About to start my claim - but advice first please

[Lurcherlady]

I've gathered my info and am doing my schedule of charges to claim but just before I learnt I could do this I had to come to an arrangement with the bank to convert my overdraft to a managed loan whereby I pay a set amount each month with a facility to pay more as and when I can afford to. I had to do this so that I could use the account without the money I put in being swallowed up into the overdraft. When I finally get the excess overdraft penalty charges paid back by the bank will they just take it before I can get to it to pay off the overdraft/loan? My claim will be for around £1600 and the overdraft/laon is for £1200 and I would estimate that around half of this is made up of excess overdraft penalty charges (£475 in just the last 4 months!!). When I get the money back I've no intention of paying off the whole of this overdraft/loan and most of it is penalty charges but it might be tricky tracking back to see when it first went over the agreed limit but I'll have to negotiate a sum to pay back because I certainly used the overdraft facility exceeded the limit in the first place to generate the penalty charges.

 

I'd be grateful if anybody has got any advice/experience/opinion to offer on best course of action to take.

Thanks

Lurcherlady

[Lurcherlady]

Hi

I'm surprised no-one had an opinion on my question (repeated below) or experience of similar situation. Please somebody chip in, I really need benefit of your experience.

 

I've gathered my info and am doing my schedule of charges to claim but just before I learnt I could do this I had to come to an arrangement with the bank to convert my overdraft to a managed loan whereby I pay a set amount each month with a facility to pay more as and when I can afford to. I had to do this so that I could use the account without the money I put in being swallowed up into the overdraft. When I finally get the excess overdraft penalty charges paid back by the bank will they just take it before I can get to it to pay off the overdraft/loan? My claim will be for around £1600 and the overdraft/laon is for £1200 and I would estimate that around half of this is made up of excess overdraft penalty charges (£475 in just the last 4 months!!). When I get the money back I've no intention of paying off the whole of this overdraft/loan and most of it is penalty charges but it might be tricky tracking back to see when it first went over the agreed limit but I'll have to negotiate a sum to pay back because I certainly used the overdraft facility exceeded the limit in the first place to generate the penalty charges.

 

I'd be grateful if anybody has got any advice/experience/opinion to offer on best course of action to take.

 

Many thanks

[callumsgran]

Hiya, soorry nobody's answered before! if its a loan they cant make you pay it back with your proceeds. its a separate agreement, presumably they made you sign a new agreement yes?

[laura22andrews]

Hi,

 

I would imagine the bank would deduct the amount you owe them from the bank charges they refund. If there is a lot of charges included in what you owe, this will also be refunded so they just deduct the outstanding amount of overdraft. You statements should tell you when you first went over the agreed limit, if longer than six years ago, you should ask the bank when you first went over the limit. You shouldn't negiotiate any sum that you should pay back, because the point of this is the charges are unlawful, and you should just pay back what you owe, excluding all charges.

 

Hope this helps, not very experienced, just my own opinion. But im sure soneone will be along soon to give you expert advice.

 

Regards,

Laura

[callumsgran]

You could always ask them to pay you back by cheque and pay it into another account, they just might do it!

[Lurcherlady]

Thanks for the replies. I'll bear in mind asking for refund as a cheque.

What to pay back is going to be tricky as over the past 6 years my overdraft limit has been £150 then £300 then £500 and during this time I have been in and out of overdraft, sometimes within the limit sometimes over the agreed limit and sometimes even in credit - and sometimes for two or three straight months, not just the beginning of the month after getting paid! They wouldn't agree to isolate the overdraft amount with no interest so I could pay it back they had to make it into a loan and add £383 interest!! I know this is a bit previous as I haven't put in my claim yet but I want to be prepared. Should I go back through my statements to the last one where I ended the month within my overdraft limit and from then on add the excess penalty charges and take them away from the loan amount (less the interest figure) and tell them I'll pay only that amount back? What do you think.

 

Any thoughts/opinions gratefully received. Thanks

[lookinforinfo]

This question crops up on this forum from time to time. As I understand it, if you get to Court then you can specify that you want to be paid by cheque-see this url

 

PRACTICE DIRECTION --- OFFERS TO SETTLE AND PAYMENTS INTO COURT -- This Practice Direction supplements CPR Part 36

under paragraph 8.4 you will see "Subject to paragraph 8.5(1) and (2), if a party does not wish the payment to be transmitted into his bank account or if he does not have a bank account, he may send a written request to the Accountant-General for the payment to be made to him by cheque.

 

 

Should your bank offer to settle out of Court, then make it one of the conditions

of the settlement that you want to be paid by cheque, or you will continue your

action. As the banks do not want to go to Court, you have them over a barrel.

[Lurcherlady]

Thanks, lookinforinfo, for advice about paying by cheque. I might just do that as we also have a joint business account with an overdraft facility and I wouldn't want them to think they could take my refund for that!!

[ppauls150]

Lookingforinfo i am not following you around by the way i just came across this thread like you have and was going to give the same advice. If you end up going to court then make it one of the settlements that you get paid by cheque. I think like what someone else said that i think a current account and a loan account are two different agreements and should never be tied togther so they shouldn't really be allowed to offset one against the other if you have money in one of the other accounts. NOTE> if you do end up settling out of court then please proceed with caution and make sure you negociate with them on the terms and conditions, dont jump in head first cause they are offering you a refund. You are the one in control on how things should proceed not them and if your unhappy tell them that it will have to be decided in court, i am sure that they will soon change their mind. Maybe it is worth having a look at my thread that i have going at the minute as this is has happened to me but it seems like we might be coming to an final outcome and it might help you avoid the problems i have encountered.

DG Solictors. Need Help

Regards

Paul.

P.S If you found this info useful please click on the scales in the top right hand corner

[callumsgran]

thanks lookin and ppauls for your replyies, very informative! as my sig says im not an expert but i do try to keep informed! good luck lurcherlady!

[Janet-M]

Threads merged , please do not start a new thread , if you do not recieve a reply after a day then bump your thread by adding a new post saying 'bump' if you still do not recieve an answer after giving ample time then please PM a moderator or site helper .Hope this helps

[lookinforinfo]

No offence taken PPauls150, and I hope that those who do read your thread will also take from it the fact that you don't have to accept what the legal people tell you. By his continued actions and refusal to accept what they said, he received

a better deal. A lesson to us all.

[caughtfortoolong]

No advice to give. this is my first visit to this site. Am intrigued and have ended up here after pushing the reply button. good luck with your claims.

[Lurcherlady]

Thanks to all for replies, I will bear all advice in mind to keep all money in my pocket. Thanks to moderators for putting me right on list etiquette. Let you know what happens.

[Lurcherlady]

At last, finally got it together to send prelim letter yesterday! On line confirmation it has been delivered. Claiming £1422.50. Will also be taking up the question of the Managed Loan they made me convert my overdraft into just before I discovered I could claim back charges - first payment on Managed Loan is due 20th of this month.

 

Having 6 years statements all together I noticed something that, unfortunately, I didn't notice at the time. Up to Feb 2004 my overdraft limit was £150, in March I increased it to £300, In September 2004, without consultation or my knowledge or agreement, it was put back down to £150 (probably some stupid typo) but it resulted in my being within the £300 overdraft limit at closing balance Sept 04 and way over the £150 overdraft limit overnight at opening balance on next statement. It stayed at £150 (stupidly without my noticing it) until June 05 when I increased it to £500!!!!! I pointed this out to them very strongly stating I believe this has directly contributed to today's situation of being forced to convert overdraft to Managed Loan. So we'll see what the rotters have to say!! Will keep you posted.

[Lurcherlady]

Hi All

I really need the benefit of all your collective experience and knowledge

Prelim letter sent 13 July, claiming £1422.50 - no word at all from HSBC so sent LBA dated 1 August which crossed in post in post with letter from Colin Langdale also of 1 August offering £1250 - not a bad offer except he totally ignored the notes attached to my schedule regarding Managed Loan I was 'persuaded' into in June - only made one payment so far - so most of it is penalty charges the bank are now agreeing to refund to me. I have written back to Colin Langdale and I set out below extract from that letter as it sets out position:

 

 

Thank you for your letter of 1 August (which has crossed with my Letter Before Action also of 1 August) offering me £1250 refund of bank charges against my claim of £1422.50.

Whilst I appreciate this offer I am inclined to pursue the full claim, but before accepting or rejecting it, I would like to make the following points and ask for your comment.

• In June 2006 my overdraft limit was £500 and my balance at 3 June 2006 was £1158.76 overdrawn.

• Since July 2005, the last time a statement showed a closing balance within my overdraft limit, the penalty charges added to my account amount to £830.

• In June 2006 I was 'persuaded' to convert the overdraft into a Managed Loan of £1200 plus £383.89 interest. The majority of this loan is made up of penalty charges that you have agreed to refund.

• This Managed Loan will obviously have to be re-thought and I would not like to accept or reject any offer until this matter is addressed.

• I would like to draw your attention to the notes that accompanied my schedule of charges, and to which you haven't referred, detailing the mistake the bank made on my statement in September 2004, as follows:

• My statements run from 3rd of the month to 3rd of next mont
  
• Closing balance on 3rd September was £261.21 overdrawn but within the limit of the £300 agreed overdraft
  
• My opening balance on the next statement at 3rd September 2004 was £261.21 overdrawn but the overdraft limit at the top of the statement was shown as £150, therefore overnight I went from being within my overdraft limit to £110.21 above the shown overdraft limit thus putting me in the position of incurring penalty charges. This was done without consultation or my knowledge or agreement and was unfortunately un-noticed by myself at the time. This continued until June 2005 when I increased the limit to £500.

• This mistake directly contributed to the very high penalty charges being applied to my account and preventing me from catching up and staying within the agreed limit.

I'm wondering if he will take any notice of this letter. Will he stall so that the 10 days he's given me to accept the offer runs out, and he'll hope I won't proceed to court action? Should I e-mail or ring and ask, have you received and what about it, or what?

Hope someone will tell me best thing to do.

Cheers

[Lurcherlady]

BUMP! BUMP! BUMP!

 

Repeating my message of yesterday so that someone can please, please advise how to handle accepting the offer and negotiating reduction/cancellation of the Managed Loan because I'm certainly not going to pay back the charges in the Managed Loan with the money they refund for the very same charges.

 

Yesterday's message repeated below:

 

Hi All

I really need the benefit of all your collective experience and knowledge

 

Prelim letter sent 13 July, claiming £1422.50 - no word at all from HSBC so sent LBA dated 1 August which crossed in post in post with letter from Colin Langdale also of 1 August offering £1250 - not a bad offer except he totally ignored the notes attached to my schedule regarding Managed Loan I was 'persuaded' into in June - only made one payment so far - so most of it is penalty charges the bank are now agreeing to refund to me. I have written back to Colin Langdale and I set out below extract from that letter as it sets out position:

 

 

Thank you for your letter of 1 August (which has crossed with my Letter Before Action also of 1 August) offering me £1250 refund of bank charges against my claim of £1422.50.

 

Whilst I appreciate this offer I am inclined to pursue the full claim, but before accepting or rejecting it, I would like to make the following points and ask for your comment.

• In June 2006 my overdraft limit was £500 and my balance at 3 June 2006 was £1158.76 overdrawn.

• Since July 2005, the last time a statement showed a closing balance within my overdraft limit, the penalty charges added to my account amount to £830.

• In June 2006 I was 'persuaded' to convert the overdraft into a Managed Loan of £1200 plus £383.89 interest. The majority of this loan is made up of penalty charges that you have agreed to refund.

• This Managed Loan will obviously have to be re-thought and I would not like to accept or reject any offer until this matter is addressed.

• I would like to draw your attention to the notes that accompanied my schedule of charges, and to which you haven't referred, detailing the mistake the bank made on my statement in September 2004, as follows:

• • My statements run from 3rd of the month to 3rd of next mont
    
  • Closing balance on 3rd September was £261.21 overdrawn but within the limit of the £300 agreed overdraft
    
  • My opening balance on the next statement at 3rd September 2004 was £261.21 overdrawn but the overdraft limit at the top of the statement was shown as £150, therefore overnight I went from being within my overdraft limit to £110.21 above the shown overdraft limit thus putting me in the position of incurring penalty charges. This was done without consultation or my knowledge or agreement and was unfortunately un-noticed by myself at the time. This continued until June 2005 when I increased the limit to £500.

• • This mistake directly contributed to the very high penalty charges being applied to my account and preventing me from catching up and staying within the agreed limit.

I'm wondering if he will take any notice of this letter. Will he stall so that the 10 days he's given me to accept the offer runs out, and he'll hope I won't proceed to court action? Should I e-mail or ring and ask, have you received and what about it, or what?

 

Hope someone will tell me best thing to do.

Cheers

[Janet-M]

We will get back to you on this shortly

[Lurcherlady]

Thanks, mjanet, look forward to hearing

Lurcherlady

[jonni2bad]

Hi

 

Before offering my opinion, could you possibly just clarify things briefly regarding the sums of money involved, and the contents of the Prelim/LBA please?

 

At the start date of the 'managed loan', what were the level of charges you had already incurred?

 

How much was the loan for?

 

Since taking out the loan, how much extra in charges have you incurred?

 

Have you been able to assess the overdraft interest caused solely by the charges, and if so, what were they at the loan start date and since then?

 

In terms of the letters you have already sent, what reference did they make to the loan? Can you copy and paste for us?

 

Thanks

jonni2bad

[Lurcherlady]

Hi jonni2bad

 

Thanks for reply. Answers to questions as follows:

 

 

At the start date of the 'managed loan', what were the level of charges you had already incurred?

 

My agreed overdraft limit was £500 and I my balance was £1158.76

 

How much was the loan for?

 

Loan was for £1200 plus £383.89 interest 12.1%. It was arranged in June and first payment was 20 July 2006 - so have only made one payment so far.

 

Since taking out the loan, how much extra in charges have you incurred?

 

None. They stopped the charges that would have been added for June/July.

 

Have you been able to assess the overdraft interest caused solely by the charges, and if so, what were they at the loan start date and since then?

 

I didn't include the interest in my claim due to difficulty in correct calculation.

 

In terms of the letters you have already sent, what reference did they make to the loan? Can you copy and paste for us?

 

I attached some notes to the schedule of charges as follows:

 

NOTES

 

1. I have not included interest on penalty charges due to the complexity of

correct calculation.

2. Having obtained my statements for the last 6 years and on looking through

them I notice that my overdraft limit was £150 up to February 2004. In

March 2004 it was increased to £300. In September 2004, quite

inexplicably and without consultation or my knowledge or agreement, and

unfortunately un-noticed by myself at the time, it was put back down to £150

until June 2005 when it was raised to £500.

3. My statements run from the 3rd of the month to the 3rd of next month. My

closing balance on 3rd September 2004 was £260.21 overdrawn but within the limit of the £300 agreed overdraft. My opening balance on the next statement at

3rd September 2004 was £260.21 overdrawn with the overdraft limit at the top

of the statement being shown as £150 therefore overnight I went from being

within my overdraft limit to £110.21 above the shown overdraft limit thus giving

cause for penalty charges being applied. This has caused me some hardship making it a struggle to catch up, and to stay caught up, and has contributed to my being forced, last month, to convert my overdraft into a Managed Loan, the first payment being due 20th of this month, and which, of course, is made up largely of a proportion of the penalty charges on the attached schedule. You may like to consider the question of

this Managed Loan.

 

To recap, my claim is for £1422.50 and have been offered £1250 - not a bad offer but only if they cancel out all or most of the Managed Loan. There is also the question of the mistake they made in note 3 above by altering the overdraft limit (must have been some kind of typo mistake) without my knowledge or agreement which put me overnight from being within my overdraft limit to above the limit and in the position of incurring penalty charges.

 

My LBA dated 1 August crossed with Colin Langdale's offer letter, also dated 1 August giving me 10 working days to accept the offer (fast running out). I wrote back to Colin Langdale on 3 August - extract of this letter in my previous post - but to date no word.

 

Should I e-mail and ask please respond? Should I ring? Is he going to stall until the 10 days is up and then take the offer off the table? If he does that my LBA is already with him and days counting down to issuing court action.

 

Look forward to your opinion. Many thanks

Lurcherlady

[Bookworm]

To recap, my claim is for £1422.50 and have been offered £1250 - not a bad offer but only if they cancel out all or most of the Managed Loan. There is also the question of the mistake they made in note 3 above by altering the overdraft limit (must have been some kind of typo mistake) without my knowledge or agreement which put me overnight from being within my overdraft limit to above the limit and in the position of incurring penalty charges.

 

If they owe you £1422.50, that's what you should hold out for.

 

There is no question they should cancel the loan, why should they? You did borrow that money, and if you insist on getting your charges refunded by cheque, then you will still owe that money. If you want the loan to disappear, pay it off with the charges. The refund of charges is not a bonus payment, it puts you back where you were before you incurred them. So if some of the money on the loan is money YOU borrowed, you are still liable for it.

 

I read it that you want the charges refunded in your hand, and the loan to go. That would effectively mean the bank paying out twice. :-?

 

As for the mistake they made, so what? They made a mistake, charged you for it, you reclaim those charges back. Again, I do not see why the fuss.

 

Concentrate on getting your charges 100% back.

 

Then assess what you want to do with it. Get rid of a debt, and see it as a very important step towards financial recovery? Or spend it here and there, and still be in hock to the bank for god knows how long....

[Lurcherlady]

If they owe you £1422.50, that's what you should hold out for.

 

There is no question they should cancel the loan, why should they?

 

This is a Managed Loan. The majority of it is made up of penalty charges - not money I borrowed. Why should I take the money with one hand and then pay it back to the bank with the other?

 

 

I read it that you want the charges refunded in your hand, and the loan to go. That would effectively mean the bank paying out twice. :-?

 

More like me paying twice!

 

As for the mistake they made, so what? They made a mistake, charged you for it, you reclaim those charges back. Again, I do not see why the fuss.

 

I might never have incurred penalty charges if they hadn't made this mistake - unfortunately I didn't notice it at the time.

[Bookworm]

This is a Managed Loan. The majority of it is made up of penalty charges - not money I borrowed. Why should I take the money with one hand and then pay it back to the bank with the other?

 

Because when they repay you the penalty charges, it would then get rid of that loan. If you decide to use the money elsewhere, then they have already repaid you the charges once, therefore, you woull still have a loan!

 

More like me paying twice!

 

How?

 

I might never have incurred penalty charges if they hadn't made this mistake - unfortunately I didn't notice it at the time.

 

Yes, but they are paying those back!

 

Let's make it simple. Imagine you have £0. You owe nothing, the bank owes nothing. You go overdrawn by £50, then bank charges you £50. The bank now says you owe £100. Clear so far?

You reclaim your charges, the bank pays you back £50 by cheque, which you use to go and buy groceries. You now still owe the bank £100! On the other hand, if they pay the £50 against the o/draft, then you will only owe them the £50 you had gone over by.

[Janet-M]

My agreed overdraft limit was £500 and I my balance was £1158.76

Can I just ask how much exactly of this £1158.76 was unlawful charges and how much of that figure was money you had spent on shopping etc ?

 

As I think that is the main question that needs to be asked before anymore advice is given