good info on the articles.

http://www.uksa.org.uk/action/northern_rock

DevCoder

If you take it back to bare basics.

NRAM have a right to restore you into a position as though the issue did not happen.

They can choose the course of redress which will be looked at and deemed either fair or unfair if complaints are sent through the normal channels and if necessary raised to the FOS.

You certainly have more of a claim to how the redress should be applied than the BoI rate rise debate currently going on (for which I think any talk of individuals seeking legal action against a bank with the rise in its T&C's is madness given the costs).

The interest element should be allowed to be un-wound to the point of returning a neutral position to both parties.

NRAM appear to be sticking their heels in with a redress of a tenure reduction as opposed to a repayment of interest. I personally think end people are better off with this offer but that would be assuming that people don't need immediate funds for other purposes.

Having read into it I can only assume that the people requesting immediate recompense are those who have other debt issues, so it would be very difficult for someone to judge either side as to what would be better (for that you would have to know the spectrum of people comfortable with their current debt and would be better off with a tenure reduction against those who are in debt issues and would be better off with an immediate repayment)

The costs of class action can be huge, when going with a class action you need to consider whether the costs will outweigh the benefits of the recompense, especially if you lose.

tracy7

drussmonkey wrote: »

In an attempt to demonstrate your basic and continued folly in wanting this money back as cash now now now, I have put together a very simple Spreadsheet to demonstrate how the application of redress affects your account in the long term.

Basically you can see that £2500 taken off your account today means your mortgage would finish just over a year early. In other words you save £4776 in interest and £7274 OVERALL.

This saving is admittedly lessened with a smaller loan of £10-15k (but by turns, the term is also much more reduced) but the principle is identical. Redress applied by shorterning the term is the best thing for you. This spreadsheet also demonstrates the benefits of overpaying even small amounts. Over time it'll dramatically reduce your term and save you lots of money. Think about it!

Excellent, some real figures, I had to work it out all long hand having had my pc sabotaged by a virus last year. I knew there was a huge potential saving as I had done my own spread sheets years ago when I first took out the mortgage to see the effect of overpayments on shortening loan term and the money saved on interest. Now people can have a REAL IDEA of the worth of this redress in terms of their own circumstances.

lennonc1

I do agree, but it's unfair to assume that their own method is best, not for every one! If they were being fair there would be a choice for the individual customer, if they choose to pay other debt or use it to pay the mortgage if they are struggling with that. In my case it will go back to them by paying the mortgage while I try to sell and move into rented accommodation as I have 1 bedroom bungalow and with a new baby have absolutely no room. Everyones cirumstances are different, if this was my family home and planned to stay long term then of course I'd take the term reduction as that makes financial sense.
I know any action taken will be very costly but there might be a chance you win and happy days, but the risk is still there and I am a woose,

tracy7

Stupid_Question wrote: »

You do realise that for something on this scale NRAM will have consulted with the FSA, lawyers etc on this don't you?

Also - don't take this the wrong way - NRAM have better lawyers and deeper pockets than you.

drussmonkeys post is spot on, the way they are offering your redress is the best long term option for you.

Of course they have consulted on this, and this is probably the reason it has taken so long for anything to be agreed on the action to take. Their response will have taken into account any argument against this method, it will have involved calculations which would have influenced the decision. The decision will have been made on affordability and the ability by them to make this repayment, based on the impact it has on the tax payer, services and investment for the country. The reason the ex NRAM customers are being sorted out after existing customers is that their interest will not be accumulating as ours has been.

manvdebt

OFT Guidance on Super Complaints:
...as a new use not allowed to post, use Google, it is your friend!

NRAM have a right to restore you into a position as though the issue did not happen.

This is true and this is the view I would imagine the FOS would take as they have done with the PPI issue. The complexity of this is if you had an extra £x to put towards your DMP, IVA, Trust Deed or even your shopping or other essential bills should you have had to amend these due to keeping up your loan repayments in fear of losing your home; yes even though the loan was unsecured, however many believed and assumed if they did not pay their "Unsecured Loan", they may well indeed have lost their home.

There have been many reported issues relating to Northern Rock "Together Mortgages" in this sense.

NRAM appear to be sticking their heels in with a redress of a tenure reduction as opposed to a repayment of interest. I personally think end people are better off with this offer but that would be assuming that people don't need immediate funds for other purposes.

I for one am in need of these funds to reduce my financial burden caused by the banks. Why, having caused this situation, they should also be allowed to dictate how it is resolved in their interest is beyond me. The Banks failed and were bailed out, I had a debilitating illness in my family and we were put through the mill, whereas, reckless juvenile casino bankers got off scot-free and bailed out. Bitter, no, just disgusted that I am being dictated to by a company who cannot get their accounts in order.

The costs of class action can be huge, when going with a class action you need to consider whether the costs will outweigh the benefits of the recompense, especially if you lose.

This is true, and this is what NRAM want you to believe. In actual fact, NRAM know they are in the wrong, we as Consumers are entitled to our money back and NRAM are playing a game of smoke and mirrors.

This is not the first time I have experienced this. The institutions who have almost limitless funds; rather more than the average punter, lead you to believe that any formal action would be futile and more financially damaging than the position they are already in. The truth of the matter is, NRAM are in the wrong, they know it, have prepared responses; hence the speed of the standard letter they sent out, and are in fear of giving back the money they were never legally entitled too.

The whole argument of the more cost to the tax payer, is, quite literally, !!!!!!!!, as the tax payer put their trust in the Government to get the take-over correct in the first place.

The Government has failed the Tax Payer, owes us inconvenienced by their mistake a refund, yet appeals to the majority who did not take this sub-prime mortgage to white-wash their mistake.

NRAM should be liable to offer the affected Customers a choice in what they would prefer to compensate them for their mistake:

- Shorter Term on their loan including statutory interest on unlawfully collected payments OR

- Compensation in the form of statutory interest on their unlawfully collected loan payments, plus the unlawfully collected loan payments to distribute to their outstanding debts as they see fit.

At the end of the day, NRAM made the mistake, the Customer should be consulted on how they should be compensated, regardless of whether the Government have been apparently granted decree.

The Government are not the Law of the Land and only a Judge can decide on the eventual outcome. Not NRAM's advisory team of Lawyers. Lawyers voice an opinion and a Judge makes Judgement; sorry NRAM, but that is how the Law of the Land works, whether or not you are Government backed.

That is why we need a Consumer Group to take this case further.

lennonc1

Thanks manvdebt, you have been most informative and helpful, how do we start our consumer group then? If Facebook a possibility, could set up action group and as it is private you can conduct most from there! I am all for the fight, I'm just pretty useless lol

manvdebt

Unfortunately a Consumer Group has to meet certain complex criteria set out by the OFT. There are a few registered groups who could take action:

- Consumer Association (formerly Which?)
- Consumer Focus
- Citizens Advice Bureaux

Again, this would be a long and possibly costly process. There may well be other avenues that can be explored in the short term with little liability on our part.

My initial letter has went into NRAM with the standard response from them in a matter of days.

The next step for me to approach them in a slightly different manner and get them doing some work in order that I can get as much detail as possible before eventually going to the Financial Ombudsman.

What we need is as many complaints going into the FOS as possible.

A dedicated group of some sort would generate interest from the media etc and public exposure, however we would need a large number of group members and someone who has a bit of a presence within the industry. The financial industry unfortunately has a "job for the boys" culture.

How did you get on with your MP?

Going to put some details together to build up a case and decide on the best route forward.

shaney1981

I still have no response NRAM re my complaint, other than the standard we'll get back to you. I am treating this as my account is in dispute with regards to the outstanding redress. I am maintaining payment which I have offered them and so far I have no correspondence refusing my offer. They need to understand that despite their 'mission' to pay their debt to the taxpayer asap they still have a role to their and their customer service is nothing short of disgraceful. There seems to be no consistant message being given to any one person and each customer who's needs and circumstances are different are being considered. It after all was their fault, regardless of the fact they 'admitted' it. They should not choose how they resolve the situation via a 'one size fits all' remedy just because it simplifies the process for them.... it could have been a darn lot simpler if they had stuck to their own legal obligations....