Hi, can anyone tell me if my vehicle has been repossessed unlawfully?? I had a logbook loan with Loans 2 Go and last week at 6.50am Hermes Property Services Limited repossessed my car due to non payment. I wrote to Loans 2 Go on 22 August 2013 with regards to my financial circumstances, my ongoing mental illness and self harming issues. I explained thoroughly how this came to be and also enclosed a personal budget sheet and supporting documentation/letters from the medical professionals I see, namely my GP, Counsellor and Psychiatrist. When I called HPS Thursday afternoon, they confirmed that my letter had been received but to date, I have received no reply or acknowledgement what so ever. They also informed me that the fee as of 17 October 2013 that I would have to pay to get my vehicle back would be a total of £795.08, which includes £279.60 repossession charge, £24.00 to release the vehicle and £2.40 storage charge (which is applied daily) along with a 2.9% charge for making a payment with a debit/credit card. The last written correspondence I received from them was a Default Sum Notice served in compliance with section 86E of the Consumer Credit Act 1974 dated 6 September 2013, informing me of a £15.00 late payment charge. Have they acted unlawfully and not followed or adhered to certain guidelines put in place by the Consumer Credit Trade Association? I have never been provided with a copy of their official debt and mental health policy or your complaints procedure either Consumer Credit Trade Association Code of Practice SECTION 14 - DEALING WITH CUSTOMERS EXPERIENCING FINANCIAL DIFFICULTIES 14.1 Members shall ensure, by regularly examining their debt collection procedures and those of any third parties they employ, that they conform to high ethical standards and allow for proper consideration of the customer’s circumstances and in particular: (a) encourage customers in financial difficulties to inform them of their difficulties at the earliest possible moment (and members will endeavour to respond sympathetically, without prejudice to members’ rights) (b) provide in all relevant correspondence the name or title of a specially trained member of staff who may be contacted if difficulties arise © take into consideration, before determining whether to enforce an agreement, all information supplied by the customer or otherwise in relation to the cause of any default and the customer’s future ability to repay. If the customer has disclosed multiple debt problems, members shall inform the customer of the availability of advisory services. 14.2 Members shall, where appropriate, refer customers to debt counselling organisations and notify customers where they can get free advice, such as Citizens Advice Bureaux, Money Advice Centres, National Debtline, the Consumer Credit Counselling Service or Consumer Direct. Members will work with debt counselling organisations to assist their customers. 14.3 Members shall have due regard to the Debt Collection Guidance issued by the Office of Fair Trading and in particular shall not engage in any unfair business practices identified in that Guidance. 14.4 If a member passes a customer’s account to another person to collect overdue payments, such as a debt collector or solicitor, it will inform the customer. Members will always choose debt collection firms which agree to abide by the Credit Services Association Code or OFT Debt Collection Guidelines. ADDENDUM TO CCTA CODE OF PRACTICE PAYDAY AND SHORT TERM LOANS 6. Help for customers in financial difficulty If the customer is in financial difficulty, lenders will: > Deal with the customer sympathetically and positively and do what they can to help the customer manage what they owe. This may include making new arrangements about how the customer will pay off the debt. In doing so, the lender will consider other debts owed. > Freeze interest and charges if the customer makes repayments under a reasonable repayment plan or after a maximum of 60 days of non-payment. > Not contact the customer or take any action to recover the money owed for 30 days, if the customer is making a genuine effort to agree a repayment plan using either a debt-counselling organisation or a ‘selfhelp’ approach (for example, the customer is suggesting a repayment plan). If the customer or their adviser provide the lender with clear evidence that real progress is being made in reaching a repayment plan, but work has not yet concluded, the lender will extend this ‘breathing space’ for an additional 30 days. > Tell the customer about free and independent debt-counselling organisations. These include: Citizens Advice, the Consumer Credit Counselling Service, National Debtline or the Money Advice Service. > Not allow you to borrow further from the lender until all outstanding loanswith the lender have been repaid. > Deal with people whom the customer has asked to act on their behalf, with the customer’s authority, unless those people behave unreasonably. 9. Rigorous complaints procedures When the customer takes out a loan, the lender will tell them about their complaints-handling procedure. Lenders will do this: > in writing – at or immediately after the point of sale; > by giving the customer a copy of it, if asked to do so; and > by giving the customer a copy of it, if they send us a complaint. This information will also be available on the lender’s website or at theirbusiness premises, where appropriate. If the customer wants to make a complaint, they should contact the lender first using their complaints procedure. The lender will acknowledge the complaint within five days of it being received by the lender’s Complaints Department. If the lender needs to investigate the complaint further to respond fully, the lender will tell the customer and keep them regularly updated. If the customer wants to make a complaint to the trade association about the lender’s conduct under the Charter or this Addendum, the lender will give the customer their contact details. As a first step, the trade association will refer the complaint to the lender’s Chief Executive (or a nominated representative) who will make sure the lender investigates it and send a response to the customer. If the customer is still not satisfied, the trade association will try to help the customer reach an agreement up to the time the matter is resolved. The customer may also refer the complaint to the Financial Ombudsman Service and the lender will give the customer their details. Further information on how we deal with complaints is available in the industry Codes of Practice. CCTA GOOD PRACTICE CUSTOMER CHARTER PAYDAY AND SHORT TERM LOANS Key commitments by lenders: When providing payday or short-term loans, we will: > Act fairly, reasonably and responsibly in all our dealings with you. > Not pressurise you to enter into any loan agreement or to extend (‘roll over’) the term of your existing loan agreement. > Tell you that a payday or short-term loan should be used for short-term financial needs and is not appropriate for long-term borrowing or if you are in financial difficulty. > Tell you how the loan works and the total cost of the loan (including an example of the price for each £100 borrowed, together with fees and charges) before you apply. > Check whether the loan is suitable for you taking account of your circumstances. > Carry out a sound, proper and appropriate affordability assessment and credit vetting for each loan application and before the loan is extended (rolled over), to check you can afford the loan. > Explain in general terms what types of information we will consider in making a decision, if you ask us to. > Explain how we will communicate with you during the term of the loan, how payments will be deducted from your bank account and how you can contact us by phone, email or online. > Set out clearly how continuous payment authority works (if we use it) and your rights to cancel this authority, so you can decide if this type of repayment is acceptable to you. We will remind you that if you cancel, you will still owe any outstanding debt and will need to provide an alternative method of repayment on the due date to avoid going into default. > Always notify you by email, text, letter or phone at least 3 days(1) before attempting to recover payment using continuous payment authority on the due date. This notice will ask you to contact us if you are in financial difficulty and cannot repay. THE LENDING CODE Help if you are experiencing financial difficulties Each organisation that follows the code is committed to acting sympathetically and positively if you are experiencing financial difficulties. Contact your lender as soon as you think you will experience financial difficulties and they will work with you to overcome them. This will include: • considering stopping asking for repayments from you for at least 30 days to allow you time to get advice or present a repayment plan; • making sure your repayments leave you with enough money to meet reasonable day-to-day living expenses; • considering reducing or suspending interest and charges if these would cause the debt to increase or lead to the repayment term becoming too extended; and • considering accepting token repayments (a small amount you can afford) until your situation improves. If you owe money to a number of lenders, independent money advice may be recommended. At the end of this guide there is a list of organisations that provide free advice. If you have any mental or physical health issues that affect your ability to repay your debts, you should let you lender know so they can make appropriate arrangements. Debt collection OFT guidance for businesses engaged in the recovery of consumer credit debts July 2003 (updated November 2012) SECTION 2 - OVERARCHING PRINCIPLES OF FAIR BUSINESS PRACTICE 2.1 In the OFT's view, there are a number of overarching principles of consumer protection and fair business practice which apply to all debt recovery activities. 2.2 In general terms, businesses should: • treat debtors fairly – debtors should not be subjected to aggressive practices, inappropriate coercion, or conduct which is deceitful, oppressive, unfair or improper, whether unlawful or not • be transparent in their dealings with debtors and others – information provided should be clear and should not be confusing or misleading • exercise forbearance and consideration, in particular towards debtors experiencing difficulty – we would expect businesses to work with debtors with a view to providing them with reasonable time and opportunity to repay debts and, where appropriate, to signpost them to sources of free independent debt advice • act proportionately when seeking to recover debts, taking into account debtors' circumstances – actions taken in respect of arrears or default should give proper consideration to available options and the likely effect of such actions on the debtor • establish and implement clear, effective and appropriate policies and procedures for engaging with debtors and other relevant parties, including having appropriate mechanisms for responding to reasonably queried and disputed debt and (other) complaints • establish and implement clear, appropriate and effective policies and procedures for identifying and dealing with particularly vulnerable debtors. Most debtors may be regarded as 'vulnerable', to some degree, by virtue of their financial circumstances. Of these, some may be, permanently or temporarily, rendered particularly vulnerable by virtue of the fact that they are significantly constrained in terms of their ability to engage appropriately with those pursuing them for the repayment of debts owed. Debtors with mental health issues and/or with mental capacity limitations (amongst other types of actually or potentially particularly vulnerable individuals) may fall into this category. Physical/psychological harassment 3.7 r. failing to suspend the pursuit of recovery of a debt under circumstances in which it is understood37that the debtor might not have the mental capacity to make relevant decisions regarding the management of the debt and/or to engage in the debt recovery process at that time. Deceptive and/or unfair methods 3.9 M (ii) using the CPA in a manner which is unreasonable or disproportionate or excessive in failing to have proper regard to the possibility that a debtor is in financial difficulties and the consequent need for forbearance For example: • seeking payment before income or other funds may reasonably be expected to reach the account • seeking payment where there is reason to believe that there are insufficient funds in the account or that this would leave insufficient funds for priority debts or other essential living expenses • continuing to use the CPA after the debtor has informed the creditor, or the latter has otherwise become aware, that the debtor is in financial difficulties and cannot afford to repay • continuing to use the CPA for an unreasonable period after the due date without taking steps to establish the reason(s) for the payment failure • seeking part payment before reasonable attempts to collect in full on the due date have been made. Whether use of a CPA is reasonable and proportionate, and not excessive (as regards the frequency or period of collection attempts), will depend upon the circumstances, including whether there may be evidence of actual or potential financial difficulty and whether the debtor has been notified of the failure to collect and has responded to contact from the creditor. The OFT would expect creditors to exercise appropriate forbearance where there is evidence to suggest that the debtor is, or may be, experiencing financial difficulties. If the creditor is unable to recover the whole of the due amount by the end of the next business day after the due date, the OFT would generally regard this as indicating the possibility of financial difficulty. We would generally therefore expect the creditor to suspend use of the CPA until reasonable efforts to contact the debtor to establish the reason(s) for the payment failure and whether the debtor may be in financial difficulties have been made (unless this has already been done subsequent to the initial payment failure). If the parties have agreed an alternative payment date, as a fallback if the full payment is not available on the due date, we would generally expect the creditor to suspend use of the CPA after the due date, and again after the alternative payment date (if the creditor is unable to recover the due amount by the end of that day), and make reasonable efforts to contact the debtor as above. If there is evidence of financial difficulty, we would expect the creditor to reassess the position with a view to agreeing a revised payment schedule or alternative repayment arrangements where appropriate. If reasonable efforts to contact the debtor are unsuccessful or the debtor refuses to engage (and there is no further evidence of financial difficulty), any subsequent use of the CPA should be reasonable and not excessive with due regard to the possibility that an unresponsive debtor may nevertheless be in financial difficulties and that a debtor not in financial difficulties at the time of contact may subsequently be in financial difficulties. If attempts to recover payment continue to fail, we would expect the creditor to make periodic further reasonable attempts at contact, at reasonable intervals, to establish whether the debtor may be in financial difficulties. What is ‘reasonable’ will depend upon all the circumstances including information the creditor has on the debtor’s position, the result of previous contact attempts and the period over which payment attempts have been unsuccessful. Part payments should be sought only following reasonable efforts to collect in full on the due date and having regard to the possibility that the debtor is in financial difficulties. Attempts at part payment, where used and whether successful or not, should be reasonable in number bearing in mind the possibility of such difficulties. For example, if part payment is taken to avoid a debtor incurring a default charge, we would generally expect that only one such payment would be required for this. Debt collection visits 3.13 Examples of unfair or improper practices are: b. visiting a debtor at a time when it is understood or suspected that he is, or may be, particularly vulnerable I note that the OFT expects businesses engaging in debt recovery activities to have regard to The Money Advice Liaison Group's (MALG) voluntary guidelines for best practice in the management of debt; for consumers with mental health problems and debt, which I do not believe they have done. They have also not taken into account The Briefing for Creditors and Debt Collection Agencies by The Royal Collage of Psychiatrists and the Money Advice Trust on Debt Collection and Mental Health; ten steps to improve recovery. Their own Bill of Sale states that “If you have a material change of circumstances we will take this into consideration and may agree to reduce your repayments until such time as you are able to continue with your contractual repayments”. I do not feel this has been done. Yesterday I received a Default Sum Notice served in Compliance with section 86E of the Consumer Credit Act 1974 with a repossession charge for £279.60, four days after the vehicle was seized.