When does a default notice come into effect?

[leighsmum]

I had a default notice served on me by my bank on May 1. I wrote back saying that I disputed the amount as a lot of it was made up of charges. Yesterday I got a formal demand for repayment. At the bottom it says they will notify a credit reference agency within 28 days if I don't pay up.

I'm torn between continuing the course of action I've already started, of paying back the £128 I owe and demanding that the charges are taken off and the default notice removed; or paying them the £570 total overdraft and then claiming the whole lot back through the court.

The thing is, I'm not sure that the default's been registered yet. If it hasn't I am OK to continue with the first course of action because the default won't be served until the middle of June and I should have dragged them to the doors of the court and got my money back by then.

If it has, I would be better off paying them and then claiming it back, wouldn't I?

Can anyone advise?

Many thanks

[jonni2bad]

Hi

 

The default notice would normally be served at the expiry of the 28 day deadline. So if the notice is dated 1st May, then you could take that to mean 29th May.

 

In an ideal world, that fact that you have told them you dispute the sum should stop this action being taken, but we don't live in the that world....

 

It might also be argued that you could take further action against the bank because of that failure, but I see no need to make more work for yourself.

 

If you continue, believing that they will hold back, and then still proceed - you can at a later date have this reversed as part of your claim. However, if you are in a position to meet the demand and avoid this scenario, then it might be prudent to do so. It will avoid any potential future difficulties....

 

There is nothing to stop you from paying the amount needed to settle this, and then reclaiming the amount you have calculated as unfair charges (it's also not an issue if this figure is less or more than the figure needed to clear things up now).

 

The choice must always be yours - my opinion is that, if you can resolve the default issue now, do so. Start you claim for the refund of charges at the same time (or if you are in the process, then continue).

[BankFodder]

I'm confused here because of the mixture of legitimate debt and charges. As you seem to be saying that the legitimate debt is a smallish sum: £128, I would suggest paying this off so that you are left with a clear figure and which you are confident are just unlawful charges. This opens the way to take some proper action without any confusion. I would advise you to pay off the legitimate part of the debt as soon as possible -- urgently. At the same time the in a separate envelope send a section 10 DPA notice which you will find in the template library. In this notice you can refer to the total of charges which you are disputing and also the section 10 notice will be letting them know that you consider that their personal data record is inaccurate. It also puts it beyond doubt that the matter is in dispute -- and of course under the banking code they are not entitled to register a default when there is a figure in dispute. Even though they may still go ahead and register the default it will give you the moral high ground and make it much easier to sort out.

 

You should do all of this immediately. There is no time to spare because your time will be running out very soon. Make sure that when you send the payment you accompany it with a note which makes it clear that you consider that this is all that you do owe and that the rest of the amount is in dispute. Refer also to the fact that you are sending a section 10 notice under separate cover.

 

Read the new DPA FAQ which will give you a lot of important information about the data protection act and how to use it. Be certain that you understand that the next step may well be a court case and that you are comfortable about this. The court case would be to challenge the default because in all likelihood they will ignore you and go ahead regardless. However it is time that someone decide to stand up to this kind of treatment. I don't think it is very risky in terms of your best interests and so I don't see any reason why you shouldn't at least have a try at it.

[leighsmum]

Thank you both for your considered replies. I'll mull it over during the rest of the weekend and ACT on Monday! I'll also start a thread in the Alliance and Leicester section too, as that's who it is.

Thanks very much again.

leighsmum

[leighsmum]

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