BBL from Lloyds now in the hands of Moorcroft

Mivvi-69

Hi. I'm a newbie here so please be gentle! My son took out a BBL with Lloyds. Before it was due to be repaid Lloyds closed his account  and transferred the administration of the loan to Moorcroft. Lloyds have refused to say why they did that and we can't get any sense out of Moorcroft either. My son complained to the ombudsman and was told Loyds have done nothing wrong and they are at liberty to close accounts as they see fit and transfer debts (which it wasn't at the time) as they wish. This is not on his credit file and we cannot find out who owns the debt, however he is paying an amount agreed with Moorcroft, he has never missed any payments and still receiving statements from Lloyds bank for the account. Now he is applying for a mortgage and the lender wants to know why this is a debt and why Lloyds closed the account and handed it to Moorcroft. Help! has anyone else been in this situation, has any advice for us, we feel stuck in a never ending hamster wheel which isnt of our own making, thanks.

retiredbanker1

SAR them (although any details about wrong doing on the part of your son will be redacted).
Are you saying that Lloyds closed all of his accounts not just this loan?

What grounds did he apply for the BBL? What were the funds used for?

sourcrates

Sometimes Banks make commercial decisions to pass management of a debt to a collector, they can do this at their discretion and do not need to provide a reason why.

The debt will still be owned by Lloyds, Moorcroft will have been assigned it to manage.

If the debt had been sold you would have been informed in writing beforehand.

Just tell the mortgage company it was a commercial decision made by Lloyds to which you were not a party.

Hoenir

Was your son challenged on the validity of the BBL by Lloyds prior to the account being closed?  What happened to the funds drawn down? 

Grumpy_chap

Mivvi-69 said:

Hi. I'm a newbie here so please be gentle! My son took out a BBL with Lloyds. Before it was due to be repaid Lloyds closed his account  and transferred the administration of the loan to Moorcroft. Lloyds have refused to say why they did that and we can't get any sense out of Moorcroft either. My son complained to the ombudsman and was told Loyds have done nothing wrong and they are at liberty to close accounts as they see fit and transfer debts (which it wasn't at the time) as they wish. This is not on his credit file and we cannot find out who owns the debt, however he is paying an amount agreed with Moorcroft, he has never missed any payments and still receiving statements from Lloyds bank for the account. Now he is applying for a mortgage and the lender wants to know why this is a debt and why Lloyds closed the account and handed it to Moorcroft. Help! has anyone else been in this situation, has any advice for us, we feel stuck in a never ending hamster wheel which isnt of our own making, thanks.

It is possible that not all the facts are here, or there has been some misunderstanding.

The son took out a BBLS during COVID.
Was the son trading and fully compliant with the rules of BBLS at that time?
Was it only the BBLS account which was closed?  That is now only a debt.
Have Moorcroft bought the debt from Lloyds, or simply undertaking the administration functions on an outsourced basis?
Is the sone still trading in the same form of business as when the BBLS was first taken?
I am confused by the comments "it wasn't a debt" - what else is a loan?
Was the debt (loan) declared when the son made the mortgage application?

Mivvi-69

Thanks for all your comments. I can confirm that all the circumstance are as I posted yesterday and all correct protocols as to the use of the loan were followed, and yes it was declared on the mortgage application. Please note that the loan was handed over to Moorcroft 3 months before any payments were due. I do believe that Lloyds handed the adminstration of repayments on these BBL's over to Moorcroft as a purely business/admin decision, however any lender seeing a payment to a debt collection agency on bank statements rings alarm bells, and Lloyds either can't or won't give a satisfactory reason. I was hoping someone may be able to suggest a way out of this predicament or may have experienced the same. BTw what is a SAR? Thank you

Grumpy_chap

SAR = Subject Access Request.

I am unclear as to the timelines for the loan being transferred to Moorcroft as you say "3 months before any payments were due".  
Presumably the BBLS was originally drawn in 2020 and, if I recall correctly, had an initial 12-months before it needed repayment.  The rules evolved so payment breaks were permitted plus an extension to the repayment period.

Are you saying the admin transferring to Moorcroft was some years back?  That would make sense that Lloyds (and other banks) had a swathe of loans, with different rules to the majority of their commercial loans, and a finite life-cycle.  Rather than the bank creating internal processes to manage a different set of rules, using an outsource provider that is experienced at working with different loans under different rules probably makes good commercial sense.

Mivvi-69

Yes, the loan admin was transfered to Moorcroft before the initial year was up. Payments were not yet due. Moorcroft treated it as a loan that had been defaulted on, but it hadn't as payments were not due. They wanted financial declarations and deemed that it was not financial possible to pay back the complete load as was offered by my son, so a repayment plan was actioned. He was assured this would not be a 'bad debt'on his credit file and indeed it isnt, and Moorcroft are clearly only collecting the money on Lloyds behalf as her receives monthly statements from Lloyds. However as I said before to a lender this appears that he defaulted on the original loan, which is incorrect. sorry as this is a ll a bit long winded. 

Hoenir

What remains unanswered is why Lloyds called in the loan. Your son is the only person who can answer that question.  We are only hearing part of the story. 

Grumpy_chap

Hoenir said:

What remains unanswered is why Lloyds called in the loan. Your son is the only person who can answer that question.  We are only hearing part of the story. 

It is not clear to me that Lloyds have called in the loan.

Hoenir

Grumpy_chap said:

Hoenir said:

What remains unanswered is why Lloyds called in the loan. Your son is the only person who can answer that question.  We are only hearing part of the story. 

It is not clear to me that Lloyds have called in the loan.

Scheduled repayments under the terms of the loan weren't due though at the time that the matter was passed to Moorcroft. Correspondence exists.