bobtheb v morgan stanley **WON**

[bobtheb]

sent MCOL 6/10 561.66 . 295 charges +266.66 interest

+105.14 8%

+80.00 court fee = 746.80

 

 

Now had a letter saying because payments go FIRST to fees charges etc they cant agree with my interest calculations. Has anyone else encountered this argument?Ive not come across it in 10 other claims:confused:

[bobtheb]

Anyone any ideas on this ,they are basically saying that as charges are paid off first there is virtually no interest to pay:mad:

[smartmartian10]

I have no idea if it is correct or not. Why not tell them to prove it, please demonstrate to me that this is so or show me where it is stated in terms.

 

If they can not or will not should be safe to pursue it all!

[Guest bong]

bob can you put the exact wording they used on here so we can examine the logic behind it (if there is one )

[bobtheb]

HI Bong this is what they wrote !! The nature of our payment hierarchy, as detailed in our Terms and Conditions , clearly states that any payment made to your account is first set off against any fees or charges applied to your account.The interest per default fee is therefore calculated by reference to the amount of the fee,the number of days between it being charged to your account and the date of your next payment and the annual interest rate applicable to your card expressed as a daily rate(in pence)

Our calculations show that the amount of interest charged to your account stands at £1.14

 

My calculations using Vampiress's magnificent spreadsheet comes to £174.72

[Guest bong]

I don't understand it. If you give me the first line of whats in your spreadsheet I don't mind trying it out for you to see what interest figure I get so we can see if it tallies.

[bobtheb]

Ive tried it on an original spreadsheet and also a Google one and they agree,but they work on the principle that the fees and charges are paid off last.Morgan Stanley are saying that they pay off charges first(the only one as far as I can see ,among the credit card companys)

[bobtheb]

SRM thanks for your reply, when I call them back I will certainly ask them to prove it

[Guest bong]

I've got their terms and conditions here but they are quite confusing.

 

they say payments are applied in the following order

 

1. interest on transactions (ie purchases)

2. then the transaction

3. any fees relating to transaction

4. all other fees and charges are paid off after the interest on the first transaction charged at a non-preferential rate

 

does this help?

[bobtheb]

Thanks Bong that seems to prove they are wrong and they repay charges last:)

[Guest bong]

tbh, it was me who numbered them 1 - 4 like that, but they are written in that order and I can't work out if it means that 4 is paid after 1 and before 2. I've never seen an agreement worded quite like it. I don't know if I'm confusing the issue so perhaps you'd better take a look at them yourself. they are also on the website Morgan Stanley : Main

 

I wish you luck

[bobtheb]

Ive read somewhere on here ,if its ambiguous,it should work in the consumers favour:confused:Although I think the only way thiis could be interpreted,is charges are after interest (on your normal transactions) is paid:rolleyes:

[Guest bong]

I'm wondering if we could get zootscoot to look at the terms and conditions to see what she makes of them. I'll try and get them up on here and ask if she'd mind having a look. She's very good.

[bobtheb]

Thanks very much:)

[kokomar]

What order they apply your payments to different items is irrelevant. The fact is that the charges are unlawful, they deceived you into paying them, had the charges not been applied, your payments would have reduced your balance further, eg.

 

Statement £100 of which £20 is a charge. You pay £50 and are left with a balance of £50 which they charge interest on. Had they not applied the charge the remaing balance would have been £30 thus accumulating proportionally less interest.

 

Hope this helps. Koko

[kokomar]

Sorry tired I meant proportionately!

[Guest bong]

The relevant sections of the Morgan Stanley Card Terms and Conditions

 

 

Allocation of payments

 

F. We will apply payments we receive first to interest on a Transaction, then to the amount of the Transaction itself in the following order -

 

1.Balances to which promotional rates apply,

2.Balances to which promotional rates do not apply, or no longer apply, starting with Balance Transfers/Purchases, followed by Cash Advances.

 

See Condition 3.5 of the Card Terms and Conditions for full details.

 

 

Morgan Stanley Card Conditions

 

3. Payments and Interest Charging

 

3.1 We will not charge interest on any Purchase shown on your current statement if you pay in full the Statement Balance shown on your current statement by the Payment Date. If you pay in full the Statement Balance shown on your current statement by the Payment Date but you did not pay in full the Statement Balance shown on your last statement by the Payment Date, we will charge interest on each Purchase shown on your last statement from the relevant Transaction Date until you have paid the amount you owe us in full.

 

 

3.2 We charge interest on..

 

Cash Advances, Balance Transfers and Credit Charges from the relevant Transaction Date,

 

Account Cheques from the date the Account Cheque is given to us for payment, and

 

any other amounts payable under this Agreement from the date on which such amounts are charged to the Account;

 

in each case until you have paid the amount you owe us in full.

 

3.5 We will apply your payment in the following order to all amounts due in relation to your last statement, before moving to Transactions that have been made but have not yet appeared on your statement.

 

First we will apply your payment to pay off Special Transactions...

 

Next, we pay off any other Transactions (including Special Transactions to which preferential interest rates no longer apply) -

 

a starting with Balance Transfers/Purchases,

b followed by Cash Advances.

 

If you have more than one Transaction within either of these categories, then we will apply your payment to them in the order in which we added them to your Account.

 

We apply your payment first to the interest on, then any insurance premium relating to, a particular Transaction, then to the amount of the Transaction itself and then to any fee relating to that Transaction. All other fees and charges are paid off after the interest on the first Transaction that is charged at a non-preferential rate.

[bobtheb]

Hi Kokomar yes I understand your point,but if they pay the charges first ,from each payment ,the days interest is due ,are not very many(they have kindly worked this out for me!!and if you pay on time the interest is very small:mad:)

[Guest bong]

Hi bob, while we're waiting to see if zoot will comment I have been wondering some more about what koko said. It seems to make sense that if (if being a very big IF) your payments have gone first to pay off charges, then (assuming you have not cleared the outstanding balance), the money that was used to pay charges has not been applied against your purchases and the purchases are accruing more interest than they would if the charge hadn't been made. Therefore I think you wouldn't be claiming interest on the charges but excess interest on the purchases. Afterall the interest has accrued somehow and if not on the charges it must be the purchases.

[Guest bong]

looks like you're not the only one!! - http://www.consumeractiongroup.co.uk/forum/other-institutions/4086-morgan-stanley.html?highlight=hierarchy#post43931

[bobtheb]

Hi good news, just spoken to Victoria Maschio ,in the Law Division,on the phone.Offer of full amount in the post today(After speaking to her superiors!)

I quoted her their terms ,off she went and then phoned me back with the offer.

I will await their letter with bated breath:eek:

[Guest bong]

great news:D

[zootscoot]

Hi Bob and Bong (sounds like some sort of animated comedy duo!)

 

tbh, it was me who numbered them 1 - 4 like that, but they are written in that order and I can't work out if it means that 4 is paid after 1 and before 2.[/QUOTE]

 

I think this is right. The charges are applied after the interest on the transaction but before the transaction. This means that you will actually pay the charges earlier than you may have thought. Although you can then claim the statutory interest from an earlier date which may go some way to balance it out.

 

Hope this helps

 

Zoot

[zootscoot]

Ooops I didn't see the second page before I posted.

 

 

Congratulations.

[Guest bong]

Thanks very much zootscoot