Unenforceable debt

hoverFrog1

Under Sections 77 to 79 of the Consumer Credit Act a lender has 12 days to provide a copy of the credit agreement or the debt becomes unenforceable. What happens if they provide this information after the 12 days have passed, say two years later?

How would a court view this if it went to court? What does unenforceable mean? Would a company really go to court over an unenforceable debt?

SusieT

It is only unenforceable until they provide the correct credit agreement. Even 5 years later it would become enforceable again, unless by then it was statute barred of course.
They could go to court over it, but they would have to send a letter before action, and at that point you would refer them to the fact that they had failed to provide the agreement and they should stop action. If they do not stop action they will look pretty daft in court when you point out to the judge that you asked for the agreement x years ago and also when you received the LBA

sourcrates

As above, the 12 days to provide are just guidelines, average time can be 3-6 months or more.

Unenforcable means they cannot obtain a judgement against you in court, as by definition, they have no evidence to prove the debt is yours.

In reality, they could hire an expencive solicitor, obtain other evidence, and ultimitly prove you took out the agreement, but this would cost more than the debt is worth, so companies tend to not pursue such cases as there is little point in spending 5k to prove you owe a 2k debt.

When these cases do progress to court, the hope is the debtor will not defend the case, thus resulting in a judgement by default.

This happens quite often, if you believe a debt to be statute barred or unenforcable, then you must defend any legal action on that basis to avoid the above happeneing.

Another favorite is for the claiment to send court papers to an old address, and obtain judgement, again, by default, this is quite a common trick used by a lot of the debt purchasing companies, you need your wits about you when dealing with such people as they will not hesitate one second to screw you.

hoverFrog1

Why have the 12 day deadline at all then?

sourcrates

hoverFrog1 said:

Why have the 12 day deadline at all then?

As I said, it’s just a guideline, set down in the CCA, it sets a minimum response time for creditors.
A secured creditor would be able to provide the information within the timescale, Unsecured lenders are more liberal with there working practices, therefore take longer, it’s all academic in the end.