Unenforceable agreements under the Consumer Credit Act

[Stub001]

Has anyone experienced similar to this before or can anyone provide the benefit of their knowledge...

 

My girlfriend had a loan with Lloyds TSB and had thought that she had come to the end of the term of the loan only to be told that 5 installments were still outstanding. She has been switched from one loan product to another during the loan term and by Lloyds own admittance is on an "old-style" loan. She sent the CCA letter in April requesting a copy of the original credit agreement and she had heard nothing (no agreement, no chasers for the money, nothing) until Nov 3rd '06 when she received an unrelated letter from the local branch manager (rare, I know) asking what her intentions were to repay the debt. She replied (on Nov 15th) advising of their breach of the CCA and that she did not acknowledge the debt and would not enter into any further correspondence regarding the debt. On Dec 19th Lloyds sent a letter from the local branch stating that were unable to resolve the matter at branch level and that the matter had been forwarded on to their Customer Service Recovery department (CSR). On Dec 20th a letter was sent by the CSR stating that they were hopeful of completing their enquiries within the 'coming 2 weeks'. On Jan 4th '07 they issued a long letter apologising (twice) for inconvenience/stress etc, stating that they cannot find the loan agreement within their filing system, and offering a 'solution agreeable to all parties'. They claim there is over £2000 outstanding but are proposing to reduce that amount to £1380 and offer a new interest-free loan for £1380 repayable over 36 months.

 

Then, with negative affirmation, the letter states "that if I don't hear back from you at all by 1st March 2007, I will take it that matters are resolved between us and close my file." (Apologies should have posted well before now but it had slipped my mind).

 

What, if any, should be my girlfriend's response to this?

 

Is negative affirmation able to be used in a scenario such as this?

 

Any thoughts would be most welcome.

 

Thanks.

 

Stuart

[tbern123]

Has anyone experienced similar to this before or can anyone provide the benefit of their knowledge...

 

My girlfriend had a loan with Lloyds TSB and had thought that she had come to the end of the term of the loan only to be told that 5 installments were still outstanding. She has been switched from one loan product to another during the loan term and by Lloyds own admittance is on an "old-style" loan. She sent the CCA letter in April requesting a copy of the original credit agreement and she had heard nothing (no agreement, no chasers for the money, nothing) until Nov 3rd '06 when she received an unrelated letter from the local branch manager (rare, I know) asking what her intentions were to repay the debt. She replied (on Nov 15th) advising of their breach of the CCA and that she did not acknowledge the debt and would not enter into any further correspondence regarding the debt. On Dec 19th Lloyds sent a letter from the local branch stating that were unable to resolve the matter at branch level and that the matter had been forwarded on to their Customer Service Recovery department (CSR). On Dec 20th a letter was sent by the CSR stating that they were hopeful of completing their enquiries within the 'coming 2 weeks'. On Jan 4th '07 they issued a long letter apologising (twice) for inconvenience/stress etc, stating that they cannot find the loan agreement within their filing system, and offering a 'solution agreeable to all parties'. They claim there is over £2000 outstanding but are proposing to reduce that amount to £1380 and offer a new interest-free loan for £1380 repayable over 36 months.

 

Then, with negative affirmation, the letter states "that if I don't hear back from you at all by 1st March 2007, I will take it that matters are resolved between us and close my file." (Apologies should have posted well before now but it had slipped my mind).

 

What, if any, should be my girlfriend's response to this?

 

Is negative affirmation able to be used in a scenario such as this?

 

Any thoughts would be most welcome.

 

Thanks.

 

Stuart

 

 

It sounds like they have treated this as a complaint, escalating it from their branch level 1 to their level 2 CSR's,

 

Anyway, without being funny I would write to them and ask them to clarify on what basis are they demanding payment, considering that there is not a CCA. I would keep the inital letter short and to the point. If they don't agree I would write a letter quoting the CCA and everything else lol

[Stub001]

Thanks. Will do...nice and simple three lines of text.

 

Stuart

[diskmandave]

See CC Act 1974

 

s77(4)(a)(b)

 

http://www.crw.gov.uk/resources/consumercreditact1974.pdf

 

Regards, Dave.

[adarling2006]

could u quote this section plz, being lazy lol

[adarling2006]

don't bother found it, sorry

[diskmandave]

Sheeesh!

 

(4) If the creditor under an agreement fails to comply with subsection (1)--

(a) he is not entitled, while the default continues, to enforce the agreement; and

(b) if the default continues for one month he commits an offence.

 

Only just beat me to it!

[robert_harper_2000]

What if you had finished paying off your loan or credit card. Could you request a copy of the CCA and fight the previous interest you had paid??

[Zimmie]

A CCA won't help if you have paid off a loan or credit card. Your need to send a SAR, this will provide you with all your financial dealings with the organisation in question so you can check for illegal charges having been added.

[robert_harper_2000]

I was more thinking about what if there hadn't been illegal charges but the agreements weren't filled correctly? Would it not be possible to fight these?

[Zimmie]

Sorry I really haven't a clue about that one. Maybe someone with more than my limited knowledge can help.

[un1boy]

I was more thinking about what if there hadn't been illegal charges but the agreements weren't filled correctly? Would it not be possible to fight these?

 

No, unfoortunately. If the account has been paid off and/or closed then the CCA no longer regulates it.

 

78 Duty to give information to debtor under running-account credit agreement

(1) The creditor under a regulated agreement for running-account credit, within the prescribed period after receiving a request in writing to that effect from the debtor and payment of a fee of £1, shall give the debtor a copy of the executed agreement (if any) and of any other document referred to in it, together with a statement signed by or on behalf of the creditor showing, according to the information to which it is practicable for him to refer,—

(a) the state of the account, and

(b) the amount, if any, currently payable under the agreement by the debtor to the creditor, and

© the amounts and due dates of any payments which, if the debtor does not draw further on the account, will later become payable under the agreement by the debtor to the creditor.

(2) If the creditor possesses insufficient information to enable him to ascertain the amounts and dates mentioned in subsection (1)©, he shall be taken to comply with that paragraph if his statement under subsection (1) gives the basis on which, under the regulated agreement, they would fall to be ascertained.

(3) Subsection (1) does not apply to—

(a) an agreement under which no sum is, or will or may become, payable by the debtor, or

(b) a request made less than one month after a previous request under that subsection relating to the same agreement was complied with.

(4) Where running-account credit is provided under a regulated agreement, the creditor shall give the debtor statements in the prescribed form, and with the prescribed contents—

(a) showing according to the information to which it is practicable for him to refer, the state of the account at regular intervals of not more than twelve months, and

(b) where the agreement provides, in relation to specified periods, for the making of payments by the debtor, or the charging against him of interest or any other sum, showing according to the information to which it is practicable for him to refer the state of the account at the end of each of those periods during which there is any movement in the account.

(5) A statement under subsection (4) shall be given within the prescribed period after the end of the period to which the statement relates.

(6) If the creditor under an agreement fails to comply with subsection (1)—

(a) he is not entitled, while the default continues, to enforce the agreement; and

(b) if the default continues for one month he commits an offence.

(7) This section does not apply to a non-commercial agreement, and subsections (4) and (5) do not apply to a small agreement.