Please help - paying off a "forgotten" debt!

xine111

I have just requested my Credit Files from Experian, Equifax and Callcredit.

Unfortunately I have discovered an old Barclaycard debt from 2004 that I had completely forgotten about. At the time I was going through a really bad patch health-wise (treatment for depression and eating disorders) and moved back in with my parents, I had lots of other financial problems at this time and in the midst of paying everyone else off and ensuring that all banks/credit card companies had my new details, I forgot about Barclaycard. (I did have a bank account with Barclays at the time, and informed them of my change of address but Barclaycard were never informed).

The debt was recorded as a Default Account by Barclaycard and passed on to another company (HFO Services Ltd) who also recorded a Default Account in December 2005. I do not have any CCJs regarding this debt on my Credit History - so I assume this is as far as it went. I have not received any communication or statements regarding this account since 2004.

No-one has contacted me from Barclaycard, but I don't want to bury my head in the sand until 2012 when the debt should "drop off" my credit file! I would like to take steps to sort this out now, although I can't afford to pay the total amount in one go (£1197) I'd like to start paying it off in installments. However, I'm scared of initiating contact with Barclaycard/ HFO Services Ltd as I'm scared that once I do they will demand the money back in one go.

Has anyone else been in a similar situation, and can offer me advice on how to go about this?

Donedoingdebt

If the account was defaulted in 2004 by Barclaycard then HFO should not have re-defaulted the same account. You should be able to get this removed by contacting the CRAs. However, as you've stated earlier, this may set the wheels in motion for some debt recovery action by the creditor/DCA.
If they do start chasing the debt & they can prove they own it, they may well initially demand you pay it in one go.
You should then send them realistic proposals for repayment (only what you can afford) in writing & stick to your offer no matter how much they try & pressurise you. Eventually, they're likely to agree, as a small amount each month is better than none at all.

xine111

Thanks for that advice! Could you possibly point me in the direction of any written rules that state the account should not have been re-defaulted? The CRAs websites are confusing to say the least!

Do you know if there is any way to find out who "owns" the debt at the moment without provoking a deluge of debt collectors?

I was thinking of writing to Barclaycard with a repayment proposal. I can afford to pay off quite a big chunk of the debt per month (around £250) but I can't clear it all in one go. If the debt is no longer handled by them, hopefully they will be able to put me in touch with whoever is looking after it *crosses fingers*

fermi

xine267 wrote: »

Thanks for that advice! Could you possibly point me in the direction of any written rules that state the account should not have been re-defaulted? The CRAs websites are confusing to say the least!

You should only have one default/record for each debt.

How the original default is updated depends on whether the collection company is acting on behalf of the creditor or have bought the debt.

In either case though, it is only the original default that can be updated to show the new owner of the debt or any payments.

They are not permitted to change the date of the default, or issue another one.

The Information Commissioner has this to say.:

From: http://www.ico.gov.uk/upload/documents/library/data_protection/detailed_specialist_guides/default_tgn_version_v3%20%20doc.pdf

When ‘in collection’

30. Where debts are passed for collection to internal or external debt collection departments or agents, the lender is responsible for keeping the record of the default and any outstanding balance accurate and up to date. The lender will need to make sure that those responsible for collection report payments to them or directly to the agency (or both) to make sure internal records and those of the credit reference agency are kept up to date. The account record on the agency file should continue to show the name of the lender and not any outside collection agent. This situation is to be distinguished from that where debts are assigned or sold to debt collectors. The sale or assignment of debts is dealt with at paragraphs 52 to 54.

The ‘sale’ or assignment of debts on defaulted accounts

52 When the rights to a debt are sold to a third party, the lender has to make sure the records with the credit reference agency are accurate, up to date and adequate. If they want information about the debts to continue on the credit reference file they will need to come to an agreement with the purchaser about who is to be responsible for this.

53 If the purchaser agrees to take control of the record, the customer should be informed that the debt has been sold or assigned and to whom. The credit reference agency file should be changed to show the name of the purchaser and that the rights to the debt have been sold or assigned.

The purchaser should then make sure the record is kept up to date including changes to the amount still owed. The purchase should not affect how long the record is kept. It should be removed six years after the default.

54 Where the purchaser of the debt does not agree to take control of the record, the original lender, and at least in part the credit reference agency, will remain responsible if the original record is kept on the file. When the debt is sold or assigned, the customer will no longer owe any money to the original lender. If the record is not removed, the sale or assignment should be recorded and the balance should be shown as zero. The customer should still be told who the debt has been sold or assigned to.

xine111

Thank you!

That is hugely helpful, I am going to write to the CRAs today to get the "duplicate" debt removed from my file.

I'm also writing to Barclaycard to hopefully negotiate a repayment schedule for this debt.

rog2

xine267 wrote: »

I'm also writing to Barclaycard to hopefully negotiate a repayment schedule for this debt.

Why not have a look at the National Debtline website;

http://www.nationaldebtline.co.uk/england_wales/debt_advice.php

They have some excellent 'template letters' that you could use when trying to negociate with Barclaycard.

Good luck

xine111

That website is really helpful, there are some great template letters on there and the Personal Budget planner is also fantastic!