What to do about default?

radiocat

Hello,

I have two unsecured loans, one with Coop and one with RBS. My Coop one, which is up to date (although with a renegotiation of payments) is for about £10k (with about 4K paid off) and a £5K loan from RBS where I've repaid 3K.

I have a number of health conditions, including a neurological one, that make it very difficult for me to remember when to pay bills. Setting up a direct debit isn't that helpful because my income comes primarily from a supportive relative who sends me a variable lump sum every few months (so if I forget to move the money around to cover bills/DDs, then I get hit with fees from my bank ... this happens very regularly. I think I've paid about £150 in bank charges in the last 6 months for unpaid items.) I've managed to stay on top of the coop loan, but the RBS one for some reason requires me to do a couple of different transfers each month, and when one fails due to cash flow they all stop and I have to set them all up again ... and it's really complex for me as I can't call the bank for help due to accessibility issues and there isn't an RBS branch in the town I live in so I can't pop in and get it sorted. The last few months nothing has been going into the account, and then I put in a lump sum to put it back in the green, now the same thing has happened again and I've tried to pay another lump sum online but the system is rejecting it and I can't log into my account through the online banking system.

My callcredit report is showing a notice of default for the £2000 I still owe RBS (my coop loan isn't even on my credit report, which is weird) and my credit score is now 1 star and way in the red. They also have the wrong address for me (which is not my fault, I did tell them when I moved), so I presume the notice was served to that address but I have no idea when. Callcredit is not showing any CCJs or anything -- if I don't/didn't respond to the default notice on time, what are they likely to do or have done? I have no idea if they've just served it or did so months ago.

I don't have 2K available to give them, but I could offer them 1K now and probably the rest in a few weeks. I don't know how to sort this out, given that I can't call them or send payments online. Does anyone have any advice?

Edit:

Updated my credit report. RBS shows a bank account that they have closed that has this note: 'The account has been satisfied. The payment status has been reported as in default' and the default amount is £179. No idea what that is about.

The loan account is still open and says 'not defaulted' and that the payment was made for the last 3 months (news to me!).

I'm so confused.

Tixy

Hi and welcome to the forum

Sounds like your banking is too complicated for your current situation in terms of you having to move money around. Do you have more than 1 bank account? perhaps if just had 1 bank account things might be easier for you.

You say your income mostly comes from a relative - are you getting any benefits you may be entitled to? if you had regular benefit income coming in you may find it easier to ensure your bills are paid.

The RBS loan on your credit file - does the edit to your post mean this is no longer showing as defaulted?

Do you still have/use an RBS bank account? Is this your main bank account that you use and do you have an overdraft on that account? On the credit report what default date is given?
Is this account the one that you pay the RBS loan from? Do you have the bank statements for this account?

radiocat

I use an account with another bank, separate from the other two. I did this last year when I was behind with both loans and worried the banks might seize the funds if I had to just default on everything.

I'm unfortunately not entitled to any benefits for various reasons, I've already investigated this.

The RBS loan is showing as 'not defaulted' on my updated record but the account status is 'not available'. The payments to that account used to go from my main account with a third bank (who I don't owe anything to!) to the current account with RBS, and from there be drawn down into the loan account. But if the RBS account has been closed by RBS ... then I'm unsure how the loan account is showing that payments have happened on time for the last 3 months ...

According to Equifax, the RBS account was okay until Feb this year, defaulted in May (overdraft, I presume, I was a few hundred overdrawn and paying in about £60 a month to bring this down). Then it has an 'S' for a 'satisfied' account closure in June.

Callcredit's version of events is that the account was okay till April, then defaulted July and Aug, and was then marked 'SF' (symbol same colour as default so I guess it means closed but in default? It says "The account has been satisfied. The payment status has been reported as in default".)

I have no accounts with RBS besides that one and the loan account (still open). I don't understand where the money is coming from to pay the loan account now, unless RBS is just seizing everything that goes 'into' the closed current account and redirecting it into the loan?

Tixy

RBS will likely be offsetting any funds in the RBS current account to the loan.

If you had access to the bank statements you could see if this is what has happened.

Might be worth writing to RBS, correcting them on your current address and then asking them to send out a statement of account for the loan (and current account if you don't have statements).

You could briefly explain in the letter that you have health problems and are not currently working and that your conditions mean that you cannot communicate with them by phone.

Then you could state that you are in a position to make a payment towards the arrears but are no longer able to pay them online. Ask them to send you details of where you should make your future payments.

radiocat

Thank you, Tixy. That's a really sensible suggestion. Should I write to the branch that originally gave me the loan?