Welcome finance/lowells debt

Marley80

Hi everyone,

I am hoping someone can offer some advice on my current situation. Apologies in advance for it being long winded! Ten years ago me and my ex partner took out a 13k secured loan with welcome finance, after we seperated I was left to pay this as I took on the house and fell into financial difficulties. The loan has been passed from one dca to another, with lowells being the most recent.

I have always paid the dca on time although it's a much smaller payment than due, unsurprisingly the loan balance never appears to shift much from year to year.

So I have two issues, I have been stuck on the same mortgage deal for years as with having a secured loan that is with a dca, no one will take me on. Is it even possible to remortgage when you have a secured loan as a bad debt? As rates are so low, I am about to try to remortgage again and just wondered if there is anything I can do to help my case? Or if it's a pointless effort?

Secondly, this debt isn't on my credit report for some strange reason and I currently have a good credit rating. I thought it might be an idea to see if I could get a full and final settlement on the loan but when I approached lowells they advised they wouldn't offer any reduced settlement and I need to pay the 11k outstanding. I had thought I could take out an unsecured loan over five years and pay it off if they offered a reduced figure.

My plan is to move abroad in five years so I really want the charge off my property so there is no issue on sale. Is it completely insane to take out an unsecured loan to pay off a secured loan? And I would have the unsecured loan paid off before leaving the country, I just can't afford monthly payments of 11k. I assumed they would jump at the chance to get a lump sum rather than minimum payments for the next 26 years! Do lowells accept f&fs or should I wait till the next dca take it ?

Thanks in advance and apologies again for the big long post,,

Marley

sourcrates

Hi,

Your lucky in one way that the creditor chose not to apply for a CCJ/charging order, then an order for sale.
I would assume the loan will still be attracting a variable interest rate, but now Lowell have bought the debt, you need to ascertain if they are still adding interest, it would depend on what the original agreement said as to weather that was the case, or not.

The reason they won't take an offer is because they can be sure of full payment if they went down the route described above.

Hard to advise really, possibly send a CCA request first of all, see what paperwork still exists after ten years.

fatbelly

With a secured loan, SC, there's no need for that route. They just need to ask the court for possession, then use bailiffs to evict. It works like a defaulted mortgage.

So it seems odd that this lender has not gone down that route.

It's only going to cost £3 to check that this is in fact secured on the house.

https://www.gov.uk/search-property-information-land-registry

If its there, it makes a lot of sense to transfer this debt from secured to unsecured if you can do that. You are moving it from priority debt to non-priority.

You can do a CCA request, as this should be a regulated debt. This would be a good idea.

There is something odd about what has happened here. It could be that there is some defect in the original agreement that would render it unenforceable (if you are lucky) or it may be that the property is in negative equity and, as a second charge holder, they would not get anything from a forced sale.

StokieBecks

How did you approach Lowell with a full and final settlement offer? Did you phone or write? You may have more success if you write formally with an offer, the only trouble then is if they agree and you then can't get the loan you are hoping for.

Marley80

Thanks for the replies.

I've been paying the dca for several years and I've never had any letters about defaults, sale of the house etc. they just seem happy to accept my minimum payment each month which now you mention it does seem strange! In fact I barely get any communication other than to tell me the debt has transferred again, they've never asked me to increase the payment either. I find it strange the loan doesn't show up on my credit report at all!

They have stopped adding interest, I do know that. I also requested all my paperwork from welcome finance a few years ago but to be honest I don't know what I'm looking for. Should I request it again from lowells and see what they hold in me or will it be the same as welcome? Any ideas?

The charge is definitely on the property, I found this out when I attempted my remortgage.

I just emailed my account manager at Lowell asking for a discounted settlement. Should I put it in writing instead then?

Thanks again for the help. Kind of at a loss at how to approach this.

fatbelly

Marley80 wrote: »

Thanks for the replies.

I've been paying the dca for several years and I've never had any letters about defaults, sale of the house etc. they just seem happy to accept my minimum payment each month which now you mention it does seem strange! In fact I barely get any communication other than to tell me the debt has transferred again, they've never asked me to increase the payment either. I find it strange the loan doesn't show up on my credit report at all!

They have stopped adding interest, I do know that. I also requested all my paperwork from welcome finance a few years ago but to be honest I don't know what I'm looking for. Should I request it again from lowells and see what they hold in me or will it be the same as welcome? Any ideas?

The charge is definitely on the property, I found this out when I attempted my remortgage.

I just emailed my account manager at Lowell asking for a discounted settlement. Should I put it in writing instead then?

Thanks again for the help. Kind of at a loss at how to approach this.

I think email is ok for initial discussions but you will want the final deal on what they call a 'durable medium' so ask them to confirm it on their letterheaded paper.

If it doesn't include 'removal of the charge' obviously don't agree to it. Are you sure Lowell know this is secured by a charge?

Marley80

they didn't even entertain me when I asked if it would be possible to settle at a discount, it was just a resounding NO! I haven't pressed the issue as i wasn't sure how to go about it.

Lowells are definitely aware it's a secured charge as it been referred to in emails with my account manager. I'm really curious now as to why I've been allowed to default for all these years!

There is equity in the house, perhaps not enough to fully pay them off fully but near enough.

sourcrates

Marley80 wrote: »

they didn't even entertain me when I asked if it would be possible to settle at a discount, it was just a resounding NO! I haven't pressed the issue as i wasn't sure how to go about it.

Lowells are definitely aware it's a secured charge as it been referred to in emails with my account manager. I'm really curious now as to why I've been allowed to default for all these years!

There is equity in the house, perhaps not enough to fully pay them off fully but near enough.

I think you should do the CCA request first, be interesting to see what they come up with, although secured loans are usually able to comply, there is defenatly something not right about this !!!

Template letter here :

https://www.nationaldebtline.org/EW/sampleletters/Pages/Information-about-your-agreement-under-the-Consumer-Credit-Act-%28sole-name%29.aspx

Marley80

I already requested the documents a few years ago (maybe about six years ago) so I still have everything that welcome gave me. Should I do another one to lowells?

And what am I looking for? I could rake out the stuff they sent me and have a look.

Should I be worried that they're suddenly going to take me to court or do you think since its went on this long it's unlikely?

fatbelly

Probably yes to a formal cca request. Lowell might not find it so easy to comply and it should be unenforceable until they do, though I've never done this for a secured loan.

Is there a local solicitor that could do a free 20 minutes and have a look at the original agreement? Some do offer this. Or would your local CAB have a specialist who could get this looked at by their 'debt expert' team (the one I work for has an informal arrangement with a specialist solicitor in Manchester).

If it went to court you could try a Time Order or get a suspended possession order. I wouldn't worry about that at the moment.

sourcrates

fatbelly wrote: »

Probably yes to a formal cca request. Lowell might not find it so easy to comply and it should be unenforceable until they do, though I've never done this for a secured loan.

I have, the process is exactly the same, and the consequences are the same if they cant comply.


In my case they produced the correct paperwork within 14 days, I was actually very impressed by that !!


However, the loan was only 3 years old at the time, so that's not surprising, 10 years may be a different matter.