PLEASE HELP! Default dispute with Santander

FinancialMatters

Hi,

I'm new to this forum and seek advice regarding my particular situation. I have scoured through many forums but have yet to stumble across anything that could point me in the right direction. If those that wish to reply to my thread, please do so with positive information as some may not feel comfortable once having read my journey to obtaining a 'Default' on my credit file.

In 2010, I was sentenced to serve a custodial term. Having graduated a year prior to this and still seeking employment in my desired industry, my life literally came crashing down. Although the incident took place some 2 years before a jury decided my fate, I was not deterred to better my future upon my release. As I mentioned however, I had been sentenced and I no longer had any hold over my financial matters. I was visited by an internal bureau who specifically dealt with those who had financial relationships with certain institutes to inform them of my circumstance.

One of these institutes was Santander (Abbey at the time). I was advised that they would be contacted and either my account would be suspended or if minimum monthly deposits were continually made (I was told £1 each month would keep the account active) I would be able to sort out any matters upon my release. Not wanting to ruin an almost uncomplicated 8-year relationship with Santander, I sought help from family members to deposit the advised amount each month.

8 months had passed by and I was released in 2011. One of the first priorities on my list was to contact Santander. I visited a branch who informed me that the account no longer remained active and that they could not provide me with any further information. Extremely baffled and disappointed, I contacted telephone banking who again reiterated what the branch staff had informed me of. At this point I simply turned my attention away from Santander and opened up an account with another banking institute. Bearing in mind all post sent to me between September 2010 and May 2011 had been retained by family at home and I spent a whole week or so sifting through mail and chased up/resolved all correspondence. Not a single letter from Santander regarding this 'unimportant' matter.

With a criminal record and conviction, my chances of employment remained slim to none. But then staying negative gets you nowhere. So I searched and searched, applied and re-applied when finally a company contacted me and was willing to take a risk or give me an opportunity (depending on which way you see it). Albeit an assistant management role, I was more than ready to look forward having paid for my mistake.

3 years on, I am now a Company Director and my time served is a distant memory. Well, that's what I thought until I obtained a copy of my credit file and noticed that Santander had placed a 'Default' on my report for an overdraft facility on my then student account which had around the same time during the start of my sentence reverted to a graduate account. This meant that the authorised overdraft limit decreased. Not knowing this at the time, a period of four months elapsed and the account was 'Defaulted' in February 2011.

So I began searching online for answers or assistance but couldn't find much on disputing a default given my scenario. However, what I did do was send Santander a letter (via recorded delivery of course along with a £1 postal order) kindly requesting information regarding the 'Default' and any correspondence (including) notice(s) of intent to file a 'Default'.

A reply was made by an Historic Archive Business Manager informing me that my account was not regulated by the Consumer Credit Act and therefore no credit agreement was attached to my account.

I then contacted the same person via telephone (with much persistence) and explained my story. I once again requested information regarding the account and copies of any correspondence that had been sent to me warning me that the account would be 'Defaulted'.

Instead, I received a quite contradicting information pack with a copy of the final statement and general terms and conditions. I did not receive any notice of intent. In addition, the accompanying letter stated that my account WAS regulated by the CCA as it had an overdraft facility.

Once again I am left baffled with Santander's helpful assistance. Not only did they simply end a near-decade long relationship with a customer who had no previous negative financial dealings with them, even though they were contacted by the internal bureau regarding my situation, along with minimum deposits paid into the account every month, I am left with a sole blemish on my credit file for a further 3 years. This of course will adversely affect any application for future credit, loans and the most important one, a mortgage. But I am no closer to coming to some sort of resolution with Santander. I was aware that my account entered the overdraft facility whilst it was a student account, however they had failed to inform me that the limit would also be reduced as a result of the account type changing to a graduate account. Of course I would want to pay the money I owe and be done with it, but a 'Satisfied' mark on your file is just as good as a 'Default' and I don't believe that should be justified.

My argument, as I'm sure this has become quite a lengthy post, is that if the account was regulated by the CCA, a 'Default' notice or intent to file a 'Default' should have been sent. If the account was not regulated by the CCA how can Santander pass on information to Credit Reference Agencies and inform them of the 'Default'? Either way, neither has been substantiated and having to wait 30 days at a time for someone to respond to my letters with contradicting information does not help in the slightest.

I feel that this should have been handled in a more professional and possibly understanding manner from one of the high street's top banking institutes. However, I am again left looking back at a time that kept me standing still and years later has the same impact. So I ask, what is the best way to come to a fair resolution with Santander? I want to pay for any owed amount, however on a technicality, the bank failed to adhere to their responsibility regarding the CCA and issuing a notice of intent to 'Default'. Can it be possible for them to change the status to a 'Late' payment or better yet remove the 'Default' in its entirety as a gesture of goodwill once the balance is settled?

I hope what I have stated here makes sense and if anyone is able to help or would like me to clarify certain aspects further, I look forward to hearing from you.

Many thanks in advance.

itsdagal

In this instance I would suggest calling Santander and explaining the circumstances around your situation. I recently had a similar dispute with Nationwide, however mine was as a result of moving away and not being aware of charges being applied to my account.


After discussing with them, they agreed that as the account had been settled then they would remove the markers and the default and they have subsequently done so.


In some cases (with the original creditors) I find it better to talk to a person then send a letter (though others may disagree) as one phone call can save months of letter sending.

Tixy

Overdrafts are regulated by the consumer credit act. However they are exempt from certain parts/sections of the act.

These exemptions include the requirement to have a signed agreement using the prescribed terms required by the CCA and I believe also the requirement to send out a notice of intention to file a default with the credit reference agencies.

Will see if I can find some references to the relevant parts of the act that overdrafts are exempt from.


In terms of it is possible for them to change the status on your credit file - yes they are able to do so if the chose to (as a gesture of goodwill). But I suspect it is unlikely that they will agree to do so.

but a 'Satisfied' mark on your file is just as good as a 'Default'

That is not necessarily the case, especially with things like mortgages. It would be far easier to get accepted for a mortgage with a satisfied default than an outstanding one.

Thrugelmir

I was advised that they would be contacted and either my account would be suspended or if minimum monthly deposits were continually made (I was told £1 each month would keep the account active) I would be able to sort out any matters upon my release.

Did Santander accept this offer or not? Were Santander actually notified?

piedmontboot

To clarify here, are you saying the account defaulted because of the reducing limit due to it automatically converting to a graduate account, which then left you over the limit?
I'd request a subject access request (Google it) - the limit reduction would've been in the t&cs of the account when you opened it, but they should've written to you when the limit was being reduced.the SAR would mean they have to supply historic correspondence.
You could also ask for copy bank statements from when you were away to get a clearer picture of what happened with the account.

FinancialMatters

Hi Thrugelmir - I followed the advice provided to me by the rep from the internal bureau. When I managed to speak with branch staff and telephone banking, neither could comment on this.

FinancialMatters

Hi piedmontboot - yes, according to the information I've gathered the account defaulted because of the reduced overdraft. I was over the limit and subsequently, during the following four-month period prior to entering a 'Default' status, additional charges were accumulated.

In the T's&C's Santander recently sent me, it is stated that notification of reduced overdrafts is not mandatory (polite yes, but essentially they were not obliged to send any correspondence). However, a notice of intent to 'Default' the account would have been in order.

Instead, the account was simply closed by the bank.