Statute-Barred Debt - Lloyds Bank

MachoShirts

FINALLY got a response from the ProveIt letter I sent them. To update, my credit file says that the date of default is January 2011, which is the date the account was closed down and transferred to their collections team based on the information which was sent (about 20 pages of printed statements).

So my further question is: Would the default date being the first date the account went to collections be correct, or is it possible that this would've been sooner? I wasn't making payments on the account for some time while I was waiting for more information on fees and such.

Again, sorry this has taken so long for a response. It did seem like it took forever for them to get back in touch.

National_Debtline

Hi MachoShirts


You state that the account was closed in 2009 - this doesn't tally with what 1st Credit have said in their reply to you, but let's assume for now that your recollection of events is correct. It can be argued, as per fatbelly's post above, that the closure of the account marks the "cause of action". If more than six years have passed since then without payment or written acknowledgement, you have grounds for arguing that the debt is statute barred, in which case the onus will be on 1st Credit to prove you wrong.


As for the date of default, the bank wasn't strictly obliged to default you the very moment that they closed the account, but the guidance from the Information Commisssioner on the filing of defaults suggests that this might have been appropriate:


15 Current accounts
Breakdowns on current accounts will happen in relation to overdraft facilities. We recognise this is a complex area because of the range of factors affecting the relationship with the customer, and the indicators in paragraph 10 above are of limited relevance.
On these accounts the following are indications of a breakdown.
[FONT=Wingdings,Wingdings][FONT=Wingdings,Wingdings]�� [/FONT][/FONT]The customer has had an unauthorised overdraft for at least three months and the lender has demanded they put their account in order but the customer has failed to do so.
[FONT=Wingdings,Wingdings][FONT=Wingdings,Wingdings]�� [/FONT][/FONT]The lender has closed the account (or would have done so if extenuating social considerations had not dictated otherwise) because the customer has failed to use it according to the original terms and conditions. (This includes situations where an account has been opened for fraudulent purposes).

The full version of this guidance can be found at:


http://www.experian.co.uk/www/pages/downloads/compliance/guidance_on_defaults.pdf


Dennis
@natdebtline

Marktheshark

You do not ask a debt collector to admit or agree a debt is barred, you serve them notice that it is statute barred.
Passive open ended letters show weakness that makes them think you will give in and pay up.

MachoShirts

So would the ProveIt letter count as myself acknowledging the debt?

fatbelly

No

It starts off by saying

I would point out that I have no knowledge of any such debt being owed to CREDITOR

so it's the opposite of an acknowledgement.

Do you accept 1st credit's paperwork as proof that your account was closed by Lloyds in Jan 2011?

System

It is also worth pointing out that even though the debt may be statute barred, while you have an account with Lloyds they can still use the right of offset to grab the money back that is owed.

Now that you have 'stirred the hornet's nest' then this could happen

fatbelly

There's a list of reasons not to bank with Lloyds but they no longer own the debt here - sold off to 1st credit last year.

System

Unless 1st Credit hand it back when they find they can't take any action

fatbelly

1st credit buy debts. They then take over the responsibility of reporting to the CRAs. It might be sold on to someone else but Lloyds have washed their hands of this one.

MachoShirts

The balance with Lloyds has been reported as closed to my credit file for some time, so I assume they've completely sold the debt on. I can accept the date being January 2011 if it's been based on when the debt was handed over to their collections team. It means another 14 months of waiting, but it could be much worse. I know it's definitely not that straightforward.