Are any companies using the Date of Default to trick people?

DisabledDan

Hi all

In light of the following sticky on Limitations Act and Date of Default

https://forums.moneysavingexpert.com/discussion/6027755/statute-barred-debts-and-the-limitation-act#latest

My understanding of the above sticky is that the six year limitation for SOME credit providers with the appropriate terms, mean that the six years of the Limitations Act runs from the date of default and not the last payment.

My first question is whether there are any companies who are not issuing a data of default but just passing the debt to debt collectors to chase without the formal default process?

My second question is whether there a register of defaults and their dates, I do not mean the debt being in default as far as a credit reference database, I mean that the debt has been put into default and sold to a debt collection company?

Thanks for your input.

sourcrates

The date that limitation commences is the date specified in the "default notice for payment of the arrears" which may or may not also be the date of default. 

This was deemed to be the "cause of action" date by a 2019 Court of Appeal ruling.

However there is nothing to stop you using the argument that the last payment or written acknowledgement date, was the "cause of action" date, if the account either did not default or the date of default is unknown, or you can just base it on the FCA guidance of between 3/6 missed contractual payments, and workout the potential default date from that..

The answer to your first question is yes, to an extent, they can only recover arrears by this method, in order to collect the full balance or to commence legal action against you the terms and conditions of your agreement have to be broken and a standard default notice must be issued and not complied with, leading to the account being defaulted.

There is no register of defaults, a default notice is a "one time sent" item, and is separate from the default that is registered on your credit report.
Individual companies may keep internal records but there is no public register as such.

DisabledDan

Thanks @sourcrates

The reason I have asked is that is I recently stuck all my debt letters in a file, in date order, the debt got passed to a new Debt Recovery company around every 3 to 6 months.

For some of them it was easy to see the default notice and later for the debt to be assigned (i.e. sold) to a new firm, e.g. Robinson Way > Hoist > Lowell and so on.

So for for most of my debt they issued a default notice and I counted from that year

Some added fake fees but these were removed when they passed the debt to a new firm to chase.

Some deducted small amounts as if payments had been made,

However one firm sent nothing, at least I can't trace a single request for the money owed, not from them nor from any debt collector.  .
I did get a CCJ but I incorrectly assigned it to the lowest debt because of the amount, that debt started of with one law firm that specialises in debt getting a back door CCJ. It was at a very old address, so missed by redirection of mail, I only found out about it after the law firm came after me at my then current address.  Then two years later another apparently unrelated debt law firm started chasing the debt.  They tried tactics like a pre-filled warrant of control which finally told me who actually got the CCJ, which was not the original credit card. 

I have seen other examples online of the original credit card company not chasing the debt and of the same claimant getting a CCJ.

I don't have the date of the original CCJ, but I imagine it would have been at least 6 years ago as the debt is probably 11 or 12 years old based on the dates of the letters from the debt law firms.

I don't know if they ever sought an extension to the CCJ, I am on the credit reference databases for my energy and Lowell waste money chasing Statute Barred Debt that never had a CCJ so I would have expected to hear from firm that got the CCJ, but nothing since that last fake warrant of control many years ago.  Funny thing is I did not even realise it was fake until I filed all my debt letters in a ring binder and sorted them by debt and then by date. I also did not realise which debt it was until I found my old long expired credit cards and one DebtSol letter had the reference number of the card.

sourcrates said:

The answer to your first question is yes, to an extent, they can only recover arrears by this method, in order to collect the full balance or to commence legal action against you the terms and conditions of your agreement have to be broken and a standard default notice must be issued and not complied with, leading to the account being defaulted.

sourcrates

Debt collectors/debt purchasers are well known for underhand collection practices.

That has never been in any doubt, they will say or do anything to get money out of you, especially on the phone, things they would never dare put into writing.

The issue is lack of proper regulation for this kind of infringement, the FCA only act in extreme circumstances, but when they do crack down they do so hard, think 1st Credit/Motormile finance, both had a root and branch re-branding, change of management structure, better training for call handlers, change of name, and a massive fine.

There has also been recent updated guidance on the collection of statute barred debts, although it appears they are still being chased as before in a lot of cases, so keep watching on that one.

DisabledDan

sourcrates said:

Debt collectors/debt purchasers are well known for underhand collection practices.

That has never been in any doubt, they will say or do anything to get money out of you, especially on the phone, things they would never dare put into writing.

The issue is lack of proper regulation for this kind of infringement, the FCA only act in extreme circumstances, but when they do crack down they do so hard, think 1st Credit/Motormile finance, both had a root and branch re-branding, change of management structure, better training for call handlers, change of name, and a massive fine.

There has also been recent updated guidance on the collection of statute barred debts, although it appears they are still being chased as before in a lot of cases, so keep watching on that one.

Thanks @sourcrates

You are not kidding, everywhere I go online I see questions about collecting statute barred debt, I also see allegations of fake payments (one wonders if the reps themselves make these as they are usually between £2 and £3.

Also allegations of a CCJ having been obtained when there is no CCJ according to Registry Trust and when an SAR is completed no evidence of a CCJ so they were lying.


 

RAS

One issue is that people panic when dealing with debt collectors.  Seen too much trash TV, bailiffs at the door, shame, guilt, dread of new financial chaos and hardship.

Collector, you have a debt for £x incurred on a Timmytoes card (legally correct in England)
Human : That would be statute barred even if it was mine. (legally correct but inexact in England)
Collector  Not if there's a CCJ issued against it (correct only if less than 6 years have passed since the CCJ was issued).

Human's brain fills in the dots to create a nightmare picture.  Now nowhere did the Collector say that there was a recent enough CCJ issued against this debt but that comment is designed to undermine the human's confidence in the situation and create doubt.

The comment may be legally compliant, but its chosen to create the opportunity to extract payment.

It's a bit like "People say". Who said, when, in what circumstances? It's easy to conflate what one irrelevant person said once upon a time, with when someone relevant said something supportive of that view last month,  and the whole world fully believes this fact. It's what a lot of social media and politics rely. 

DisabledDan

You are spot on @RAS, on the TV programmes they simply want to pressure what you care about and get you to make the mistake of letting them in or letting them gain entry.

It is interesting watching those programmes on YouTube and seeing video evidence of the tactics which break the law and even the the bluster. 

"let me in so we can discuss it and come to an arrangement"

Failing to mention that letting them in once means you have to let an HCEO in future and that they will add £800 to your bill to make a list of the dross assets

Collector: I have put a warrant of control notice on your car, I now control that car.
Human: I noticed that, but isn't it true that the car has to be worth more than the cost of towing and 7 days storage (£2000), which the creditor must pay you before you will tow that car.  Also the car is not mine, not taxed, without MOT and not worth sixpence, in fact it has been written off. 
Collector: Well I will have to take control of that other car and threaten you with that.
Human: What the one that is on lease with a disabled badge.
Collector: I hate you.

I noticed during the pandemic that 5 personality types seemed to emerge, when I listen to talk radio callers I can usually detect which one they are regardless of the issue under discussion.

The HCEO Goons did pay me a visit but I did not engage with them, they got bored, very frustrated.and left.