Nationwide Offseet Loan From Current Account - Now In OD!

[Stagparty]

Hi Vint

 

Thanks for the reply, I haven't contacted the FO yet re the increased overdraft. All communication has been within Nationwide.

 

They still haven't replied to the CCA request so I can't check the agreement to see if they can combine with overdrafts - the wording in one of their letters is that they can "combine it with any other Nationwide account"

 

Despite acknowledging the eLoan was a regulated agreement they haven't (yet) clicked that they have changed it to be unregulated. Nor have they realised that they failed to issue a default notice which allowed time for me to rectify any alleged breach and that by transferring the eLoan to the current account they terminated the eLoan.

 

Do you think involving the FO would be a better strategy than accepting their unlawful rescission of the eLoan?

 

If the eLoan was unlawfully rescinded then the matter of the increased and unrequested overdraft becomes secondary on the basis that the transfer to the current account was unlawful, or am I missing something here?

[diddydicky]

do both

[Stagparty]

Diddy/Vint - If I draft a letter would you be good enough to cast your eyes over it?

[diddydicky]

i'm in a mellow mood- ill cast BOTH eyes over it

[Stagparty]

On the basis that I've just got 90% of the way through the draft letter and then managed to delete it when trying to refer to another document its probably best if I do it over the weekend when I'm a little less tired!

 

I appreciate all your help guys.

[diddydicky]

and the moral of the story is....................SAYG

[Stagparty]

OK guys - my first draft is below - I've learned my lesson Diddy... wrote it in word and copied it to here"

All advice is welcomed - I'm especially concerned about the OD being "non-regulated" but I'm almost sure I've read that the CCA has to be followed in respect of Default Notices etc....

Dear Sirs

I refer to recent correspondence and have now had chance to review thoroughly previous correspondence. I also note you have now seen fit to refer this account to KPR despite it being in genuine and serious dispute. You are aware of my concerns as to NW’s conduct to date, these concerns and disappointments remain.

Having taken advice, I would comment on the eLoan as follows.

1. In September 2009 a request was made under s78 CCA 1974 regarding the eLoan. This was signed for on X and to date has not been responded to. You will be aware that under the provisions of the Consumer Credit Act 1974 NW had 12 working days from receipt of the request to provide the relevant information. NW has never responded to this request and consequently the account entered formal dispute on X.

2. The eLoan is an account regulated under the Consumer Credit Act 1974. NW acknowledged this in their letter of X.

3. By “collapsing the eLoan into the flex account” NW effectively terminated the eLoan account. By terminating this account by merely transferring the balance to another account without warning NW are in breach of the CCA 1974. NW should have issued a Default Notice detailing both any alleged breach and the actions required to rectify any alleged breach by a specific date. NW failed to take this step and as a result the subsequent termination is unlawful, specifically it amounts to an unlawful rescission of contract. For the avoidance of doubt, I accept NW’s unlawful termination of this account. Following an unlawful termination the only amount due is the amount of genuine arrears at the date of termination. Would you please be let me know what you consider the genuine amount of arrears to be on the date that the balance was transferred to the Flex Account. I am able to claim damages from NW for the unlawful rescission of contract and at this moment in time can see no reason why I should not pursue this. I note in previous correspondence that NW has claimed the right to transfer the balance in according with the terms of the account. Whilst I would refer to point 1 above, which means I have not had chance to examine the conditions of the account, I would also assert that statute will override terms and conditions. Consequently, irrespective of what the terms and conditions of the account state, the provisions of the Consumer Credit Act 1974 take precedent. Hence the way the transfer and termination was conducted by NW was unlawful.

Turning to the Flex Account, I would comment as follows

1. I dispute the alleged balance owing on the Flex Account as it includes amounts not due following NW’s improper and unlawful actions as detailed above.

2. NW has never actually written to me formally withdrawing any facility. I have merely deduced this from other correspondence.

3. The Banking Code provides that an overdraft facility should not be granted without the customer’s request or permission. This permission has never been granted or requested and never would have been. Consequently NW is in breach of the Banking Code and a formal complaint to the Financial Ombudsman will be made shortly.

4. Despite NW knowing that the account was in dispute they issued a DN under s87(1) CCA 1974 on X. The DN is defective in so much as it does not permit sufficient time for any alleged breach to be remedied and the action required to remedy any alleged breach is totally ambiguous. The DN requires “all amounts owing to NW” to be repaid. I sincerely have no idea what sum would precisely be necessary to do this as the balance in correspondence around that time includes the unlawful transfer from the eLoan account, interest on the whole amount at unauthorised overdraft rates and charges for being over limit. Subsequent actions including advising that banking facilities are no longer available and passing the matter to KPR are clear demonstrations that NW consider the account to have been terminated. It is therefore clear that this termination is also unlawful. Again for the avoidance of doubt, this unlawful termination is accepted. I again reserve the right to take an action for damages for the unlawful rescission of contract.

In the circumstances may I respectfully request that this matter is withdrawn from KPR immediately and that this is confirmed in writing by return. May I also request that NW discharge their obligation under s78 CCA 1974 in relation to the eLoan account. May I also have the information requested in point 3 of the eLoan section of the letter above and finally may I have NWs proposals to settle this matter.

I look forward to hearing from you in the near future.

[diddydicky]

Personally i would condens e it – but your call obviously

 

Dear Sirs

I refer to recent correspondence and have now had chance to review thoroughly previous correspondence. I also note you have now seen fit to refer this account to KPR despite it being in genuine and serious dispute. You are aware of my concerns as to NW’s conduct to date, these concerns and disappointments remain.

Having taken limited advice, I would comment on the eLoan as follows.

1. In September 2009 a request was made under s78 CCA 1974 regarding the eLoan. This was signed for on X and to date has not been responded to. You are therefore in default of your obligations under s78 of the consumer credit act and are prevented from enforcement until such time as you comply.

The eLoan is an account regulated under the Consumer Credit Act 1974. Which you have acknowledged

 

3.On XXXXXXX date you unlawfully terminated the agreement. And you were, at the time if that unlawful rescission entitled only to the amount of arrears outstanding.

 

Following termination of the agreement, and in contravention of the banking codes of practise you appear to have transferred the amount of the credit agreement onto my current flexaccount thereby causing an overdraft and or further loan that i had not agreed to

Despite the foregoing and notwithstanding that no valid agreement existed upon which to serve a Default Notice , you then serve a s187(1) default notice against a non existent account, and which therefore had no legal effect, Even were there an account in existence to which it could be lawfully served, the default notice would be invalid in any event.

 

I suggest that a meeting be arranged to discuss a resolution to this matter in an informal setting failing which i will be making a omplaint to the banking ombudsman and will defend and counterclaim any action you may bring against me- if necessary with CFA assistance.

 

Y F

[Stagparty]

Thanks for the reply Diddy, could you please clarify a couple of points for me?

 

At point 3 re the eLoan did you mean "at the time of the unlawful rescission, you were only entitled to the amount of arrears outstanding"?

 

The flex account did already have a facility that was being used, so they caused the facility to be exceeded rather than created. On the basis that there was an existing current account which was overdrawn I don't understand this bit....... "Despite the foregoing and notwithstanding that no valid agreement existed upon which to serve a Default Notice , you then serve a s187(1) default notice against a non existent account, and which therefore had no legal effect, Even were there an account in existence to which it could be lawfully served, the default notice would be invalid in any event." Could you explain please?

 

Finally, showing my inexperience again here.... what does CFA mean?

 

Thanks again - I really do appreciate your help!

[diddydicky]

I had assumed from your posts that the E loan was a fixed or running credit account seperate from your flexaccount

 

they unlawfully terminated this agreement so were only entitled to ther arrears

 

the right of "set off" by which a bank can group your debts onto one account would only apply to an account that is in credit- and then only if they had a lawful debt,

 

since they in effect made a gift of any sums not yet due when they unlawfully terminated your regulated agreement they cannot then "transfer" this non existent sum by taking it from your flexaccount

 

in effect they are trying to replace a regulated agreement with one that is not. so unless you signed a new credit agreement (regulated) for the money they took from your flaxaccount to pay off the e loan - then they cannot issue a default notice because there is no (valid) agreement in existence to issue it against

 

if they attempt to claim that this was then an unregulated agreement then they would have to explain what a licensed creditor is doing flogging unregulated loans

 

IF the agreement had been lawfully terminated AND you had sufficient funds in credit in your flexaccount they COULD have taken these to pay that debt- but NOT if it puts creates an overdraft (which is essentially a new loan)

 

the fact that your flexaccount was already overdrawn is of no consequence- you cannot be forced into a new loan without your agreement

 

as they say oop north- they are stuffed any road up chuck!

[Stagparty]

Ah OK - I think I'm following you slightly better now - I fear I may have misled you slightly!

 

Yes - the eLoan was a seperate account to the Flex Account, although you could only transfer monies to and from the Flex Account. It had it's own account number and own credit limit.

 

I understand the bit about not being able to replace a regulated agreement with a non regulated agreement (I think) and I assure you I haven't signed any new credit agreements allowing this

 

It's the bit about the DN that I am confused about - In a previous reply you said "you then serve a s187(1) default notice against a non existent account" - the only DN they have served is against the Flex Account, albeit it is defective for reasons above. Could you give me another clue please?

 

Sorry, I still don't understand CFA either

 

I'm glad you think they are stuffed though - I've thought that from the start but waited until they have formally terminated stuff before telling them.... the old "give them enough room and they'll hang themselves" saying.

[diddydicky]

i understood you (wrongly it seems) said the DN was served against the E loan account.

 

any way, they unlawfully terminated the e loan and therefore the DN issued against the flexaccount- if issued under s187(1) would have contained an incorrect amount as arrears if it included missed payments on the loan that was unlawfully "transferred" to it) apart from any other issues with the DN (dates etc(

 

CFA- Conditional Fee Arrangements (no win - no fee lawyers)

 

was the e loan fixed term or a credit card account?

[Stagparty]

Thanks for the clarification

 

The eLoan was a credit facility whereby you were assigned a limit. You could draw down funds as you wanted to Flex Account and repay whatever you want whenever you want, subject to a minimum of (i think 3%) per month of the outstanding balance. The main condition was that you drew funds down from the eLoan to the Flex Account and you only repaid money from the Flex Account. I think it is categorised as a revolving credit agreement?

 

The DN issued against the Flex Account contained no figures at all - the remedy was to "repay all monies owing" - that's why in my first draft i said that I had absolutely no idea how much would have been necesary to remedy the defect.

 

Thanks for the clarification on the CFA terminology.

 

Bearing in mind the above, would your wording of the reply change?

 

Thanks SP

[diddydicky]

well against an overdraft that would be right i think- but NOT if the unlawfully rescinded account balance was included

 

yes, - i would leave out the reference to the DN being issue against a non existant account and concentrate on the unlawful rescission and the amount stated in the dn

 

were the dates ok for the DN? can u post it up as they sometimes omit prescribed text

[Stagparty]

The DN didn't allow time for service and doesn't quatify the amount needed to remedy the breach. I can post it up if you want?

 

I've amended your letter slighty -what do you think?

 

Dear Sirs

I refer to recent correspondence and have now had chance to review thoroughly previous correspondence. I also note you have now seen fit to refer this account to KPR despite it being in genuine and serious dispute. You are aware of my concerns as to NW’s conduct to date, these concerns and disappointments remain.

 

Having taken limited advice, I would comment on the eLoan as follows.

 

1. In September 2009 a request was made under s78 CCA 1974 regarding the eLoan. This was signed for on X and to date has not been responded to. You are therefore in default of your obligations under s78 of the consumer credit act and are prevented from enforcement until such time as you comply.

2. The eLoan is an account regulated under the Consumer Credit Act 1974. Which you have acknowledged

3.On XXXXXXX date you unlawfully terminated the agreement. Consequently you are only entitled to the genuine arrears at the date of the termination. Please let me know what these are.

4. Following termination of the agreement, and in contravention of the banking codes of practise you transferred the amount of the credit agreement into my flexaccount thereby causing an unauthorised overdraft that i had not agreed to

5. Despite the foregoing and notwithstanding that no you were still in breach of the request made under s78 CCA 1974, you served a s187(1) default notice. The DN was defective as it failed to allow sufficient time for any alleged breach to be remedied and failed to clearly state the action necessary to remedy any alleged breach. You then terminated the account. For the avoidance of doubt, I accept the termination

6. I would be within my rights to claim against NW for the unlawful rescission of contract, at this moment in time I see no reason why not to and consequently reserve my rights in this regard

I suggest that a meeting be arranged to discuss a resolution to this matter in an informal setting failing which i will be making a complaint to the banking Ombudsmanand will defend and counterclaim any action you may bring against me- if necessary with CFA assistance.

Edited March 29, 2010 by Stagparty
removal of formatting so it is easier to read

[diddydicky]

you are confusing me now- probably your letter not being in chronological order

 

just re state

 

are you saying that they terminated, transferred the debit to your flexaccount and THEN issued a DN

 

or did they issue a DN against the flexaccount, terminate and then debit your flexaccount?

[Stagparty]

OK this is how it happened.

 

1. ELoan transferred to Flex Account with no notice (effectively terminating it)

 

2. DN issued on Flex Account

 

3. Flex Account terminated.

 

So, both the eLoan and the flex account have been terminated but the only DN was on the FlexAccount and that was defective.

 

Hope that's clearer

[diddydicky]

Having taken limited advice, I would comment as follows.

 

1. In September 2009 a request for a true copy of the executed agreement was made under s78 CCA 1974 regarding the eLoan. This was signed for on X and to date you have failed to comply You are therefore in default of your obligations under s78 of the consumer credit act and are prevented from enforcement until such time as you comply.

 

2. The eLoanwas an account regulated under the Consumer Credit Act 1974. Which you have acknowledged

 

3.On XXXXXXX date you unlawfully repudiated your obligations under that alleged agreement which i have accepted and therefore the agreement- if it were ever to have been a properly executed and/or legally enforceable agreement was unlawfully terminated In the event that the alleged agreement were to prove t be properly executed and/or legally enforceable (which is denied), then you would be entitled at termination to the outstanding arrears which i would ask you to advise me of, against which there may be a counterclaim for damages.

 

4. Following your unlawful termination of the alleged agreement, and in contravention of the banking codes of practise you appear to have debited an amount equal to the balance of the aforementioned agreement against my my flexaccount thereby causing an unauthorised overdraft that i had not agreed to.

 

Your right of "set off" does not amount to or include a transfer of monies that were not yet due under a regulated credit agreement to which you were not entitled to by virtue of your failure to first serve a valid default Notice from my flexaccount

 

the right of set off may only be applied to accounts in credit and does not give you an entitlement to create an overdraft or further borrowing, nor to change a regulated agreement into an unregulated agreement or another regulated agreement to which i have not agreed

 

Indeed by your unlawful actions you have in fact "made a gift" of those monies.

 

 

 

5. You should remove the debit of this amount from my flexaccount immediately and note that if you fail to do so i will make an immediate complaint to the baking ombudsman OFT and Trading Standards

 

 

I would suggest that an informal and without prejudice meeting would be appropriate in the circumstances to discuss a mutually acceptable resolution of this matter

 

 

yours sincerely

[Stagparty]

Thanks very much Diddy, I really apprecaite your help

[Stagparty]

May I just check one point in this in anticipation of NW's response.

 

In view of the fact that they terminated the eLoan account before the s78 CCA request was made, is this just really a red herring as far as the dispute is concerned?

 

Thanks again

SP

[vint1954]

May I just check one point in this in anticipation of NW's response.

 

In view of the fact that they terminated the eLoan account before the s78 CCA request was made, is this just really a red herring as far as the dispute is concerned?

 

Thanks again

SP

No and try not to get bogged down in too man things. Concentrate on the fact that they did not have the right to transfer to your account, if it caused you to go overdrawn.

[vint1954]

Did you send DD's letter from post 58?

[Stagparty]

Hi Vint

 

I did send a letter based on DD'd post number 58.

 

The "Senior Manager" dealing with it has passed it to their "independent complaints review decision" who have decided that NW are right (surprise surprise) without even trying to contact me to decide the facts.

 

Interestingly they say that there wouldn't have been an agreement as it would have been an electronic tick box in 2001 when the account was opened. Consequently although they have lost the s78 request they are bothered as there wouldn't have been an account to send me!

[diddydicky]

electronic tick box in 2001?

 

im not all that well up on online applications but that seems a bit far fetched to me!

[Stagparty]

electronic tick box in 2001?

 

im not all that well up on online applications but that seems a bit far fetched to me!

 

I think the regulations that allowed this were brought in mid 2000 and do remember being "invited" to tick a box to "reveal" the amount I could have on the e-Loan when I logged onto the internet banking. I do though have a vague recollection of having an application form sent for signing before finds were released. I might though be imagining this. 2001 is a long time ago!

 

Does anyone else who has or has had a Nationwide e-Loan remember the application process?