Help with Creation / Equivo pending CCJ

TLAWR

Hi Everyone,

I am dealing with Creation regarding a personal loan that I cannot pay the contractual monthly payment on.

I stupidly buried my head in the sand until the letter from the courts arrived and have lodged a defence regarding how much more the debt now is vs when I took the loan out.

They have now responded saying because I have defaulted they are entitled to claim for the original sum borrowed plus all interest and fees and my defence is likely to fail so it is in my interest to withdraw the defence as if they ask for it to be struck off the costs will be added to the claim.

There is a paragraph in the letter that confuses me as I thought it was not allowed, it reads as follows:

'On or around 10 October 2022 you were provided with a Loan by Creation Consumer Finance Limited ("Our Client") for the sum of £7,500.00 with an interest rate of 9.9% and "front loaded" interest, with a payment term of 60 months ("the Loan"). This means that the interest was applied to the account in its entirety, and you would be entitled to a refund of the interest in the event that you repaid the Loan early.'

It's the part regarding the front loading of interest, I am guessing it is totally irrelevant now due to where I am with the account but I am curios if I can use it to my advantage in some way now?

What should I do at this point? They are refusing my offer of payment saying I can't afford it based on the information I gave them and have sent out an Income and Expenditure but am I obliged to give them the information or can I refuse?

Ideally I don't want a CCJ and I am a homeowner with my husband with a large amount of equity, I only say this as Creation were very quick in saying they wanted to obtain a charging order against the family home.

Any help or pointers would be fantastic!

Just to add some context to my situation I was working full time up until recently but I am now my Son's full time carer as he is disabled and requires me to be around 24/7.

Thanks Again!

sourcrates

If this has progressed to court, and you have no reasonable defence to the claim then a CCJ is automatic.

The interest issue has no relevance to the court claim, I assume they have supplied you with evidence of your liability, if its only a year old, that won`t be difficult.

Can you not agree a suitable repayment plan so that they stay the claim?

Sly72

I am currently in a battle with Creation / Equivo loan took out 2019 now defaulted and I was told by Equivo that Creation wants the debt amount paid within 3 yrs.

I explained this would be more than what I was paying before the default, I was told by Equivo that if I did not agree to this then CCJ and obtain charging order against the home would be the next stage, by creation.

But having seen Charging Order? The myth — MoneySavingExpert Forum that If your property is jointly owned a creditor will not be able to obtain a charging order against you, they can only get what is called a restriction.

I have told Equivo what I can afford but to date have not had anything back, when I get the letter to say they will not accept then I may use the FCA guidance of:

A firm must not threaten to commence court action, including an application for a charging order or (in Scotland) an inhibition or an order for sale, in order to pressurise a customer in default or arrears difficulties to pay more than they can reasonably afford.

CONC 7.3 Treatment of customers in default or arrears (including repossessions): lenders, owners and debt collectors - FCA Handbook

As sourcrates states” If this has progressed to court, and you have no reasonable defence to the claim then a CCJ is automatic” I would suggest sending the court info on what you can afford and let them make the decision on what to pay which Creation / Equivo will have to accept.

Sly72

Well looks like no one else can advise!!.

Once my journey has been sorted out  Iwill update so folk know what to expect.

tksnota

Sly72 said:

Well looks like no one else can advise!!.

Once my journey has been sorted out  Iwill update so folk know what to expect.

Hi,

I had the same situation with one of my creditors being Creation.

I hope you can share your updates 

Thanks

Sly72

tksnota said:

Sly72 said:

Well looks like no one else can advise!!.

Once my journey has been sorted out  Iwill update so folk know what to expect.

Hi,

I had the same situation with one of my creditors being Creation.

I hope you can share your updates 

Thanks

what stage are you at, I have sent them a SOA and an offer of payment in Nov 23 but to date no response. Under impression they have to go back to Creation for approval. When speaking with Equivo all that say is that their client that been "Creation" policy is it has to be paid off within 36 months, if I cannot afford that then CCJ action.

I have now written a complaint letter to "Creation" and asked under data protection guidance and why they went down this route with Equivo rather than sell the debit on which is an option they have advised in letters to me.

Sly72

UPDATE

I have submitted to Equivo what I can afford to pay which has been accepted, but Creation requires the balance paid within 3yrs that is around £115 a month, I am offering £75.

In the letter it states

“Whilst we have agreed with you how you will repay your outstanding balance, we need to make you aware that, as your offer of repayment does not clear the balance within the time frame our client considers reasonable, our client has instructed us to accept your monthly payment alongside legal action CCJ and Charging Order.”

Questions:

1.     If they proceed and I have already shown what I can afford will the courts accept the same?

2.     If they get a CCJ and Charging order I understand the court costs get added to my debt how much?

3.     I have seen that if a CCJ is granted then I get charged something about 8% interest per year, the debt is defaulted is this correct?

4.     Other debts I owe are accepting payments what I can afford and not taking this action. If a Request for a CCJ happens do others I owe debt to get informed of this as part of the proceedings?

fatbelly

So your offer pays the debt in 4.6 years. Most courts would see that as reasonable and award an instalment order on that basis.

Can a court grant a charging order on an undefaulted ccj?

From 2012 on, the answer is yes

https://www.nationaldebtline.org/fact-sheet-library/charging-orders-ew/

This is regarded as securing the debt, even if it isn't really doing that

Sly72

fatbelly said:

So your offer pays the debt in 4.6 years. Most courts would see that as reasonable and award an instalment order on that basis.

Can a court grant a charging order on an undefaulted ccj?

From 2012 on, the answer is yes

https://www.nationaldebtline.org/fact-sheet-library/charging-orders-ew/

This is regarded as securing the debt, even if it isn't really doing that

so can you advise:

2.     If they get a CCJ and Charging order I understand the court costs get added to my debt how much?

3.     I have seen that if a CCJ is granted then I get charged something about 8% interest per year, the debt is defaulted is this correct?

fatbelly

2. I don't know. A few hundred pounds?

3. There's no statutory interest on a CCA debt post- judgement

https://www.nationaldebtline.org/fact-sheet-library/interest-on-a-ccj-ew/

Sly72

fatbelly said:

2. I don't know. A few hundred pounds?

3. There's no statutory interest on a CCA debt post- judgement

https://www.nationaldebtline.org/fact-sheet-library/interest-on-a-ccj-ew/

Cheers as usual fatbelly always vaule your advice