Capital on Tap business credit card

chullbulla

Hi Everyone,
I have already post on this group about my personal debts and planning to start DMP, I need advice about how to deal with my business credit card debt of Capital on Tap, I already advised them I cannot make payment and they asking why, I am worried that they might be more difficult to deal and I end up losing my home, my personal debts and business debt all connected in a sense that I have no more trading under business I had this card and no income is coming except my salary.

sourcrates

For business debts speak to Business debtline, as different rules may apply.

chullbulla

Thankyou sourcrates, even if personal guarantee involved?

sourcrates

chullbulla said:

Thankyou sourcrates, even if personal guarantee involved?

Hmmm, they will be able to advise better than I can, its not really my area of expertise.

chullbulla

I contacted the CapitalonTap informed them situation and also mentioned that I will wait for it to get default and appear on my personal file then will deal along with personal debt, below is their latest reply.

The next steps have been highlighted in previous emails. Please either -
- Continue to maintain your monthly payment as per your contract.
- Follow the normal collections journey when your account falls in to arrears.
- Provide us with the required documents (3 months personal and business bank statements along with a completed income and expenditure form) and a monthly affordable proposal for us to consider a longer term arrangement.

SusieT

chullbulla said:

I contacted the CapitalonTap informed them situation and also mentioned that I will wait for it to get default and appear on my personal file then will deal along with personal debt, below is their latest reply.

The next steps have been highlighted in previous emails. Please either -
- Continue to maintain your monthly payment as per your contract.
- Follow the normal collections journey when your account falls in to arrears.
- Provide us with the required documents (3 months personal and business bank statements along with a completed income and expenditure form) and a monthly affordable proposal for us to consider a longer term arrangement.

They have set answers, and defaulting you is not on that list yet. Just ignore them until they do default you, and then start again with them. You are actually doing number 2, so are going along the collections journey as the account has fallen into arrears, so wait for the computer to catch up with you and get to the point where it sends out the default notice.

chullbulla

Hi, I received the latest response from Capital on Tap, I believe I should not contact their solicitors when they contact me until it has defaulted on my personal file? 


I must make you aware of the following terms and conditions while there is no arrangement in place for you. As I understand these are strongly worded however we have a requirement to make you aware. These terms will change to cover once we have further information regarding your debt management plan.

No access to funds until the arrears are cleared.
MMP will continue to be generated and payment will be due as normal.
Interest will continue to be applied as normal.
Until an arrangement is in place, expect to receive all Collections Comms (SMS’, Emails & Letters).
Late payments will be reported on the business credit file and may impact your ability to get “Better Offers” from Capital on Tap and business lending from other providers. Once the account is back on time, this will also be reflected on your business credit file.
Account at risk of being Terminated and Default placed on business credit file if we are not able to put an arrangement in place.
Account may be selected for late-stage collections / legal action through our solicitors.
A reminder of Personal Guarantee: You are liable for payments if business fails to pay.
If your account exceeds 90 days late we will start reporting your Capital on Tap account on your personal credit file even if there is an arrangement in place.

sourcrates

How much is owed on this card ?

All a personal guarantee means is that you become liable for the debt if the business cannot pay it.

The collection process is the same as any other debt, as is the criteria for collection of it.

So there is no reason why this debt should be treated any differently from the rest of your debts, unless its a silly amount of money, and you own a house with a large amount of equity, if that were the case, it would be considered a priority debt, and you would need to proceed very carefully to avoid things escalating.

chullbulla

It's currently at £19k and you know interest will not be stopped unless defaulted.

I own a house and equity will be around £100k minimum, how can it be priority debt if not a secured credit card?

Also my house is jointly owned with my wife.

sourcrates

chullbulla said:

It's currently at £19k and you know interest will not be stopped unless defaulted.

I own a house and equity will be around £100k minimum, how can it be priority debt if not a secured credit card?

Also my house is jointly owned with my wife.

In that case, the creditor cannot obtain a charging order on your house, only a restriction, should they choose to do so, so your house should not be at risk whatever happens.

If the house had been solely owned by you, then a charging order, would have been possible, which may of led to an order for sale or a statutory demand, making the debt an obvious priority.

chullbulla

Thank you, I believe these charge order and order for sale are last resort, but I am willing to work with creditors once default on my account.
Another thing I was worried that creditors can apply for bankruptcy if debt is more then £5k?