Can American Express continue to do this?

cheexy

Andyjflet said:

cheexy said:

I wrote a letter to American Express back in January of this year regarding my very difficult financial situation. The letter included my budget document from Step Change. I never got any response from them but instead continued to receive letters as though they hadn't heard anything from me. I then sent two additional emails to the email address they provided to be contacted on, in the letters they sent me. No response. The debt was about  £14,400. My problem is that in addition to not acknowledging any of my communication, they have continued to add over £400 monthly to the initial debt which has now been passed to a law firm. This has added an additional whooping £2000+ on to the debt. I have no way of paying this debt as I don't work due to my newborn. I only receive Universal Credit which barely covers my priority bills so I occasionally get help from family. I also had my outstanding energy bill recently cleared by British Gas Grant.

I have other credit card debts and those companies have stopped applying interest since I reached out to them. 

Are American Express not being irresponsible in the way they have continued to ignore my communication? Is there a remedy to this? Any advice on next steps would be appreciated.

Playing devils advocate they could argue that having a child doesn't preclude you from paying your debts. Most banks have huge backlogs to deal with so they will be working through the pile of letters. Call them up and discuss but they will ask how you are going to pay your debt back. When did you stop spending on AE knowing you were having a baby with no future income? 

I lost my source of income unexpectedly so I did not stop paying AE knowing I was having a baby.

cheexy

sourcrates said:

Just let it go to debt collection, and deal with whoever writes to you, that`s usually a much simpler solution than trying to contact someone who does not want to be contacted.

I intend to reply the law firm this week following the guide provided in my previous thread but I was thinking I could also put in a formal complaint with American Express because of the lack of response and the additional £2000+ they have added on these past 5 months. It is such an exorbitant amount and I am just wondering what the end goal is with the silence and adding so much interest. How long can they possibly continue doing this? Is there no guideline for responsible lending I can reference considering that other providers responded promptly and went on to freeze interest especially after I was the one who reached out to them.

MattMattMattUK

cheexy said:

sourcrates said:

Just let it go to debt collection, and deal with whoever writes to you, that`s usually a much simpler solution than trying to contact someone who does not want to be contacted.

I intend to reply the law firm this week following the guide provided in my previous thread but I was thinking I could also put in a formal complaint with American Express because of the lack of response and the additional £2000+ they have added on these past 5 months. 

You have no grounds for a complaint. You are the one in breach of contract and so the penalties apply.

cheexy said:
It is such an exorbitant amount and I am just wondering what the end goal is with the silence and adding so much interest. How long can they possibly continue doing this? 

They add interest at their contractual rate which is 30-40% depending on the card, then penalty fees and debt recovery fees are also listed in the contract. The late payment fee is £12, but what you are now facing is debt recovery fees. As the debt is over £10k it will not be allocated to the small claims track so their costs are recoverable, that is the route they will probably go down. Amex usually go for a CCJ and then likely a charging order. They can continue until they it goes to court when the interest would become statutory interest of 8%.

sourcrates

You can`t not pay your account, then complain when they have added interest to it, those are the terms you signed up to after all.

The best way to deal with this is not to go in all guns blazing, although that approach is appropriate sometimes, just not on this occasion, wait and deal with the collector, and then further down the road, after the debt has been sold maybe more than once, you can probably settle the debt for less than the outstanding balance.

That way you offset the interest added at the beginning, its all about knowing your enemy.

cheexy

sourcrates said:

You can`t not pay your account, then complain when they have added interest to it, those are the terms you signed up to after all.

The best way to deal with this is not to go in all guns blazing, although that approach is appropriate sometimes, just not on this occasion, wait and deal with the collector, and then further down the road, after the debt has been sold maybe more than once, you can probably settle the debt for less than the outstanding balance.

That way you offset the interest added at the beginning, its all about knowing your enemy.

Many thanks for your very helpful answer. I was thinking more around complaining about the lack of response these past 5 months. I felt like I was getting deliberately ignored just so that more interest can be added on. The law firm have already threatened legal action as it stands. I'm just drowning and looking for any way out.

DullGreyGuy

cheexy said:

sourcrates said:

Just let it go to debt collection, and deal with whoever writes to you, that`s usually a much simpler solution than trying to contact someone who does not want to be contacted.

I intend to reply the law firm this week following the guide provided in my previous thread but I was thinking I could also put in a formal complaint with American Express because of the lack of response and the additional £2000+ they have added on these past 5 months. It is such an exorbitant amount and I am just wondering what the end goal is with the silence and adding so much interest. How long can they possibly continue doing this? Is there no guideline for responsible lending I can reference considering that other providers responded promptly and went on to freeze interest especially after I was the one who reached out to them.

So your complaint is that they have applied the interest and fees you agreed to when you took out the card? How do you expect that to go honestly?

You do have grounds for complaint that communications have been ignored but thats a token £25 compensation at best. 

AmEx are a particular company and dont aim at the full spectrum of peoples and maybe are less sympathetic than those that intend to deal with all types. Your likely to get more response from the third party 

MattMattMattUK

cheexy said:

sourcrates said:

You can`t not pay your account, then complain when they have added interest to it, those are the terms you signed up to after all.

The best way to deal with this is not to go in all guns blazing, although that approach is appropriate sometimes, just not on this occasion, wait and deal with the collector, and then further down the road, after the debt has been sold maybe more than once, you can probably settle the debt for less than the outstanding balance.

That way you offset the interest added at the beginning, its all about knowing your enemy.

Many thanks for your very helpful answer. I was thinking more around complaining about the lack of response these past 5 months. I felt like I was getting deliberately ignored just so that more interest can be added on. The law firm have already threatened legal action as it stands.

Amex rarely sell debts in the same way most other card providers do, the tend to go legal, get a CCJ and then they may get charging order and sell that on afterwards. As others have said Amex are by far the least forgiving card provider when it comes to non-payment, they target themselves at a segment with low default rates and tend to go in hard when people do not keep up their contractual payments. To put it bluntly they are not going to let you just walk away, especially as you have a property that they can get a chunk of.

cheexy said:
I'm just drowning and looking for any way out.

I would say that at this point in time you need to look at getting back to work as soon as possible, you probably also need to look at selling your house and downsizing to something you can realistically afford. When asked on previous threads I notice you have also dodged the question of whether the father of your child is contributing, if they are not then you need to enforce that via CMS.

RAS

MattMattMattUK said:

Amex rarely sell debts in the same way most other card providers do, the tend to go legal, get a CCJ and then they may get charging order and sell that on afterwards. As others have said Amex are by far the least forgiving card provider when it comes to non-payment, they target themselves at a segment with low default rates and tend to go in hard when people do not keep up their contractual payments. To put it bluntly they are not going to let you just walk away, especially as you have a property that they can get a chunk off.

The bitter part is you'll probably end up with a CCJ to repay a tiny amount each month, or charging order.

The silver lining is that in order to take legal action, Amex have to issue a default first. At that point they should stop applying interest.

MattMattMattUK

RAS said:

MattMattMattUK said:

Amex rarely sell debts in the same way most other card providers do, the tend to go legal, get a CCJ and then they may get charging order and sell that on afterwards. As others have said Amex are by far the least forgiving card provider when it comes to non-payment, they target themselves at a segment with low default rates and tend to go in hard when people do not keep up their contractual payments. To put it bluntly they are not going to let you just walk away, especially as you have a property that they can get a chunk off.

The bitter part is you'll probably end up with a CCJ to repay a tiny amount each month, or charging order.

The silver lining is that in order to take legal action, Amex have to issue a default first. At that point they should stop applying interest.

At the point they default, which with Amex is usually the the month following the third missed payment, they will stop charging contractual interest. They then start charging the statutory 8% interest as soon as the CCJ is issued, so whilst the rate certainly does drop from their normal 30-40% range they are also one of the least forgiving companies to owe money to. 

Andyjflet

cheexy said:

Andyjflet said:

cheexy said:

I wrote a letter to American Express back in January of this year regarding my very difficult financial situation. The letter included my budget document from Step Change. I never got any response from them but instead continued to receive letters as though they hadn't heard anything from me. I then sent two additional emails to the email address they provided to be contacted on, in the letters they sent me. No response. The debt was about  £14,400. My problem is that in addition to not acknowledging any of my communication, they have continued to add over £400 monthly to the initial debt which has now been passed to a law firm. This has added an additional whooping £2000+ on to the debt. I have no way of paying this debt as I don't work due to my newborn. I only receive Universal Credit which barely covers my priority bills so I occasionally get help from family. I also had my outstanding energy bill recently cleared by British Gas Grant.

I have other credit card debts and those companies have stopped applying interest since I reached out to them. 

Are American Express not being irresponsible in the way they have continued to ignore my communication? Is there a remedy to this? Any advice on next steps would be appreciated.

Playing devils advocate they could argue that having a child doesn't preclude you from paying your debts. Most banks have huge backlogs to deal with so they will be working through the pile of letters. Call them up and discuss but they will ask how you are going to pay your debt back. When did you stop spending on AE knowing you were having a baby with no future income? 

I lost my source of income unexpectedly so I did not stop paying AE knowing I was having a baby.

My error, just the way your post read.