If the original charge was caused by financial difficulites

[whistleblowing fairy]

it's great that we're all on the way to getting our chagres back. but has anyone thought of what caused the fees to be added, and how to stop them in future???

 

yes i know if more charges are added, we just start the whole process off again. But that's just a work around, it's not preventative.

 

As my employer has signed up to the banking code, it encourages us to do our bit. So i'm doing my bit and actually going to offer help to those with fin diff, as it's known in the business.

 

If the reason why you missed that first payment which resulted in a charge, or if you're still in fin diff despite the refunds, then you might find it useful to continue reading. If it wasn't then you won't.

 

Firstly, I'd say it's important to maintain contact. The bank won't assume you can't afford to pay, they'll assume you don't want to pay, which is when you'll start getting more calls and letters. From experience, I know the more calls and letters those with fin dff receive the more scared/nervous/anxious they become and continue to avoid us.

 

At the end of the day, if you don't like the way the call is going, just hang up rather than making yourself upset.

 

The next thing I would say it's important to do is, write a list of all your income and expenditure ( don't include creditors yet). Keep everything in the same format, so if you paid weekly do everything weekly, if you're paid monthly do everything monthly etc. Also be realistic, you can't stick to a payment plan if you don't allow for buying new clothes or socialising because at some point you'll need to.

 

You next want to make a list of all your priority debts such as mortgage arrears, council tax arrears etc again don't include your creditors yet.

 

You then want to work out what's left ( income - minus expenditure - priority debts). Whatever amount is left over is what you can afford to split to creditors.

 

You now want to list all the creditors you have and how much you owe.

 

When you've got all this ready, send it to every creditor along with a payment offer. e.g. if 10% of your debt was to a loan, offer them 10% of the total amount you've got to pay all your creditors. It's a good idea to send this recorded delivery, so you can check they've received it.

 

If they wont accept your offer, make the payment anyway. (that's referred to as a token payment and does go in your favour as it looks better than not paying)

 

Please don't wait till you get a default notice because by then it's usually too late to accept reduced offers and only the payment on the default notice can stop the account defaulting.

 

If your account does default, send all the income and expenditure info to the debt collection agency as just because the bank wouldn't accept it, doesn't mean they wont.

 

Hope anyone in fin diff has found this useful, as I know from the letters i see at work it sometimes takes a lot of calls/letters to get told what info to send and by then it's often too late.

[whistleblowing fairy]

also if you think this was helpful and/or would like more stuff like this, please leave a reply and I'll work on it for you.

 

a bank worker who wants to help

[barracad]

Some good, sensible advice.

 

To some it will be common sense, but to others who are struggling and can't see a way out, this will help to put things into perspective.

 

If anybody thinks they can't manage these steps on their own, you can get free and independent confidential advice from Debtline.

[whistleblowing fairy]

 

If anybody thinks they can't manage these steps on their own, you can get free and independent confidential advice from Debtline.

 

definately! or any other free debt managment company like the Consumer Credit Couselling Service/ CAB.

 

Don't use a fee paying one, they offer the same advice as the free ones only your first installment won't pay your creditors, it pays them.

[caro]

This looks really good. Thanks for taking the time. I like the idea of seeing what you can afford after paying your priority bills, and offering the same %age repayment as the %age of the debt. Great idea.

 

I know we knock the banks, but you can't really blame the people doing their jobs. This kind of insider info is really useful, and helps people regain control of their finances, which is what this site is all about.

 

Thanks again.

[meagain]

First off, worthy contributions from "collaborators" within the banks are always welcome, especially if it is a small step towards making banking more transparent. Thanks for the insight.

 

The bank won't assume you can't afford to pay, they'll assume you don't want to pay, which is when you'll start getting more calls and letters.

 

In this country, business is usually operated based on a presumption of innocence, and a failure to presume such tends to foster distrust with customers. Anyway, one would expect that with the spiralling personal debt (£1tn!) we have, the prime suspect on the list of possible reasons for non-payment is someone extending their borrowing beyond their capacity to repay it.

 

What are your thoughts on offering an amount less than you can afford, and then making payments in excess of the agreed amount to get ahead with the payments? e.g. Budget allows for £50 payment, agree £40 with creditors, and make payments of £50, getting 1 period ahead after 4 payment periods.

[poochball]

Having been in the exact situation above I can understand what it can be like.

 

One piece of advice I would give is if you are paying to a Debt Collection Agency:

 

-Keep Proof of Every Payment

-Keep a spreadsheet of your payments and the balance to date.

-Call every three months to confirm your balance. (You will be amazed what happens if you don't as I found out).

 

Also Payplan is a good Free Debt repayment service funded by the Banks who charge us (at least they do something right).....

 

All in all don't stress out and keep calm, if you are making the effort to pay then you are doing right.

[blueskies]

Thank you for that post it was excellent.

 

I have been in the position described before (half of the bank charges I'm reclaiming are from when I was in that situation). The problem is when you go to collect your post and you know it will be bad news you don't want to open it. I have boxload of letters from years ago which are still unopened. This lead me to get a CCJ from, believe it or not, the water board, and they didn't take me to court until I hadn't paid them for 18 months.

 

However much you tell people to at least be aware of their problems it takes a lot of guts to do it. I am now in a position where my debts are easily in control and although I'm still paying off a loan from that time I'm financially secure.

 

People won't take that step until they are ready. The best support network are friends and relatives that encourage you to help yourself.

 

I will say that, although I'm sueing them at the moment, Barclays are very good at spotting problems and offering help. I have never had a nagging phone call from them that didn't offer reasonable ways of dealing with the problem and leaving me in a better position than before the call. I am going to stick with them because of that. (If they don't close my account)

[caro]

Well done karnevil. Sounds like you have ben through a rough time, but are getting sorted now, and getting your charges back is just part of that process. You really are taking control now.

[shortcake]

Yes, I did this. it's good advice. I left it too late though. Some of them accepted, some of them flatly refused.

[whistleblowing fairy]

I left it too late though. Some of them accepted, some of them flatly refused.

 

that's why it's sooo important not to bury your head in the sand and hope it will go away if you ignore it long enough. it won't it just gets worse.

 

I do know it's scary, admitting anything usually is. But from what I see at work, the sooner you seek help the more help you can get and the less impact it will have on your credit rating.

[Guest]

First of all, let me be perfectly clear in saying that the advice given throughout this post is great.

 

However... A small thing that isn't quite right is that most creditors, whether they be banks, credit card companies, or loan companies - will not accept a lower monthly payment without defaulting the account first.

 

This means that they can then assign your debt to the right department who are (apparently) trained to HELP you !!! In my experience, this just means that they are now shrugging off the debt onto a DCA for them to pick up the pieces.

 

I know some people have had limited success in negotiating directly with creditors, but on the whole it's not easy.

 

I'm not going to offer any advice, as I think there's enough information around, and I don't want to add to any more.

 

What I will say is though that DCA's are slimey scoundrels who will do anything to get your money. Whether you owe them money or not, I always like to have a certain amount of "fun" with them first ;-)

 

On the whole, great advice. And it is more than welcome !!!

[Tigs33]

Excellent advice, also another thing I would like to point out is that most creditors will accept a low payment, the alternative for them is to go to court and most courts will agree with you NOT the creditor with the lower amount even if it takes years to pay off the debt. The courts will not want to take away your home or make your financial situation any worse than it is, as long as you maintain the payments to the creditor and show that you are trying to repay the money back.

 

Also do not be intimidated by your creditors or DCA if they try and increase your payments, just say no, send them an up to date list of income and expenditure to prove that your payment is all you can afford to pay. If they continue to ask for higher amounts they are actually harassing you.

[dommcd]

Ive done that too Karnevil. I paid barclaycard £170 to stop them from issuing a default notice despite the fact I couldn't really afford it and am know faced with a similar situation with halifax £124 by the end of july or they will come and get me.

Once I get a better job (I am one of those bloody students, well acually im a graduate and have been for a while now) I should be able to afford to get rid of all these banks but at the mo i am busy destroying what was up untill about march a pretty good credit rating (or at least not a bad one) then when I can afford to pay off a loan to cover all these debts I probabally wont get one because of all of this penalty charges and defaulting business.

[dommcd]

Oh by the way this is a great site. I have learned so much about consumer law over the past week I could probabally be a guest on working lunch ha ha.

[MARTIN3030]

Ive done that too Karnevil. I paid barclaycard £170 to stop them from issuing a default notice despite the fact I couldn't really afford it and am know faced with a similar situation with halifax £124 by the end of july or they will come and get me.

Once I get a better job (I am one of those bloody students, well acually im a graduate and have been for a while now) I should be able to afford to get rid of all these banks but at the mo i am busy destroying what was up untill about march a pretty good credit rating (or at least not a bad one) then when I can afford to pay off a loan to cover all these debts I probabally wont get one because of all of this penalty charges and defaulting business.

 

I know you probably have your hands full but it would be worth your while thinking about trying to sort your credit files out as well as the penalties.

I understand its a minefield as I am dealing with 5 DCAs myself and 2 have not replied to my requests for copy agreements after deadline.

Its always advised here if you threaten someone with action.....make sure you follow it up dont just say you will.

I now have to report these ppl to the oft and trading standards.

More time more running around and more paperwork.

It becomes a strain when you have them all running at once.

My paperwork tackling the dcas is now getting as much as the 4 banks and 2 card issuers I am fighting.

But I see this as a great opportunity to tackle the defaults I have been given.

 

At the end of all this I am hopeful of a good credit file because now is the time to tackle it but my god...........I sometimes wish it was an easy task.

 

[dommcd]

I hear that!

Im trying to do this thing one at a time but maybe i dont really have the time to do that.

I have sent two initial requests and intend one more within the week (you hear that capital one Im coming to get you!) I was luky in that i didnt need to send of for a list of my charges as all i needed could be viewed on my online accounts (god bless you internet) so at least that bit was easy.

As for the rest, well barclaycard and halifax have about another week before the second letters get sent an in the meantime I will take your advice an look into the credit rating thing.

Anyway im going to bed (helping girlfriend find a car tomorrow) goodnight all.

[whistleblowing fairy]

most of the companies I've asked to accept reduced payments, have done so without defaulting the account. Only one defaulted the account but as long as make the lower payment on time the account won't be passed to an external dca.

 

they were even really understanding when i explained that i couldn't reduce the payments on my staff card, because of it being seen as gross misconduct. that's because i was honest about why i needed the exta £60 a month for one creditor rather than trying to fiddle the figures on my expenditure.

[MARTIN3030]

Its ok to agree on reduced payments but often for some people it gets too much to begin with.Theres other debts that are so called priority.....but how can you prioritise between food shelter heating lighting having petrol in the car and clothes for the kids.

At the end of the day you need all of these.