I do apologise for my earlier comments about peterbard. Clearly he is more interested in triviality than helping consumers in need and engaging in any meangingful analytical debate about the issues. I obviosuly mis-judged his character enourmously on the basis of his seemingly genuine intention to help consumers and am grateful to him for demonstrating his true character for everyone to see.

The total charge for credit, however, is not a prescribed term. Therefore, the courts take is basically that a determining factor of a prescribed term cannot be dependent on the construction of the Total charge for credit, which is not a prescribed term, as parliament would not have intended the weight of a prescribed term to be undermined by the effect of an unprescribed term. There is a growing school of thought, however, that non-prescribed term can also be the basis of a successful challenge for unenforceablility, but no case has come forward on that issue yes.

Therefore, a fixed sum credit agreement for a fixed rate of interest AND a fixed sum credit agreement for a variable rate of interest both require the rate of interest to be stated under regulation 6 and schedule 6 when you consider the exceptions of Schedule 1 paragraph 9, becuase of the way in which © has been written. If you read Wilson and Walker, the Court of Appeal and Supreme Court both spend a lot of time on the question of total charge for credit and painted themselves into a corner with their judgments. You need to relate the relevant regulation to the interpretation by the leading cases, and as far as I understand them and have had them explained to me, interest is, and always has been, a prescribed term in a fixed sum loan and for running account credit, whether or not the rate is fixed or variable.

Peterbard – Regulation 6 and Schedule 6 contain the prescribed terms that apply. Schedule 6(4) states that a rate of interest is a prescribed term in relation to: (a) running-account credit; and (b) fixed-sum credit falling within the exceptions in paragraph 9(a) to © of Schedule 1 to these Regulations Paragraph 9(a) to © of Schedule 1 states: (a) which do not specify either the intervals between repayments or the amounts of repayments or both the intervals and the amounts (b) under which the total amount payable by the debtor to discharge his indebtedness in respect of the amount of credit provided may vary according to any formula specified in the agreement having effect by reference to movements in the level of any index or to any other factor; © which provide for a variation of, or permit the creditor to vary, (whether or not by reference to any index) the amount or rate of any item included in the total charge for credit after the relevant date; So, I am saying that where there is a fixed sum loan agreement for a fixed rate of interest the interest rate is a prescribed term under regulation 6, schedule 6, and you are saying it is not because it falls within one of the (a) –©, as I understand it. (a) relates to agreements where there are no periodic payments, the full amount plus interest falls due at a future date, most fixed sum agreements have monthly payments, so it is not this exception. (b) Relates to an index-linked variable rate. We are talking about a fixed rate, so this exception does not apply (indeed, there are few if no index linked rated agreements that consumers have) © This exception relates to the amount or rate of any item included in the total charge for credit. The total charge for credit is made up of 1. Interest, 2. Charges. 3. Interest on charges. So, on a fixed sum, fixed rate loan agreement, if the is a charge, like a broker fee, that is variable, or interest on a charge, that is variable, the exception applies. The exception has nothing to do with the interest rate itself being variable as it relates to items included in the total charge for credit NOT “the” total charge for credit. Have a look at both the Court of Appeal and Supreme Court judgments on Walker, and also Wilson. So this exception does not apply to a fixed rate loan for a fixed (or variable) rate of interest, unless a component included in the total charge for credit (i.e. a charge or fee or interest on a charge or fee) is itself variable.

That's right gh2008. The trick is understanding which calculations apply. If you are challenging a regulated credit agreement that is pre-April 2007, but post May 2005 then there will be a difference when compared to a pre-May 2005 because of when different regulations relating to claculations came into force. However, the calculation for the effective rate of interest is: The effective monthly rate is the annual rate "R" when calculated thus: Effective Monthly Rate =((R+1)^(1/12))-1 The calculation for the nominal/simple rate of interest is: The Nominal monthly rate is the Nominal Annual Rate divided by 12 Therefore, if a credit agreement states: "The interest rate is 6.9% this is the effective rate of interest" you apply the forumla to determine what the effective monthly rate is. If it states "The interest rate is 6.9% this is the nominal or standard rate of interest" you just divide it by 12 to get the monthly rate. Once you know what the monthly rate actually is, you can apply it across the amount of credit in a spreadsheet and work out whether the total charge for credit stated is correct, or whether the rate stated in a statment is correct. Its pretty cool, and sending accurate calculations in reams of spreadsheets and asking the lender to tell you you are wrong is great fun, as more often than not, they cannot argue with the maths!! BUT the maths must be pretty wrong, as you say, the variance is relatively wide ;-D

This is not "new law" this is "the law". Also, you need to bear in mind that there are dozens and dozens of sets of regulations. If you have access to Goode's encylopedia then take a look at chapter 9, regulations. You will see dozens and dozens of statutory intstruments, ranging from how to calculate interest to what the total charge for credit must contain. Francis Benion also has a good website with links to these, but it is a massive maze, and as a 9 year qualified senior lawyer, working with the teams and barristers who took most of the leading cases to court in 2009/10, it was a struggle to get around it all. I am trying to give you an accurate signpost to help you successfully play the game, becuase we can only win if we stand up for ourselves and play the game!

Honestly, I am not mistaken. I have spoken to the leading lawyers, QCs, judges and Mr Benion (he is a great character). The interest rate really really is a prescribed term in fixed sum loans and running account credit. The schedules in the regulations merely show what is a prescribed term or not. The key is Regulation 2: [2 Form and content of regulated consumer credit agreements][(1) Subject to paragraphs (2) and (9) below, documents embodying regulated consumer credit agreements (other than modifying agreements) shall contain the information set out in Column 2 of Schedule 1 to these Regulations in so far as it relates to the type of agreement referred to in Column 1. (2) Where any information about financial and related particulars set out in paragraphs 9 to 11 of Schedule 1 to these Regulations cannot be exactly ascertained by the creditor, estimated information based on the assumptions referred to in paragraph 10 of that Schedule, where applicable, and otherwise such assumptions as the creditor may reasonably make in all the circumstances of the case and a statement of the assumptions made shall be included in documents embodying regulated consumer credit agreements. (3) Subject to paragraph (9) below, documents embodying regulated consumer credit agreements, other than agreements of the description specified in the Schedule to the Consumer Credit (Notices of Cancellation Rights) (Exemptions) Regulations 1983 in relation to which there are no charges forming part of the total charge for credit (in this regulation referred to as "exempted agreements"), shall contain statements of the protection and remedies available to debtors under the Act, in the Form numbered in Column 1 of Part 1 of Schedule 2 to these Regulations and set out in Column 3, in so far as they relate to the type of agreement referred to in Column 2. The cases of Wilson, Walker, McGuffick, Carey ALL confirm what the prescribed terms are under the 1983 regulations and the interest rate is one of them. Honest!

peterbard - you seem like a knowledgeable intelligent person. Have a look at the 1983 regulations and the schedules in them about what the prescribed terms are. You will see that the APR is not a prescribed term, but the interest rate is. There is a complexity though: the interest stated in the agreement could be either the "effective" rate or the"nominal" rate. Basically the effective rate is the same as the APR. There were a bunch of cases at the start of the year based on agreements which showed an APR of 6.9% and an interest rate of 6.9%. The argument was that the interest rate must be wrong because it cannot be the same as the APR. A lot cases were won with this argument until the lenders got infront of a judge and pointed out that the effective interest rate is the same as the APR. The agreement MUST state the interest rate. If it states the APR (ie. APR 6.9%) but does not state the interest rate, it IS unenforceable. If it does not state the APR then it could be unenforceable, but is unlikely to succeed in court. Some agreements state "This is the effective rate" or "this is the nominal rate". I built a calculator based on the calcualtions in the regulations as to how the APR/effective rate is actually calculated. This helps, as it is possible to look at the terms of the agreement in relation to the rate as a nominal AND as an effective rate, to determine whether or not it is right or wrong or within rounding tolerances. It took me about 7 months to get my head around it all, but I have been practising for two and half years. The rules are complex and the lenders will DO ANYTHING to prevent you exercising your lawful rights, and the lower courts are too scared to apply the law properly. If there is mis-sold PPI this can affect the prescribed terms, since it affects the amount of the loan, the amount of monthly payments and the rate of interest, so a good PPI should lead to unenforceability on any one of the three main prescribed terms. The other thing that affects interest rates is whether charges have been added to the loan or are treated as part of the loan and whether the same or different interest rates apply.

Okay, I have been reading this thread. I need to correct some points made. Firstly any loan for a fixed sum must show : 1. The Interest Rate; 2. The amount of regular payments 3. The term; 4. The amount of interest paid. These are basic prescribed terms. It is NOT the case that a loan does not need to state an interest rate - the interest rate is a material prescribed term. If the rate is not stated this is a breach and the agreement is unenforceable. if the rate is incorrectly stated, but within the tolerance for rounding (e.g. 5.76% is stated as 5.7 or 5.75 or 5.8) it is likely compliant - if the rate stated is outside of tolerance (e.g. 5.75% is stated as 6% or 5%) it is not correct. If an interest rate is incorrectly stated you can challenge the agreement. Everyone needs to hold thier ground. Consumers are winning. Winning cases quietly, by settlement under confidentiality agreements. A judge cannot change the law, he can only interpret and apply it. A loan or credit card agreement that does not state an interest rate cannot be enforced as it not properly executed because it is missing a prescribed term. That's it. It has always been this. The courts are trying to limit the damage on lenders now that the tax man underwites them (i.e. you). This does not mean that the courts are not applying the law, it means that you have to play the game and stick to your guns. If a judge says an agreement with no interest rate, or an interest rate that is way wrong beyond the rounding tolerances, he is wrong and you can appeal. The next court up will have more experienced judges who know the law and will apply it. Lower courts have less experienced judges, so dont be afraid to appeal. I have successfully challenged loans, credit cards and bank charges and am working on the mortgage. Its a game. Learn to play the game and you can win. The game is this: 1. Is the default notice valid - (if it isnt, they cant proceed anyway) 2. If it is, have they produced a compliant s.77/78 agreement (after the Carey case this MUST be either: A. where the original terms have not been varied at all - either a copy of the original or a reconstruction of the original togehter with a statement of the current balance, or B. Where the original terms have been varied (such as a credit card) an exact copy of the original agreement in its original form together with the current terms and a statement showing the current balance (these are words from the judgement). If they have not produced A or B, they are in breach of s.77/78 and cannot proceed. 3. If they have complied with s.77/78 does the agreement contain ALL the prescribed terms? If any ONE prescribed term is missing or mis-stated beyond the rounding tolerance, it is not properly stated. 4. If the prescribed terms are correct have they applied those terms? Check the original statments - if a credit card statement shows a monthly rate of interest which does not equate the annual rate stated in the agreement they are in breach of contract and you can ask them to appoint an accountant to recalculate the entire balance from day 1, which will cost them several thousand pounds. 5. If everything is in order and they have applied the agreement correctly, who is suing you - is it the original lender or someone else? If its someone else what basis are they suing you? Is there a deed of assignment? If so were you properly served with notice of assignment. 6. If they pass all the above then you are screwed. Also - never, ever admit you owe any money or make any payments once they have served a default notice (unless you care about your credit rating and can afford to) as each payment restarts the 6 year limitation period for them to sue you. The consumer forum is full of success stories, but you really need to read every thread from scratch and follow the links. There is a greate thread about defective default notices and how you can challenge them suing you. I know you have other worries and pressures, and to be honest, claims management companies got screwed like the rest of us, becuase the banks tied up all the key cases in court and let them go bust. Hold your ground, dont give in, play the game, follow the rules and you WILL win, I did.

I have a basic bank account with Nationwide. I have no overdraft, no cheque book and no debit card. I have never gone overdrawn on the account. Between September 2008 and May 2010 I had £960 in charges for unpaid direct debits. They consistently rely on the Supremem Court judgment in the "overdraft bank charges" case - and even state on their website that the case relates to overdrafts. I have argued that as I have no overdraft nor gone overdrawn ever, that they cannot rely on a case about overdrafts in relation to an account with no overdraft. They ignored my arguments. I have issued at County Court for £1047 plus costs and am awaiting to find out if they will defend. As far as I am concerned, no services have been provided, the T&Cs refer to "additional administration costs" of which there are none, Nationwide has suffered no loss and the charges are punitive as they are a penalty - I have a barrister freind who is happy to represent me at Court as well. I really dont see how they (or any lender) can be allowed to do this. Basically telling Company A - "we wont pay the direct debit" and then charging £30 to me - especially when the system is automated . I am confident that I will recover the full amount, but the fact that they wont listen and are happy to wait for court proceedings is unacceptable. The truth is that all banks are doing the same thing to everyone. They wont listen, they dont care. They just want to take as much money off everyone as possible - which they do upfront - and pay back as little as possillbe - which they do months/years later (in the hope that people will give up). Until people start collectively shifting away from banks and opting for alternative solutions the banks will continue to do this and profit from it, at our expense. This is a disgrace, but its the way the world works. Only by standing firm and having patience can we recover money from them - but by then they have levered that money and made 10 times as much from it anyway, so they cant loose! I also had trouble switching to Natwest, and was declined. There was talk of a right to a bank account, but until it happens we are stuck with Nationwide. By the way, as an account holder you are a shareholder with membership rights in Nationwide, so it may be worth considering looking at what those rights actually are, and the general duties a company owes to its shareholders, as there may be something in there that can help your cause.

I recently had C L Finance taking action against me to enforce debt that I had originally disputed. The original lender, GE Money (now Santander) failed to comply with the original s.78 request and this was my defence. Rather than go to court, they agreed to a consent order which included writing off the debt and reversing all negative entries on my credit file. I also previously forced Santander to write off a credit card completely. Because of their conduct, the FOS is also investigating them for unfair business practices, and the Information Commissioner for breach of the Data Protection Act (by failing to send accurate information to credit reference agencies - i.e. that there was a dispute). I have been practising this area of law for a while now, but the strategy of the banks generally appears to have been successfull. This is because a lot of claims management companies and law firms who had tens of thousands of viable claims, had no funding to take claims into litigation. This lack of funding has starved the market and let the banks off the hook. If any funding for claims does become available it will not be sufficient to cover everyone, so many will lose out. However, if there is a PPI element, then these have been deemed in the indistry as stronger cases and some funding is available for those. People need to stand their ground and wait for the lender to bring action within 6 years or write the debt off. If they bring action then defending an action does not require funding in the same way as bringing one, so is a stronger position to take them on from. Everyone at CAG hang in there, and remind others that the truth is that most agreements can be challenged successfully, but patience is needed.

Yes, I have. Its due to the credit agreement being irredeemably unenforceable - it only really works with agreements taken out before April 2007, as the law changed under the Consumer Credit Act 2006. The old law (that is, the law pre-april 2007) applies to credit agreements taken out before Apruil 2007 - basically, if the credit agreement is flawed, the law says it is not properly executed and this means it cannot be enforced - the process involves litigation that takes several months to obtain a "declaration of unenforceability" from the Court - best part is the Court has no choice where the breaches are of "prescribed" terms. The banks are being very underhanded with a negative pr campaign about claims management companies - fair enough, there are some dodgy ones out there (look out for creditcardkiller.com - and stay well away from their service its a rip off), but there are plenty of regulated genuine ones out there. In my case there was a fee for an audit of the credit agreement and then the claim is on a no win no fee basis, so the bank pays your legal fees as part of the claim. I have around 80k of unsecured debt that I am in the process of challenging. Interestingly though, I stopped paying them months ago and they have never brought any court action against me - I imagine this is because I have written and verbally told them that the debt is in dispute and the OFT guidance on unfair business practices states clearly that it is an unfair practice to ignore a borrower who says the debt is in dispute - guess what, if the debt is in dispute the lender cant enforce it - its the law. Fantastic!