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    • 22Jens21
    • By 22Jens21 13th Mar 18, 3:47 PM
    • 14Posts
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    22Jens21
    Fending off a default before it happens
    • #1
    • 13th Mar 18, 3:47 PM
    Fending off a default before it happens 13th Mar 18 at 3:47 PM
    I have already posted part of this over on the Credit File forum and the lovely people there told me that there are some real-life debt ninja’s over here in the DFW forum and to post here too…

    Can you help me with a few sage things to say in reply to a Lloyds bank saga that’s been rumbling on for about 16 years?

    I took out an aggressively-sold loan and full PPI with Lloyds back in the early 2000’s. I had no hope of meeting the repayments over the full life of the loan, so after struggling with it for a couple of years I wrote to Lloyds asking to renegotiate. I was treated horrendously by an account manager and had to eventually complain to the Chairman’s office. Finally, in 2005, the loan was fully renegotiated, the PPI removed and refunded, part of the loan written down and the remaining balance was set up as a current account with no charges or fees, just a negative balance of the outstanding amount which was to accrue no interest.
    I offered to pay £100 per month, which I honoured for several years.

    Poor circumstances some time later then meant I had to approach them to ask for a repayment holiday. They did not respond. I didn’t make payments for several years, during which time they did not contact me at all.

    Eventually in 2015 they wrote and asked if I could resume payments. The letter was quite polite, made no reference to the loan maturing, and contained no threat of any action of any kind.

    I said I could manage £40pm. Again they did not respond.
    I have been paying the offered £40pm into the account ever since (over three years).

    The account was never defaulted, nor sold on, and eventually, due to extreme old age, stopped appearing on my credit file at all.

    In January of this year Lloyds wrote to me, entitling their letter ‘default loan’ and laid out the fact that the loan is past maturity (which it is - if I’d paid £100pm, it would have been settled in 2015).

    I wrote back saying I’d be willing to up the payment when I can. Their response has been to send me a ‘Letter of Concern’ and again have entitled it ‘default loan’.

    They’ve given me 14 days to respond.

    I asked a question over in the credit file forum about whether they can re-list this account on my credit file in order to lodge a default against me. It seems they can.

    I don’t think I meet the traditional criteria for a default – I’ve answered all their letters, have been making regular payments for the last three years and so on – but clearly, as is always the case with the big banks, the advantage lies with them. If they do lodge a default, that casts a six year shadow over my whole life. I can’t have that.

    Better to tread gently and make sure they don’t default the account in the first place.

    So, I can (just) manage to up the payments back to the £100 per month level of the original agreement. But I want to make a strong case that £100 per month is completely fair and any further action / default against me would be punitive.

    QUESTIONS:
    What do I have on my side? Surely, SURELY they should have taken action sooner than this if the account was a problem? Doesn’t their complete inaction in the past count for something? (They are very lucky I responded to them in 2015 - if I'd known about 'statute barring' I might not have said a word...).
    I want them to accept the £100pm, leave me alone and stop threatening my financial future (not unreasonable IMHO!).
    How do you think I should frame the offer in order to achieve that?

    Any help gratefully received ~ thank you.
Page 1
  • National Debtline
    • #2
    • 13th Mar 18, 4:07 PM
    • #2
    • 13th Mar 18, 4:07 PM
    Hi there


    Are you positive that no default was ever registered on your credit file? A debt should be removed 6 years after the date of a default. Or if there was no default, a settled account will be removed 6 years after the account was closed. I'm unsure why the account would have been removed if neither of these things happened.


    Certainly you wouldn't normally expect a debt that has been removed to be added back on again. And a default is supposed to be registered when the relationship between you and the creditor breaks down, and this is generally when the arrears are between 3 and 6 months. Even they were to add a default at such a late stage you could put a complaint in, and take that on to the Information Commissioner's Office if necessary www.ico.org.uk.


    With regards to the letter being titled default loan, they are probably just referring to the fact that you have not been paying the contractual amount or the term has expired. Did they acknowledge the amount you have offered to pay? And did you send them a statement of affairs (SOA)? If they can see your income and outgoings, and that your offer is reasonable, they are more likely to accept.


    Susie
    @natdebtline
    We work as money advisers for National Debtline and have specific permission from MSE to post to try to help those in debt. Read more information on National Debtline in MSE's Debt Problems: What to do and where to get help guide. If you find you're struggling with debt and need further help try our online advice tool My Money Steps
    • 22Jens21
    • By 22Jens21 13th Mar 18, 4:13 PM
    • 14 Posts
    • 0 Thanks
    22Jens21
    • #3
    • 13th Mar 18, 4:13 PM
    • #3
    • 13th Mar 18, 4:13 PM
    Thank you Susie - I really appreciate your help.

    There seem to be a lot of anomalies on this account - strange behaviour by the bank and it's definitely fallen off all my credit files - I've checked all three - but was never defaulted and is far from settled. Curious.

    I'll go back to then with a solid offer to return to the 'full' £100pm payments and will be firm about that being fair.

    Thank you so much again for taking the time to help me.
    • sourcrates
    • By sourcrates 13th Mar 18, 4:30 PM
    • 14,011 Posts
    • 13,265 Thanks
    sourcrates
    • #4
    • 13th Mar 18, 4:30 PM
    • #4
    • 13th Mar 18, 4:30 PM
    Send a CCA request to Lloyds.

    I bet they will not be able to comply.

    https://www.nationaldebtline.org/EW/sampleletters/Pages/Information-about-your-agreement-under-the-Consumer-Credit-Act-%28sole-name%29.aspx
    Last edited by sourcrates; 13-03-2018 at 4:32 PM.
    I'm a Board Guide on the Debt-Free Wannabe, Credit File And Ratings, and
    Bankruptcy And Living With It, boards. "I volunteer to help get your forum questions answered and keep the forum running smoothly".
    Board guides are not moderators and don't read every post. If you spot an abusive or illegal post then please report it to forumteam@moneysavingexpert.com. Any views are mine and not the official line of MoneySavingExpert.com.

    For free debt advice, contact either : Stepchange, National Debtline, or, CAB.
    For Free Legal advice see : http://legalbeagles.info/
    • 22Jens21
    • By 22Jens21 13th Mar 18, 4:45 PM
    • 14 Posts
    • 0 Thanks
    22Jens21
    • #5
    • 13th Mar 18, 4:45 PM
    • #5
    • 13th Mar 18, 4:45 PM
    Will do sourcrates - that's inspired.

    Much appreciated
    • 22Jens21
    • By 22Jens21 6th Apr 18, 4:13 PM
    • 14 Posts
    • 0 Thanks
    22Jens21
    • #6
    • 6th Apr 18, 4:13 PM
    • #6
    • 6th Apr 18, 4:13 PM
    I took sourcrates's advice and sent off a CCA. But what I've got back is weird.

    They've sent a letter that states "Unfortunately we're not currently able to trace our copy of the original loan agreement. We're not obliged to retain our records indefinitely." They go into a massive amount of detail about OFT guidelines and their (Lloyds's) responsibilities. They then state that to "fulfil our obligation under the Act, I have enclosed a specimen copy of the loan agreement enabling you to be fully informed about the legally binding contract between us. We do not require you to pay the £1 fee so I am returning your postal order with this letter".

    And what they've sent? I'm not making this up. Is clearly some else's loan agreement, with the name, address, amount of loan, APR, length of loan, arrangement fees, date and signature etc. all blacked out with thick marker pen.
    It has no personal information on it at all.
    It looks like it might unenforceable, correct? But... although the loan is ancient and has been on reduced payments for years, it's never been registered as a default, so I have to tread very carefully.

    What would be your next move?
    Thanks!
    • sourcrates
    • By sourcrates 6th Apr 18, 6:13 PM
    • 14,011 Posts
    • 13,265 Thanks
    sourcrates
    • #7
    • 6th Apr 18, 6:13 PM
    • #7
    • 6th Apr 18, 6:13 PM
    From 16 years ago the copy agreement they send you should also contain the prescribed terms applicable to that account, what it appears they have "attempted" to do, is to send you a reconstituted version of what you would of signed, this is not acceptable for an account pre-dating April 2007, and is likely, in my opinion, to be unenforceable.

    A letter containing these facts should now be sent winging its way to Lloyd's.
    Last edited by sourcrates; 06-04-2018 at 6:36 PM.
    I'm a Board Guide on the Debt-Free Wannabe, Credit File And Ratings, and
    Bankruptcy And Living With It, boards. "I volunteer to help get your forum questions answered and keep the forum running smoothly".
    Board guides are not moderators and don't read every post. If you spot an abusive or illegal post then please report it to forumteam@moneysavingexpert.com. Any views are mine and not the official line of MoneySavingExpert.com.

    For free debt advice, contact either : Stepchange, National Debtline, or, CAB.
    For Free Legal advice see : http://legalbeagles.info/
    • 22Jens21
    • By 22Jens21 6th Apr 18, 6:19 PM
    • 14 Posts
    • 0 Thanks
    22Jens21
    • #8
    • 6th Apr 18, 6:19 PM
    • #8
    • 6th Apr 18, 6:19 PM
    Thank you sourcrates - much appreciated.
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