Defaults and payments

talmik

Hi all,
I am looking for help with a problem my partner has, I have no experience with debt (thankfully) so I am at a loss.
She has 3 defaults on her credit file, all will hit there 6 years next year, 1 loan and 2 credit cards. My partner also had two loans that were paid off so she made a call to Gladstone to look at reclaiming the PPI, due to these defaults she was put through to a debt management agency instead. They believe we are probably entitled to about 7000 back in PPI but will only make the claim for us if we enter into a payment agreement to pay off the defaults. As we are so close to the 6 year mark I would prefer to just forget about the money and wait but they told us that at any time, even after the default expires, that the bank could decide to turn the defaults into a CCJ. Is this true?

We pay one debt company £50 a month for one of the credit cards, in the 5 years they are the only people to contact us for money back. The other credit card and loan were both with natwest, when we contacted them they said they had no record of my partner. The debt management people want a minimum of £80 a month and £35 of this goes to them for fees... they also take 30% of the PPI reclaim which all seemed counter productive to me.

On a final note they also advised that my partner and I should do a joint claim, I have a loan and credit card which I pay every month and have never missed a payment on. But they said that my partners rating would effect mine so I may as well set up an arrangement with her. I am not that stupid so I know this bit is 'odd'.

I could really use some advise. Can a CCJ happen even now? even though the bank apparently have no record of my partner. Is 6 years really the end of it? or should we just enter into a payment agreement but maybe with a different company?
Thank you for reading my huge post. I am really confused here and would really appreciate your help.

Tixy

The account entry and default drop off her file 6 years after the default date on file.

A creditor can commence court action for up to 6years from the latest of the date she last paid or wrote to them to acknowledge that she owed the debt.
So the one she is paying £50 towards, could take her to court up to 6years from now at least (although its probably unlikely unless she stops payments). The others, it depends on how long since she last paid them or wrote to them.

Definitely do not go with the fee charging DMP company.
I also wouldn't use any company for a PPI claim either. If she wants to try to reclaim PPI that she thinks was missold then there are full detailed instructions on how to do this on this forum.

If she did want to enter a DMP then recommend she uses one of the charities that won't charge her any fee, or she could just continue making her own payment arrangements as she has done so saf.

In terms of your own finances - if you have any financial links (i.e. joint accounts for bank, mortgage or loan) then you will be financially associated on your credit files, and the defaults already on her file could affect your ability to get credit.

talmik

Thank you for your reply, it is a help and brings some comfort.
The £50 we could continue to pay, we can just about afford it. There is a large loan with the natwest, no payments have been made since May 2009 and it is listed on the credit file as going into default in October 2009. We went into the natwest and they said they had no record of my partner. I thought this meant they had probably sold on the debt, but no one has been in touch with us and that was 3 years ago. At this stage is it worth waiting for the 6 years to be up?

We will definitely look at the charities instead.
I understand about the link causing a negative impact on my credit, just thought it a terrible thing to suggest I bail on my commitments because of the effect. she has. I assume you agree it should be a solo claim?

Many many thanks

Tixy

I understand about the link causing a negative impact on my credit, just thought it a terrible thing to suggest I bail on my commitments because of the effect. she has. I assume you agree it should be a solo claim?

If she is going to try to reclaim PPI herself then she applies individually to each company that she thinks she had PPI on that was missold.

If you think you were missold PPI you could also do a separate claim(s) yourself (although this wouldn't not be bailing on your commitments, reclaiming PPI doesn't mean you won't continue to pay your debts).

There is a large loan with the natwest, no payments have been made since May 2009 and it is listed on the credit file as going into default in October 2009. We went into the natwest and they said they had no record of my partner. I thought this meant they had probably sold on the debt, but no one has been in touch with us and that was 3 years ago. At this stage is it worth waiting for the 6 years to be up?

So as things stand at the moment it sounds like the debt will become statute barred in May 2015 if the creditor/debt collector doesn't commence court action before then.
In terms of trying to reclaim PPI - I am not sure whether this would effectively restart the 6year timescale, I assume it would but I don't know if the templates for a PPI reclaim somehow do not acknowledge the outstanding debt, it might be worth asking on the reclaim PPI section of the forum as I would imagine its a question that has come up before and the regulars who post on there may well know the answer.
Reclaim PPI & Other Insurance
Do you think the PPI to be reclaimed on that debt would be more or less than the outstanding balance on it?

talmik

ah I see I was not clear. The debt management people wanted us to make a joint claim for the payment plan not for PPI. They were suggesting I should include my loan and credit card in with my partners debts. I thought this was crazy as I pay my loan and credit card every month.

When it comes to PPI we would just forget about it if the debt was going to become statute barred in May 2015. We would prefer it gone than getting that money back. We are just worried that if we enter into a payment agreement that it will stir up a debt that may have just expired next year :-/

I really appreciate your help, it is great to talk to someone with some knowledge about this.

Tixy

Yep crazy. You do not need to enter a DMP and of course wouldn't want to.
The people you were talking to gladstone and then a commerical DMP company are only interested in trying to make money out of you, hence why they may suggest totally stupid ideas.

talmik

We have decided to move in with my parents, not fun but we will be able to save a lot there. I think we will save until May as a just in case, hopefully the loan just drops off and we never hear from it again. But if we are contacted at least we will have some savings we can offer to them before setting up a payment.

Thank you again for your help, it is very much appreciated.