Halifax credit card and later payment fees

[pj2017]

I have a Halifax One Credit card, the balance of which has been around £2400 for a year now,

with me paying around £40 regularly, but not paying off any debt.

 

I missed the payment by a week last time for the first time, but paid the amount, £38 a week late.

 

now I have incurred a £12 late payment charge in addition to my monthly interest.

This is the first such charge on my account.

 

If people believe these charges are illegal,

can I simply pay my next payment without the £12 charge and let the bank know I dispute the charge?

Or should I pay it anyway and then argue about it?

 

I have had this credit card since about 2010,

and although I sent off CCA request today,

I think it is likely the bank has all the documentation in order for a card that is relatively recent.

 

If I stop servicing this old debt,

how high can the bank take the balance?

 

Eg the £2400 already includes mainly intereset,

and if I don't pay can they add interest until its £10K and more,

or do they have to move it to a DCA and stop increasing the balance at some point?

[pj2017]

Dear all, I haven't got a scanner, but I have received my CCA from Halifax Card Services.

 

* It say it is a reconstituted version of the agreement, with both original and current terms and conditions, and copy of my orignal signed application form

 

* It is one of those application/agreement forms - ie you sign to apply for the card, and the page says you are agreeing to be bound by the Consumer Credit Act 1974 and some terms and conditions are included on the same page you sign.

 

* It is not signed by the bank - although the covering letter says they are not obliged to show any signature box, they do show it - and they haven't signed it themselves. So does an agreement exist?

 

* The letter says "the prescribed terms of the agreement would have been validly incorporated into the agreement on the reverse of the enclosed sheet or a separate attached sheet", but what they have printed out as the original terms and conditions are 8 pages long. It seems the first 4 pages are identical to the small print conditions on the page I signed - they managed to fit 4 pages of T&Cs on the one page I signed by using a smaller font - and the other 4 pages are the "General Credit Card Conditions", and the page I signed said "by signing above you agree to be bound by the General Credit Card Conditions".

 

Unfortunately, it looks like a valid CCA apart from the fact that it was not signed by the creditor. Can anyone confirm this is enforceable?

[BRIGADIER2JCS]

Was a statement provided?

[pj2017]

Yes, they provided a statement - a few lines giving the balance, the interst rates, the arrears and amount payable etc. I am amazed they responded so quickly - they got the CCA out to me in days. It does tend to show that where they don't send it out to customers - they haven't got it - as they are anxious to send it out in the 12 days allotted if they have it.

[pj2017]

I am wrestling with a problem with this credit card debt ,

but there are few replies on the Halifax forum

- and this is more of a general question about strategic default on debt).

 

I have to pay £40+ a month just to make the minimum payment,

and then there is no reduction in my debt anyway.

 

Essentially, after a year of playing this game, I will have parted with £500,

with no reduction in a debt that is around £2,500.

 

I would prefer to pay off £40 against the actual debt outstanding,

with interest frozen so that after a year I stood a chance of whittling down the balance.

 

Of course, there are numerous threads here about writing to creditors asking for interest to be frozen

- I presume it is nearly always a waste of time, and if they did do that, it would always be only after an income/expenditure form had been filled in,

where the presumption is that everything in my life should be pared to the bone with my sole existential purpose the paying off of a credit debt,

or, more realistically, the servicing of a debt in such a way as to create a permanent income stream for Halifax.

 

Some people claim here that just three missed payments leads to a default notice and then it goes to debt recovery

- does that mean no more interest is added from that point?

 

Wouldn't it be better to just default then, and then negotiate a payment plan on a balance that is now not constantly being stung with interest?

 

If I do not plan to apply for credit anywhere, would it be better to just default?

The credit rating doesn't matter to me as such - so I'm trying to work out what is the best thing to do for me.

 

Most of these organisations that help you with debt eg CCCS are actually working for the banks

- they are not giving you good advice for you,

 

they are trying to get income and expenditure details out of you, which only a judge can order you to give.

 

Can someone who has faced my situation give me some advice on whether defaulting would be a better scenario than paying £500 a year for absolutely no gain?

 

Does default definitely lead to a cessation of interest?

 

Also I own a house - a very low-end house that has a mortgage by the Bank of Scotland on it, part of the Halifax group,

and I am up with the payments on that but I did go into 6 months of arrears at one point

- and so Halifax might see that

- it is very unlikely if the house were repossessed that any equity would be left after sale at auction

- but what is the situation with debts if you do have assets like a house?

 

The fact that I have somewhere to live means I won't need to apply for mortgages or other things in the foreseeable future and so I can ignore a bad impact on my credit rating, but if Halifax tried to make me bankrupt, which would force the sale of my house, my finances could get even worse than they are now.

 

I am seeking advice that is not geared, as with CCCS to collection/debt recovery, but what is in the best interests of the debtor, ie, me.

[dx100uk]

a default does not freeze int.

 

write and tell them they are only going to get £xx for xx mts as a GOODWILL GESTURE.

 

aas a reciprocal GOGW will you require them to freeze int and refrain from PENALTY cahrges

 

should they fail to help you as they must , as per guidelines

 

then you will drop them to £1PCM

 

dx

[pj2017]

a default does not freeze int.

 

write and tell them they are only going to get £xx for xx mts as a GOODWILL GESTURE.

 

aas a reciprocal GOGW will you require them to freeze int and refrain from PENALTY cahrges

 

should they fail to help you as they must , as per guidelines

 

then you will drop them to £1PCM

 

dx

 

 

Would that not seem like a threat, and wouldn't they then take legal steps as they would then know I could have squeezed out £X a month and not just £1? I'm thinking of trying it though.

[dx100uk]

it is a threat

they have refused to help

they want your money

 

if they dont help, they dont get it.

 

any judge would eat them for breakfast

 

there are CLEAR guidelines that show they must help.

 

dx

[pj2017]

I have received a letter from Halifax saying my credit card account will be closed in 2 months from today and no new card will be issued.

 

This followed my asking for a CCA which arrived last week (the CCA was the normal not properly executed as not signed by the bank agreement, but otherwise OK).

 

They said:

 

Once your account has been closed, no change will be made to your standard interest rates on any balances you may have outstanding .

. you'll still need to make payments on your account untiil any balances are paid off.

 

How can they still add interest to an account that has been closed? Will they be able to add charges also on a closed account?

[BRIGADIER2JCS]

They are not obliged to send a ''signed'' copy.

 

Why did you request a CCA, is the account in arrears or over limit on occasions.

[pj2017]

They are not obliged to send a ''signed'' copy.

 

Why did you request a CCA, is the account in arrears or over limit on occasions.

 

But they did send a copy of the agreement that included the signature box - they didn't have to - but they did - and it is clear that they did not sign it.

 

I know that is not a serious issue to raise with them, as judges will enforce it will only the debitor's signature.

 

The account is not in arrears or over limit, and I have been late with payment once - but I have paid the minimum balance for well over a year now and have a debt of £2,500 that is not going down despite servicing it every month.

 

The point I was trying to find out about in my post above - and so I should not have mentioned the lack of a creditor's signature - is whether they can close an account - and still continue to apply interest. If anyone knows, I would be very glad to hear their views.

[bigshoes...bigsocks]

I don't see why they can't continue to add interest to your outstanding balance. |I'm not sure they've used the right terminology by syaing they'll be closing your account. The non issuing of a new card simply prevents you from usng the card to accrue further debt.

 

if this is still being managed acceptably then is it worth risking a default on your Credit file to argue this with them?

[pj2017]

The outstanding balance is £2,500.

 

I was not querying PPI = as I did not take PPI out - I just asked for a copy of the CCA with no explanation as to why I wanted it - and the following week they have decided to close my account - can they still add interest on a closed account?

[BRIGADIER2JCS]

Yes they can still charge interest on the OS balance, the right to close an account at any time after giving notice to you will be in the Ts & Cs.

[pj2017]

Yes they can still charge interest on the OS balance, the right to close an account at any time after giving notice to you will be in the Ts & Cs.

 

Thank you for that.

I am self employed and have had a lot of work cancelled

- and have received no payments from clients since Oct 11

- and the only piece of work I have lined up is one piece of work on Tuesday.

 

I have asked clients if they have any work for the rest of the year, but I have nothing at all lined up.

 

I have written today to Halifax to explain that - and explain that my mortgage is with the Bank of Scotland (their group)

and that I am trying to avoid closing my business and going on the JSA, as I might lose the house,

and I mentioned that a recent auction of a house in my street showed I would not be able to cover the debt to the BoS if the house were repossessed and auctioned.

 

I explained this to them so that know that bankruptcy and/or charging orders - would simply force the sale of my house

- with an impact on the BoS, which is part of their bank - and there is no equity.

 

instead of paying the £50 minimum balance,

I have told them I have set up a standing order to pay £10 a month on this card

and asked them to take account of COBS and freeze interest and charges for six months

- and then for us to mutually review the debt in six months' time.

 

I don't know if it'll work - but it is what dx100uk of the site team recommended

- and I said that if they don't respond with their own gesture of goodwill by freezing interest and charges,

given that I am looking at very very very little income, and a mortgage to the BoS to pay and a tax bill at the end of January,

I might have to take the standing order down to £1 a month.

[pj2017]

- I have offerd £10 a month by standing order, to go down to £1 if they don't freeze interest and charges. I mentioned COBS They have decided to cancel the card anyway...

[BRIGADIER2JCS]

That's a good response.

[pj2017]

Thanks. What I wrote exactly was this:

 

You have decided to close my account within two months of my receipt of your most recent letter, which has a reference XXXX on it. You say you will put interest on a closed account—I don’t know the legal basis for applying interest to a closed account, but I am sure you will expand further on this—and in any case, there has been very little spending on this account over the past two years, and so a good deal of the balance is simply your interest and charges, and interest on the interest, and interest on the interest on the interest, etc.

 

I am self-employed and facing a large reduction in my income. As I have a house, I don’t want to go onto the Jobseekers’ Allowance unless I really have to, as I might lose the house. The mortgage is owned by the Bank of Scotland, which is part of your group, and I would not like them to repossess the house, as a recent auction sale down my street of a house in a similar condition to mine was transacted at a level that would be insufficient to pay the outstanding balance on the mortgage to the Bank of Scotland. I am sure the Bank of Scotland will tell you I was in six months of arrears on the mortgage at one stage, and I have got back on top of it, but don’t know how long I can pay the mortgage when my income is so variable and low. I have other debts in addition to the Halifax credit card that I am struggling with. So maybe you can understand I am trying to put off closing my business and going onto the Jobseekers’ Allowance if at all possible.

 

However, the last payment I received from a customer of mine was on October 11, and I have one piece of work lined up for Tuesday morning, when I will earn £XX (which will be paid when the client gets round to it) and then I currently have no work lined up for the rest of the year. I am hoping some of my previous clients give me business, but at the moment I am keeping my fingers crossed, because I have the mortgage, the council tax, fuel bills to pay, and then a tax bill due at the end of January.

 

So I don’t know what to do about this credit card outstanding debt, which is, as I say, made up to a considerable extent of interest on interest—and now you tell me, interest that will be applied on a closed account. I do know that banks have a duty to treat their customers fairly. Credit cards are covered by the Conduct of Business Sourcebook (COBS), including the requirement that “a firm must pay due regard to the interests of its customers and treat them fairly” and that “a firm must manage conflicts of interest fairly, both between itself and its customers and between a customer and another client”. I am told COBS is now considered to be part of any contract, and failure to adhere to COBS may be actionable as breach of contract.

 

I am now struggling greatly, and I don’t know how long I will be able to make the payment that I have set up, because food comes first, and then priority debts including tax, council tax, mortgage and fuel bills, and so I will have to “play it by ear”. So I will not be making the minimum payment, at least for a while, but as a gesture of good will I have set up this standing order to pay £10 a month off the card. Here is a record of my standing order that I have set up to be paid today by Faster Payment and monthly thereafter:

 

SCREENSHOT OF STANDING ORDER I SET UP WAS PUT HERE.

 

Please respond with a reciprocal gesture of good will by freezing interest and charges on the account. As I have made clear the only earnings I am currently due to receive in November are the £XX work I will do Tuesday and nothing else is arranged for the remainder of the year. Obviously, I am very worried about it. If you cannot accept my gesture of good will and will not freeze interest and charges on this account, and given the fact that my earnings are so low and unreliable anyway, I will have to consider a lower standing order, of maybe £1 a month. As you know, only a judge can decide the amount that has to be paid, and there are necessary living expenses, including food and fuel, that any judge would consider to be priorities over the servicing of a usurious closed account.

 

I would propose your responding to my gesture of good will with your own, as outlined above, for six months, and then a mutual review of the situation.

 

Please help, and please bear in mind COBS when you reply,

[BRIGADIER2JCS]

Good!!!!

[dx100uk]

4 threads on same debt merged

 

please kep to ONE THREAD per debt.

 

dx

[pj2017]

I don't see why they can't continue to add interest to your outstanding balance. |I'm not sure they've used the right terminology by syaing they'll be closing your account. The non issuing of a new card simply prevents you from usng the card to accrue further debt.

 

if this is still being managed acceptably then is it worth risking a default on your Credit file to argue this with them?

 

No - they've said specifically that they are closing the account and I will not be able to apply for it be reopened thereafter. I was late with one payment, which I made a few days too late - and incurred a £12 fee - the only fee that has been applied to this account. Of course, there has been a lot of interest, but apart from that one time late with the payment, I have never been late or missed payment. And suddenly, after making a CCA request, they close the account down.

[BRIGADIER2JCS]

You need to make a FORMAL COMPLAINT TO THE BANK, get a final response and complain to FOS.

 

BTW we are always watching.

[pj2017]

OK thanks - I'll do that, but should I wait for a response to the letter I have already sent?

[BRIGADIER2JCS]

How long ago did you send the letter?

[pj2017]

this morning