overdraft and credit card

wanttobethrifty

Can a bank add a balance from a credit card to a bank account after a person enters a DMP? example, overdraft £500 limit, with £493 used, credit card balance of £3467, current account now at £3960 overdrawn, credit card on credit files with a £0 balance

[Deleted User]

No. They're separate entities.

wanttobethrifty

just as i thought, as i am helping a friend with debt problems, and First Direct have amalgamated both into the account. The correspondence from HSBC collections only states a sort code, and an account number, with the total debt from card and overdraft on there, and only 1 debt showing on credit files, which is consolidated debt. How do i go about getting this sorted?

fatbelly

I take it that the card is defaulted, and that the overdraft is no longer used.

This is accepted practice for banks and seems to be increasing.

I don't think it makes a lot of difference to the 'customer' as long as interest is not being added.

It may actually make the debt more difficult to enforce.

As your friend is now on a DMP, I don't see any point spending  time on this.

Are you actually managing the DMP for your friend or are they with someone like stepchange?

wanttobethrifty

The bank account has defaulted, the credit card is only showing as closed with a 0 balance on his credit files. He has been on a DMP with a company that was charging a fee for past 4 years, and his total debt has only reduced from £19k to just over £16k. I am not managing this for him as such  but getting him away from fees to self managed. Was going through everything to do CCA requests and came across the above. Should the bank account also be CCA requested?

fatbelly

You can't request a cca on a bank account but as it's a combined account now you should do one on the credit card and see what comes back.

They've made things very complicated for themselves

Yes - definitely a good move from fee charger to self-managed .

wanttobethrifty

He has no details of the credit card now, and the only reference details on any mail, are the account sort code and number. It was confirmed in a phone call he made last week that both debts had been amalgamated, and under the reference 00-00-00/12345678 (example). He has registered a complaint regarding this, so will wait see what comes back. By "very complicated", in what way?

sourcrates

wanttobethrifty said:

He has no details of the credit card now, and the only reference details on any mail, are the account sort code and number. It was confirmed in a phone call he made last week that both debts had been amalgamated, and under the reference 00-00-00/12345678 (example). He has registered a complaint regarding this, so will wait see what comes back. By "very complicated", in what way?

When debts end up with collection agencies, its one of your statutory rights to get them to prove you actually owe the debts they are chasing you for.

When companies amalgamate different accounts, they are creating all kinds of problems for themselves.

The usual burden of proof, comes in the form of a credit agreement, a copy of the one you originally would have signed.

Now by amalgamating these accounts, they are creating a debt that did not exist in that form, when you originally signed the credit agreement, so no evidence will exist that these two amalgamated accounts ever belonged to you, as the original reference numbers will be different, the balances will be different, nothing will match up basically, so the debt cannot be proved.

Now they do this to make less work for themselves, and in the hope you don`t ask too many questions, which is why you never trust what a debt collector tells you, and you always ask for evidence of liability, for just this reason.

wanttobethrifty

Both debts were with First Direct, (credit card and bank account) and now passed on to HSBC Repayment Services. Should i just send the provit letter, or is there any other way to catch them out on this?

sourcrates

HSBC repayment services are just the in-house collection arm of HSBC.

So the debt is still with them.

I wouldn`t bother doing anything until this debt has had time to go through their collections process, then ultimately been sold on.

A debt purchasing company such as Lowell or Cabot will probably pick it up at some point, that would be the time to challenge the debt, once its been sold, until then monitor any correspondence, but otherwise ignore.

wanttobethrifty

Thank you, will pass on this information, and not make any payments meantime. will monitor mail and see what transpires