Notice of Default under section 87(1) of the Consumer Credit Act 1974

shahidemran

I am seeking advice regarding an issue with my BA American Express card application. I applied for the card to take advantage of the offer of avios points if I spent £3000 in the first three months. I used the card aggressively in the first month and spent over £2000, which triggered a credit review from American Express. They froze my account and requested my bank statement, which I provided. My statement showed a good salary and linked savings account with a healthy balance. During this time, my first month statement was generated, and I paid it in full before the due date.

However, American Express has now served me with a Notice of Default under section 87(1) of the Consumer Credit Act 1974. They claim that they have reasonable grounds to believe that I am unable or unwilling to pay my debts when due. They have asked me to pay my outstanding balance of £300, after which they can terminate my account.

I am concerned that if they terminate my account, it will have a negative impact on my credit report. I have never had any late payments to any card and have a good credit rating. What are my rights in this situation, and how can I avoid any negative effects on my credit report?

Any advice or suggestions would be greatly appreciated. Thank you in advance.

sourcrates

A default notice served under section 87 of the CCA, can only be triggered by non payment.

Is this a credit card or a charge card ?

It sounds like a strange situation, however, if you have a remaining balance, and its paid before the date they specify, no further action will be taken, and the account will just be marked as satisfied or closed.

Shanwick

Which part of your agreement are they saying was breached? 

adamp87

This is such an odd case if what’s happened is exactly as above

“1974. They claim that they have reasonable grounds to believe that I am unable or unwilling to pay my debts when due.”

I’ve never heard of a creditor cancelling an agreement stating the above. Defaulting you without a series of missed payments isn’t even in line with the t&c’s of Amex cards I don’t believe. It’s a last resort with most agreements usually.

Have you had any luck speaking to customer service? Massively unless something else is amiss we aren’t privy too, seems over the top. And Amex customer service is usually top notch.

The alternative is somethings happened that’s spooked them having you as a customer I can only imagine. Which again would be odd given what you’ve said so far