Halifax FOS decision on DMP payments

peachykeen

I have just paid off a £50k+DMP and now it's complete wanted to share my experience with Halifax. Halifax initially agreed to the terms of the DMP, set up via StepChange. All my other creditors agreed to the freezing of interest or vastly reduced interest rates, too. After a year, my pay went up. I was always fully honest with StepChange, telling them exact income and outgoings. What I didn't realise is that Halifax would take the extra few pounds I would pay, after the initial year on the DMP as a sign "my circumstances had changed" - this translated to them reinstating full interest - going from 1% to 21%. They refused to acknowledge I was still on a DMP, would not work with StepChange (despite on their own paperwork stating 'if you are in financial difficulties, speak to StepChange'). For over three years I wrote to them - they would never acknowledge my circumstances, despite taking the monthly payments. Over the full course of the DMP, by the final payments and having paid £6k, I had according to Halifax only paid off around £500 of the original debt. At breaking point, I rang the Financial Ombudsman. It took a year of LOTS of paperwork going back and forth but the FOS adviser decided that I had been treated unfairly - Halifax were advised to refund £3k from my "outstanding" debt and make a 'in recognition of the distress caused' goodwill payment. FOS said they should have either a) defaulted me on payments and passed to debt recovery or b) maintained reduced interest on repayments as I was doing everything in my power to repay my debt.

I know Halifax are renowned for their treatment of people on DMPs. I hope this gives those of you in similar position the push to contact FOS. I tried speaking to Halifax "advisers" on several occasions - they were incredibly unhelpful and downright rude. I was naive when I took out an account with them and on reflection, they were irresponsible to lend me so much when I was already in debt. You live and learn, but if Halifax are crippling you with their interest rates on a DMP, there is hope. Contact FOS today.

Suseka

Thank you for sharing. I'm in a battle with Hfx who is the only creditor of mine currently charging interest and flatly refusing to budge on that. I've just started completing the FOS paperwork and although I'm only a few months into my DMP -with a long way ahead of me -I'm hoping the FOS will push Hfx into a more helpful stance.

My concern is that Hfx apparently have this policy that states if you are paying 33% or more of your contractual agreement they won't stop interest -and I'm wondering as I progress through and monies paid to each creditor increases as the smaller ones drop off, whether I'll face the same dilemna with others down the line!

Anyway - well done for reaching the end of your DMP :T

rizla_king

Well done. Those bstards at Hellifax need taking down a peg or 2.

thewhiteavenger

It used to be much better before it became part of Lloyds.

monika0613

I have waited till all my Halifax cards and loans are taken over by Blair Oliver and Scott, and they then as DCA, stopped charging interest from the day the DMP was set up, and actually earlier ( from the day I told them I going to set up a plan ). Halifax actually told me to do so, wait till they close your accounts after 6 months of not paying, then when they transfer to DCA, interest will stop

rizla_king

Ironically it is often better to stop paying for a bit until they pass it on and stop charges.

Puzzcat

There doesn't seem to be any logic with how the creditors work with a dmp. I started mine in November, and Hfx sold me to a dca in January. They also never charged me any interest despite my dmp payment being over 50% of the original min payment..

Monkeyballs

So frustrating, it's almost as though they are taking it personally...
I read a story like this and can't fail to see the irony of banks who throw credit at you when it is profitable to them to do so but then when folk hit on hard times seem to want to crush them into submission instead of working with them to an amicable solution.
I could understand if you were running away from your debt and not taking responsibility but when you put your hands up and say 'I'm in trouble and need help' you would think that they would do whatever it takes to support you in repaying them what is owed.

MB