Repossession hearing next week

[Goldlady]

My friend has just asked me to help with repossession proceedings against her. This has been brought by secured loan provider via Eversheds and she has had paperwork since mid July. If anyone has experience of such proceedings I would welcome any advice.

She and partner took out sec loan in 2004 for 52K. there was PPI of nearly 13K !!!!!!!! which only covered her partner. Payments were £545 but are now £702 not including any arrears or charges. Interest rate was 9.4 apr but is now 11.5.

They also have first mortgage not in arrears and an IVA.

Questions:

Can I represent her in court?
The POC specify that it is not a regulated consumer credit agreement ?
Included with the POC is a list of terms and conditions signed by the lender but no application form signed by my friends - is this relevant?
Will the IP dealing with IVA be able to help or hinder?
Can the court do anything about the PPI?

They earn enough to pay the £702 but are being asked to pay too much against the arrears. Doesn't help that when my friend filled in the income and expenditure form she put their gross salaries in the income side so it looks like they have loads of spare money!! Obviously I will correct this, but this has no bearing on the proceedings. Eversheds have told her that it is in her best interests to get the court to intervene.

I am trying to see if they have enough equity in the house to pay off the IVA and this loan and start living again.

Have asked Eversheds for copy statements to be faxed prior to hearing - they seemed to think this was an unusual request (). All we have is a list of the arrears. There will obviously be lots of lovely charges but this is probably not the best time to reclaim them.

On the defence form it says you can ask the court to consider if the loan conditions are fair and if they can restructure it - but then says if it is not regulated CCA you can't fill in these boxes.

Sorry if this is garbled but any help appreciated.

Cheers

Goldlady

[iancognito]

Re: Repossession hearing next week

Firstly the loan will not be covered by the CCA because of the amount, there is a limit to loans covered by the CCA which I think is £25k (correct me if I'm wrong).

The PPI situation is the same for any loan, whether covered by the CCA or not, if it has been mis-sold you can reclaim the payments, it would only be mis-sold if you can prove they wouldn't pay out because he was unemployed, self employed or had a pre-existing medical condition that would preclude him from claiming. The other mis-selling issue is whether the loan would be offered without the PPI included. If any of the above is relevant, mis-selling of PPI could be included in their defence.

There is no reason why the level of penalty charges shouldn't be investigated and certainly should be included in the defence but if the case is next week I assume it could possibly be too late for this now.

Courts do not like to turn people out of their homes unless they really have no option, you say your friend can afford the loan repayments - has she been paying them regularly? has she made any attempt to pay of the arrears by overpaying monthly repayments? If so, all this will go in her favour. I have even seen judges reduce interest significantly to assist a defendant with repayments, all this could go against the loan company - not saying it will tho.

Finally she needs a copy of the agreement, she needs to check the amounts involved and whether the PPI was added to the loan and therefore subject to interest, effectively increasing the advertised interest rate at which the loan was sold, this has been identified as a problem in an OFT report and would be worth mentioning.

Hope this helps, there are some questions I haven't answered, this is because I don't know the answers, hopefully someone will come along soon who does.

[Goldlady]

Re: Repossession hearing next week

Thanks for that - you are up early - or late going to bed

They have been paying the arrears off as well as the monthly payment apart from in March when he changed jobs and didn't get his full wages/bonus from old job. Loan co have been asking them to make up March money which obviously they haven't got but they have been paying regularly since then. They had been paying £150 per month towards arrears and had increased offer to £300 based on the incorrect income and exp calculation - so obviously they can't afford that.

Think we might struggle with PPI as they did agree to it and he is employed. I hope to get the statements before the hearing so I can work out the penalty charges and whether interest is being added to them!

[Amy]

Re: Repossession hearing next week

How much are the arrears?

[Goldlady]

Re: Repossession hearing next week

Just under £3000

[Goldlady]

Re: Repossession hearing next week

We were just wondering if the PPI in total should have been added in at beginning of loan as obviously interest has been charged on that too. It is a 25 year loan.

[Amy]

Re: Repossession hearing next week

How much have they managed to pay back towards the arrears?

[iancognito]

Re: Repossession hearing next week

Most of them do this as they are giving you credit to pay for the PPI, yet another con methinks, makes the loan very expensive. The OFT have looked at this issue but their solution was to ask lenders to make customers aware they may be able to buy the insurance cheaper elsewhere.

[Goldlady]

Re: Repossession hearing next week

It's a bit difficult to tell as they make a payment weekly - but in the last three months they have paid £200.75 per week - the monthly payment is £708 so approx £161 a month off the arrears.

[Amy]

Re: Repossession hearing next week

I can't see them being granted a suspended possession order as they are making a real effort to pay off the arrears.

[WendyB]

Re: Repossession hearing next week

Long time ago when we nearly got reposessed, LTSB said arrears had got to be paid off within 3 years. Judge agreed with them, but as he could see we'd been paying it off anyway, he set the payment at what we were already paying towards the arrears (as he said it was obvious we could afford to pay that as we were already paying it, if you see what I mean). He refused to up the payments so we carried on as before, as directed by the Judge. He was actually very nice although it was a bit scary, even the LTSB solicitor was nice.
In the end we paid the arrears off in 18 months. I think it was about 2k. He did not grant suspended possession order but did say that if we didn't pay up he'd reconsider.

so I think that your friends will be okay, especially as as the rate they've been paying it off it should be clear in about 18 months, and they can show they've been making a real effort to clear it..

[Goldlady]

Re: Repossession hearing next week

Thanks for that Wendy I will tell her what you said as she is terrified.

I am hoping the judge will be a friend of mine

Goldlady

[Goldlady]

Re: Repossession hearing next week

Here is the defence - I am seeing a solicitor at the court with my friend so hopefully will tidy it up. I don't want to quote legislation as my friends are supposed to be defending themselves. I can't help being antagonistic although have tried my best to suppress the sarcasm. No statements received by the way!

"In August 2005 we took in a homeless teenager who needed food clothing and shelter. We had expected to receive some financial assistance towards his care however this did not happen and we eventually found alternative accommodation for him in early 2006 after spending a great deal of money on him. This caused our loan to fall into arrears but we were able to borrow money in order to bring the account back up to date in November 2005.

In March 2007 Mr X changed jobs and was not paid his full entitlement by his previous employer. We then fell into arrears and have not been able to make up for the missed March payments.

We had agreed to pay the claimant £200.75 per week in order to clear the arrears and have maintained payments of this amount by weekly standing order since 20 April 2007. After receiving the claim form we completed an income and expenditure form however as we are inexperienced in completing forms like this, and were in somewhat of a panic on receiving the claim, we put our gross salaries on the income side, instead of our actual earnings, and offered the claimant £300 per month towards the arrears. This has been accepted by their letter of 7 August 2007 however we now realise we simply cannot afford to pay this amount.

We have made two payments of the revised amount (£250.50 per week) however this week have had to borrow money to buy food and realise that we must have miscalculated. What we also failed to take into account is that Mr X’s work in the building trade is well paid during the summer months, as he is paid for projects he completes, whereas during the winter he will receive his flat rate only which amounts to only £307.15 per week. This has been calculated on the attached spreadsheet on the assumption that he will lose three months of the higher payments in a year.

Additionally we have an IVA which commenced in February 2007. The payments agreed were £204 per month for the first seven months increasing thereafter to £304 for the following 18 months. We have contacted the insolvency practitioner and have been asked to notify him of the outcome of this hearing if we are unable to meet the contracted payment.

We have asked the claimant’s solicitors for copies of the account statements as the arrears statement attached to the claim form only covers the period to 1 June 2007 and we cannot work out from this how much the actual arrears now are. Additionally we believe that a proportion of the amount outstanding on this loan is represented by unlawful penalty charges and therefore require this information to establish our position.

Also, the original credit agreement shows that payment protection insurance amounting to £12734.80 has been added to the amount borrowed of £52,000 and that interest is being charged on this from inception in addition to the loan amount. We have now been informed that the claimant should have explained to us that we could obtain insurance of this type, which only covers Mr X in the event of job loss, from an independent insurer at far less cost and we therefore believe it has been mis-sold. We have calculated that, not including the arrears (towards which we have paid a further £601.92 since the claim was issued) we will have to repay approximately £181,000 from now until the loan ends for an original borrowing of £52,000.

We are also aware that interest rates are expected to rise again and do not wish to commit ourselves to clearing the arrears at a level we will no longer be able to afford should this happen. The payments have already increased from the initial £545.38 to £702.08.

We therefore respectfully request that the court considers restoring our arrears payments to £150 per month. The claimant states that the arrears as at 25 July 2007 are £2987.47, however we have no way of confirming this. Since that date we have paid one payment of £200.75 and two of £250.50 and working on the basis that £162.02 of each payment represents the monthly installment (708.02 x 12 / 52) we have further reduced the arrears by £215. Assuming the arrears are now £2771.78 using the claimant’s figures, the arrears should be cleared in 18 months if we pay the original £150 per month.

Attached:

Spreadsheet showing correct Income and Expenditure figures with seasonal variance

Copy of fax to solicitors requesting copy statements

Copies of defendants’ bank statements showing payments being made by standing order"

Hearing tomorrow afternoon. If anyone thinks I have screwed up please let me know!! I wonder if the judge will adjourn it re the missing statements?

Thanks

Goldlady

[iancognito]

Re: Repossession hearing next week

Can't see anything missing, think it explains everything precisely and you're right, quoting legislation doesn't always help, cap in hand is probably the best way to deal with this one.

Good luck with it, please let us know how you get on.

xx

[Sapphire]

Re: Repossession hearing next week

Good Luck hun, I'll be watching and waiting with fingers crossed for you and your friend.

sapphire