Default notice - misinformed

investme

Hi folks

I have a home insurance policy with policy expert. I pay monthly, and premium credit manage the finance.

I know there's 'no excuse' for missing a payment, and my credit history has always been clean but i am feeling somewhat hard done by by whats happened and want to know whether it's worth pursuing or if i'm just going to have to accept the issue.

My second payment (of £16~) was unfortunately returned by direct debit, as the account it was made from did not have appropriate funds. Me and my partner have just moved, have new bank accounts, new direct debits etc. and as you might expect when setting up a new home with someone everything is a bit all over the place while you change addresses, accounts etc.

Anyway, as soon as I noticed, i contacted policy expert and explained. I was told me i did not need to do anything further and premium credit would re-take the payment in a week or so. So as advised, i waited.

A few days later, a default notice arrives. I immediately rang premium credit and explained the situation and what i was told by policy expert. They agreed i had been misinformed, and said they would refund a £27.50 missed payment charge, but could not agree to remove the default notice over the phone and I would need to email the complaints department.

I did this, explaining in detail that i made efforts to resolve the issue and what i was told. However today they came to their final resolution, and just called me to explain that they will be refunding the charge out of 'good will' but will not remove the default they are supplying to equifax. After a bit of back and forth on the phone I got nowhere, so said I will take it to the Ombudsman.

Feeling very frustrated at this. What chances do I have here?
The argument from PC is that I did not contact them, I contacted PE, and it is not PC's fault that i was misinformed. This is valid, but equally is there not some responsibility for a broker to accurately inform you of their lender's possible actions in this situation?

I feel like the fact that PC have agreed to refund the charge shows they are aware the fault doesn't just lie with me and my reasons are sincere - but the fact they still want to report this is disappointing. I've made genuine mistakes with lenders before (e.g. tesco credit card) where i've had a direct debit issue and explained and resolved it ASAP and they've barely batted an eyelid. This seems very petty to me.

Any advice appreciated

spadoosh

You dont immediately get a default notice for a missed direct debit and them taking it 7 days later.

What are the time frames here?

When you say as soon as you noticed im assuming you didnt notice because they sent you a letter saying you had an outstanding amount due?

And when you got the default notice why didnt you immediately pay it to avoid getting the default?

investme

You dont immediately get a default notice for a missed direct debit and them taking it 7 days later.

In this case, that's exactly what happened. The direct debit is apparently set up for the final payment due date.

What are the time frames here?

Noticed the missed payment same, or next day, contacted policy expert who told me the payment would be re-taken in a week or so. Default notice arrived the day before the direct debit to collect the missing amount (and missed payment fee) was due. (I can get exact dates if required, at work at the moment)

When you say as soon as you noticed im assuming you didnt notice because they sent you a letter saying you had an outstanding amount due?

Not quite sure I understand this. I received no communication other than a default notice from PC or PE. I noticed because i check my banking daily for reasons such as this, so sought to rectify the issue before anything happened (and how well that went :rotfl:)

And when you got the default notice why didn't you immediately pay it to avoid getting the default?

There was nothing to pay, of course as soon as it arrived, I phoned PC, but the direct debit to collect the missing payment was already set up to be collected the following day.

spadoosh

So you havent been given a default?


It sounds like youve just had a pay up or else letter, in which you paid up.

You might have a late payment marker applied to your credit file but in terms of effect on credit file it will be a pretty small impact providing your finances are typically in order.



To give you a default, they have to give you a default notice, typically theyll send a few letters beforehand requesting payment and its unusual to happen after a single missed payment. In the default notice they have to give you a last opportunity to pay within 14 days to avoid receiving a default. Youve done this so they cant apply a default to your account.

Id be complaining about their aggressive debt recovery methods. A reminder is typically much better for customer relations. Itd put me off using them in future and the lack of explanation to you is further reason to avoid them.


Im assuming the DD has now goneout and youve rang to confirm theyve received it?

investme

spadoosh wrote: »

So you havent been given a default?

It sounds like youve just had a pay up or else letter, in which you paid up.

You might have a late payment marker applied to your credit file but in terms of effect on credit file it will be a pretty small impact providing your finances are typically in order.

To give you a default, they have to give you a default notice, typically theyll send a few letters beforehand requesting payment and its unusual to happen after a single missed payment. In the default notice they have to give you a last opportunity to pay within 14 days to avoid receiving a default. Youve done this so they cant apply a default to your account.

Id be complaining about their aggressive debt recovery methods. A reminder is typically much better for customer relations. Itd put me off using them in future and the lack of explanation to you is further reason to avoid them.

Im assuming the DD has now gone out and you've rang to confirm they've received it?

Ah, okay. That makes sense. Having never been on the 'wrong side' of debt, luckily, I assumed a default notice was quite literally notice you have received a default - not a warning.

I spoke with them this morning and confirmed all is square and the refund to me is being processed.

It does seem a very aggressive process, certainly not one i've come across before.

Here is a copy of the email received moments ago with the outcome:

Dear Mr xxxxx

Thank you for taking the time to speak with me earlier today and I’m sorry you remain dissatisfied with the outcome of your complaint.

Summary of your complaint

The reason for your complaint was due to you being misinformed by Policy Expert which has resulted in a missed payment being reported to Equifax.

My findings

On 29th October 2018 we attempted to collect your payment of £16.67. However, as you explain below, and in your call to us on 8th November 2018, you contacted Policy Expert to advise the payment wouldn’t clear as funds weren’t available at the time we applied to your bank.

You inform us that Policy Expert advised that there was nothing to worry about and that we would re-apply for the payment shortly. You advise that Policy Expert did not make you aware that the missed payment may affect your credit report or that a £27.50 late payment fee would be applicable.

During your call with us on 8th November 2018, we agreed to refund the £27.50 late payment fee as a gesture of goodwill and asked that you email our On Boarding team regarding the missed payment.

We successfully collected the payment and late payment fee on 9th November 2018 and we’re now in the process of applying for your next payment due on 28th November 2018.

My decision

I’m unable to agree that any errors have been made by us in reporting the missed payment to Equifax. As explained to you, your credit agreement with us was signed electronically on 28th September 2018 agreeing to the terms of credit that we’ve offered. Within the terms, we explain your payment dates and that we may share your information to credit reference agencies, such as Equifax.


I appreciate that Policy Expert may not have explained that the missed payment would be reported to Equifax, however, I feel that if they weren’t questioned regarding this they’d have no reason to inform you of the implications it may have as they’ll be aware we issue a copy of our terms to our customers.

Whilst we agreed to refund the £27.50 late payment fee as a gesture of goodwill, we cannot do the same with a missed payment as reporting a customer payment performance is an FCA requirement, whereas the late payment is not.

As you’ve informed us that you were misinformed by Policy Expert, I’ve referred this aspect of your complaint to them to investigate further, and therefore, they may be in contact with you shortly.

I appreciate this isn’t the outcome you had hoped for and that you will be referring the complaint to the Financial Ombudsman Service. Your complaint can be referred to the Financial Ombudsman Service, free of charge – but you must do so within 6 months of the date of this email. Further information on how to do this can be found at http://www.financial-ombudsman.org.uk/publications/consumer-leaflet.htm.

spadoosh

I'd highlight the payment wasnt missed but late. Keep an eye on your credit file to show it shows as such. Its not ideal but it shouldnt cause huge problems for you, some lenders dont like lending for any naughty markers.

investme

Thank you for your clarification and advice. I've responded stating that, and my intentions of the complaint.