letter before action from Restons re a Next account circa 2011

[Nomzit]

Hello all,

i recieved a letter today from Restons solicitors tellingly me I have 30 days to respond before I get a court summons. I am a single mum with a mortgage so you can imagine my worry.

I recall speaking with debt managers services at least 2 years ago disputing the amount of the debt. I never heard anything so I left it.

Out of the blue comes this letter.

What do I do? please help. I am terrified of losing my house. I pay my other creditors £1 a month and the debts are smaller than this.

please help, I cannot afford a solicitor.

[Amethyst]

The potential claim is for £4000 although you only believe you had a balance of £2500 when the account defaulted?

Debt Managers own the account so they are the 'creditor' which means you should send them a CCA Request

Then you should complete the form that Restons sent with the letter, saying it is disputed and you need more information, asking for a breakdown of the amount claimed, the agreement, default notice and notice of assignment. It's likely it is coming up to 6 years from default ( does anything show on your credit file still) and that's why they are claiming now ( to avoid being time barred under the statute of limitations - although tbh your enquiry with Debt Mangers a couple years back might be classed as acknowledgment anyway )

I'd also send a SAR off to Next to find out how this balance grew so much. Subject Access Request Letter
I can't see why you would lose your house over a £4k debt, IF they went to court and obtained a judgment against you, they may then be able to apply to have a charge put over your house, likely while you make installment payments that are affordable ( so if that is a £1 a month so be it ) - it would have to be quite extreme for them to apply for and obtain a sale order over the property.

The £1 a month you currently pay to other creditors, is that through a debt management plan or is it something you have just sorted out on your own, and then, how come this Next debt isn't included in it?

On the Solicitor front, some will do a case on a CFA ( they get paid by claiming costs from the other side ) so it could well be worth making some enquiries if you don't feel able to deal with this yourself - you'd really want a specialised consumer credit solicitor - there's a couple of firms on here - Joanna C pt2537 - if you have a look at their signatures. If they couldn't do a CFA they might at leats be able to give some intial advice and an idea of costs if it did end up going to court.

[Nomzit]

Hello Amethyst. Thank you so much for your reply.

The default shows as 6th July 2014 on my credit file. To

i pay 3 other creditors £1 a month, which I sorted myself around 2 years ago after receiving endless letters from them. I spoke with stepchange at the time but they didn’t setup a plan because I didn’t have enough money left over so they suggested I pay £1 a month - at the time I buried my head in the sand and Next left me alone so I just didn’t think about. I’ve had one letter from this company and that was when I spoke to them asking them to raise a complaint with Next but as I say I didn’t hear a thing.

Last time I spoke with Next they called me to say they wanted to pay me £10 for incorrect interest and that was it.

What should I do now? Should I contact debt managers and offer a payment????

[Amethyst]

You could complete the income/expenditure form that came with the letter of claim if you do just want to arrange repayment of this. As this is quite recent ( taken out 2011 and defaulted 2014 ) then it is likely they will have the correct documents, however this increase from £2.5k to £4k should be looked at so you could use the form to ask them to evidence how the balance has been calculated, possibly, if you don't want to challenge it, you could 'admit' the £2.5k and query the remainder. Personally I'd first send the CCA request to debt managers and ask Restons via the form to evidence the debt and provide the breakdown of the sum they're claiming, agreement, default and notice of assignment and go from there, potentially making an offer of installments once they've provided the information.

Have you investigated other options for getting your debts sorted out, those £1 won't go on forever and I don't think you want to spend the next goodness knows how long worrying about another possible court claim - did Stepchange come up with any other advice at all ? It might be worth getting yourself an appointment with CAB as they are formal debt advisorys and might be able to give you more options.

[Nomzit]

This is my main worry Amethyst. I’m just plodding along paying £1 a month. If anything things have gotten worse since I defaulted on these debts. I work part time, and I have two children with a very small income and so many bills.

The problem I have is I’m a homeowner so I’ve looked at a number of options with the CCCS back then and they said that the only thing I could do was sell the house. I didn’t have enough of a disposable wage to have an IVA.

I think I’m going to have to speak with CAB. I will try and find a number online.

In in the meantime I will follow your advice and request this information and complete another income and expenditure form ready to send off.

Can i send it off to Debt managers once they respond or is the only option dealing with Restons now? They have a lot of bad reviews online when it comes to payment instalments.

[Diana M]

i recieved a letter today from Restons solicitors tellingly me I have 30 days to respond before I get a court summons. . . . .

I recall speaking with debt managers services at least 2 years ago disputing the amount of the debt. I never heard anything so I left it.

Out of the blue comes this letter.

Who is the owner of this debt?

Debt Managers (Services) Ltd is a debt collection agency not a debt purchaser.

Does that letter from Restons solicitors say who their client is?

Di

[Diana M]

The problem I have is I’m a homeowner

. . . .

In in the meantime I will follow your advice and request this information and complete another income and expenditure form ready to send off.

Can i send it off to Debt managers once they respond or is the only option dealing with Restons now? They have a lot of bad reviews online when it comes to payment instalments.

If that is a formal Letter Before Claim then you have 30 days to respond so don't rush into a hasty decision until you know your potential legal position.

Completing the I & E Form with an offer to pay by instalments does not guarantee that they won't issue a claim anyway, especially if they have searched your CRA file and established that you are a homeowner since you have a mortgage on the property which would be visible on your CRA file.

If you send a s 77-79 CCA Request to the debt owner (once that has been established) and they don't/can't comply within the statutory time-frame then the debt becomes unenforceable in court until or unless they do comply.

This could put you in a positon to tick Box D on the LBC stating you dispute the claim due to non-compliance with s 77-79 CCA.

You say you're a single Mum but is the house in your sole name or in joint names with another person?

When did you last make a payment towards this debt (perhaps two yeas ago)?

Di

[Nomzit]

It shows on my credit file as Debt Managers Services Ltd own the debt.

I imagine they have done a search.

I have never paid towards it (I’m ashamed to say) the balance is the same as it was from account opening according to my credit file.

I think the last payment was actually to Next. Which would’ve been 2014.

The house is solely in my own name. I bought it when I was 18 (12 years ago) The mortgage value is £59k and has been valued at £95k and it’s only just been bought up to date in November 2017 as I was in arrears with it for about 4 years following a marriage breakdown.

[Amethyst]

The creditor is listed as Debt Managers Service on the letter from Restons so yes, you should send the CCA request to them, and return the completed form to Restons ( once you've considered your options - first step is send the CCA request as you can use that as a point of dispute on the form - you have 30 days to respond).

It is likely they will have the documents (eventually) and may be looking for security of the debt by taking it through court - as it sounds like you're not going to be able to offer anything in the way of substantial installments, then it is unlikely they'd accept a token offer at the moment. I reckon get them to provide the documentation and details of how the debt has arisen and built up, and then look at your options once they respond. You could also get yourself an appointment at Citizens Advice and add that onto the form, it gives you a bit more breathing space before they would be able to issue a court claim, if that's what they are looking at doing. At CAB you can go through your full income/expenditure - check you are getting everything you're entitled to and see what you have available if you did decide to make any installment offer.

Also when asking for documents on the forum ask for the notice of assignment - it does seem to be Debt Managers Service but tbh we haven't had much dealing with them and they are usually a debt collector rather than a debt purchaser - there is another claim similar at the moment as you've seen which does call them the creditor so they may have moved into the purchasing of debts business.

How important is it to you not to have a CCJ ?

Have a read about Charging Orders - as if it did go to a judgment and you had an installment order of an affordable amount, they may still apply for a charge on the house. It is very VERY rare to go to a sale order, particularly where it is a family home.

Well done getting your mortgage back on track after what must have been a difficult time.