Can I make a claim for miss-sold PPI on credit card I defaulted on and then settled?

AdKM

Not trying to convince the internet. Just asking if anyone else has been in the same boat as me. Looking for a precedent and advice that is all. If I feel the advice being given might not be accurate though I think it's ok to ask further questions. :beer:

AdKM

I remembered badly. It was in fact 60% that I paid. 40% was written off. Sorry for any confusion in this respect.

dunstonh

If I were successful though would I not be right in thinking that the debt was actually settled and thus any compensation due could not in fact be used to redress anything outstanding. Isn't a 'settled debt' exactly what it says?

A settled debt involves the lender agreeing to take a reduced amount in order to no longer chase you for full payment. PPI redress is allowed to go against debt written off against agreed settlements.

Moorcroft Debt Recovery would seem to be an independent debt recovery company and not 'in house' collectors of any bank or other lender.

Do you know that or is that a guess?
Banks stopped using in-house collections many years ago and contracted it out to firms.

Technically, if the bank sold the debt rather than contract it out to a collection agency then the PPI redress cannot be used against that debt. The exception being if the bank has the option to claw it back from the collections agency.

I have looked at the FOS decisions and found several that show that despite HSBC using external companies, they still own the debt.
1:
"I note that HSBC has used different departments and even external companies to recover
the arrears on Mr F’s credit card. However, HSBC has said that it still owns the debt.
Therefore, it is legitimate for it to use the redress to reduce the arrears which Mr F owes."

2:
Mr D has said HSBC sold the debt to a third party. HSBC says it hasn’t sold the debt, but
passed the collection of the debt to a company who is part of the HSBC group. Mr D feels as
this third party is a company in its own right the debt is no longer owned by HSBC.

HSBC has provided full evidence and details of the debt and although it has a third party
collecting the debt this is done on behalf of HSBC. A business can instruct a third party
business, for example sometimes solicitors, to seek recovery or repayment of a debt. That
third party may be a separate entity but they do not when acting as collection agent own the
debt. The debt is still owned, and would be paid back to, the business, in this case HSBC,
who is owed the debt.

Overall I think the amount HSBC has offered to refund the costs of the PPI is fair. I also think
it is fair that HSBC uses the compensation against the debt Mr D owes on loan 5458

AdKM

Interesting. Thank you for that. The done thing now might be to try and ascertain if those original lenders did indeed sell the debt to Moorcroft or just use them as a collection agency. I think I'd much rather leave well alone though rather than risk potentially opening a can of worms. I have a lawyer friend who works for Barclays. I might ask him for his input on this before completely leaving it though.