using my claim to re-pay other debt

doris1978

Hi, Just wondered if anyone knows the answer - I have recently claimed ppi back from HSBC for a personal loan I took out & paid back in full back in 2008 they have upheld my claim but tell me they propose to use the lump sum of 1346.00 to reduce an outstanding debt I owe them for a credit card? I admit that this credit card is in arrears due to being in financial difficulty but I am making agreed monthly payments to reduce it. Can they do this as this is a completely different line of credit

garynuman

doris1978 wrote: »

Can they do this as this is a completely different line of credit

Yes they can (and probably will) use it to redress other debts. Look at the bright side though - your (other) debt will be reduced as a result.

Gaz

doris1978

Many Thanks and yes your right my credit card will be almost clear once they get this payment :-)

magpiecottage

garynuman wrote: »

Yes they can (and probably will) use it to redress other debts. Look at the bright side though - your (other) debt will be reduced as a result.

Gaz

Actually, HSBC had a complaint against it for doing that upheld by FOS recently. However, it was relying on its own terms and conditions.

If is not clear what would have happened if it had instead sought to rely on the Insolvency Act.