Old debt new problems

GRL

I'm looking for some advice for my current predicament. I received a letter yesterday from a debt collection agency for a debt I have no knowledge of. I contacted the agency today to provide me with more detail around the alleged debt which comprises of 2 pay day loans from 2 different companies. They confirmed to me that debts are from 2010.

In the interim they have put the account on hold for 14 days and have said they will forward me more information. I signed off on the call stating that I categorically do not acknowledge these debts and that the correspondence I acted upon was the first I knew of such debts.

I have put all my debts behind me and built up over a long period of time a solid financial record so I am curious to understand what damage this agency can do to me......

Can they pursue these debts?
Can they issue me with a default if I chose to ignore them?

I can’t see any further back than mid 2017 on my Experian so I do not know if a default was issued by the original lender or not.

Any advice would be appreciated.

Many Thanks

CakeCrusader

It depends on the debt, but most are statute barred after 6 years (unless it's a mortgage) so they can't take you to court for it. Default wise, they might, but again you can argue that they are statute barred as things older than 6 years fall off your credit file. I'd wait to see what they come back with.

GRL

Thanks for responding. They said that the debts are pay day loans one at £750 the other £450.

[Deleted User]

What do your credit files say?

If the debts defaulted over 6 years ago then they are stature barred and not enforceable anymore anyway.

GRL

Credit file is clean, completely clean. When I cleaned things up years ago I never saw anything that matched these values.

I!!!8217;m not convinced the original lenders ever issued defaults against me that appeared on my file.

Based on what i!!!8217;m seeing It seems that they are in no position to pursue the debts through the courts but it would be damaging if they issued a 2018 default against the account they hold ....i!!!8217;m Strugggling to see how I can default on something presently that dates back to 2010 is that possible?

[Deleted User]

No. It would have defaulted by now and is not stature barred. Likely they are trying their luck.

You!!!8217;ve asked for proof of the debt which should include the default date. If this is more than 6 years ago then you can go back to them and tell them it!!!8217;s statute barred and to no longer hassle you for it.

Who is the collection agency?

ciderboy2009

!!! wrote: »

You!!!8217;ve asked for proof of the debt which should include the default date. If this is more than 6 years ago then you can go back to them and tell them it!!!8217;s statute barred and to no longer hassle you for it.

This is not quite correct.

Statute barring occurs when 6 years (5 in Scotland) have passed since you last acknowledged the debt (ie: by making a payment).

So, if 6 years have passed since the default but you made a payment on the debt 3 years ago then it would not be statute barred.

Likewise, if the default was issued 5 years ago but you last made a payment a year before that then it would be statute barred.

Anthorn

GRL wrote: »

Credit file is clean, completely clean. When I cleaned things up years ago I never saw anything that matched these values.

I!!!8217;m not convinced the original lenders ever issued defaults against me that appeared on my file.

Based on what i!!!8217;m seeing It seems that they are in no position to pursue the debts through the courts but it would be damaging if they issued a 2018 default against the account they hold ....i!!!8217;m Strugggling to see how I can default on something presently that dates back to 2010 is that possible?

Just because the debt has never appeared on your CRA file is pretty much meaningless: It could be that the lender does not report to CRAs.

You have presumably already told the lender that you don't owe the debt and have no knowledge of it. So now the onus is on the lender to prove that the debt is yours. The classic way they do that is to produce the original agreement bearing your signature. You should also check that you have lived at the address on the agreement and your bank might be able to produce a statement for that period so you can check that you have received the money.

Under the Limitation Act 1980 the lender has 6 years from the date you last communicated with them about the debt or made a payment to take court action to recover the debt. If they haven't done that then the debt can no longer be legally enforced although you still owe the debt. Just tell them the debt is statute barred. The drawback is if they don't agree it's statute barred and take court action. in that case you will have to defend it but don't ignore it.

Lastly if you do in fact owe the debt you can use the statute barring as a stick toi beat the lender and secure what amounts to be a very low partial payment in full settlement.

GRL

OK so what I am seeing here is......

A default ( even if not on the credit file) is the date the agreement was defaulted? - I will check with the collection agency (Lantern) to confirm this. So in theory they can't issue a default at say next week on something I may have defaulted on over 8 years ago?

I have not acknowledged, paid or spoke to anyone in over 8 years around this debt (1st letter I have seen / responded to was the one on Monday) and based on this the Debt appears to be unenforceable in the courts.

Is the above correct?

I'd also like to understand that if this debt does turn out to be correct and I make a payment in full what happens to my credit file.....I assume they will report the account as satisfied and I end up with a bad debt profile against my file anyway.

It seems like a problem in any scenario!

[Deleted User]

GRL wrote: »

I'd also like to understand that if this debt does turn out to be correct and I make a payment in full what happens to my credit file.....I assume they will report the account as satisfied and I end up with a bad debt profile against my file anyway.

No. An account cannot be reinstated once dropped off.

[Deleted User]

They cannot add it to your files now, no.

If it is statue barred then you're not obliged to pay it, and they cannot involve the courts to recover.

If however you have a moment of compassion, you may decide to make a token payment to settle it.

But, you're not obliged to