Default Re: Me V Bank - defective DN and unfair relationship defence.

[Pumpytums]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

I agree Mystery,
but and it's a big one the creditor should make sure the information recorded is accurate and updated regularly. Only one of my creditors does this bless them.

If it's not correct (or never happened) and they refuse to sort it out then I believe, sometimes the only recourse is via the county court.

Pumpytums

[pt2537]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

mystery

The creditor can report non-payments, but how can he get away with giving you a Default status following the issue of an invalid DN?

I have informed one of my OC's that their DN was invalid. They say they will re-issue, so I asked them what they intend to do about the trashing my file for the past 4 years. Their reply, so far, is to offer me £200, which I have rejected.

My point is that they are fully aware that they have slipped up, and to repair the damage could cost them a lot in damages.

Alan

Because you are in breach of contract, arent you? you stopped paying thus defaulted.

So he can place a marker of default even if he dont issue a default notice

Its often thought that the accrual of the cause of action is from when the creditor issues the default notice, it is no, see Glass vs Swansea City Council, which states it is from when he could sue that the cause accrues, and a creditor could sue you for arrears when they become overdue and thus that is also when he can mark your file that you have missed a payment,

It is approved by the ICO that 6 consecutive missed payments are when the creditor can place a D on your file to indicate you have breached the terms of your contract.

[Pumpytums]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

Pt quick question,
if a debt buying DCA marks your file with a D for 6 missed payments AND the OC marks your credit file with 6 missed payments for the same account what would that mean?

I also have a D for missing 2 payments?

Correction I just checked it was 1, that seems rather harsh.

Pumpytums

[diddydicky]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

Agree with most of that. However with your crf you didn't pay so if the info is accurate then they are within their rights (perhaps obligations) to report it.

Many of us are past caring about the crf though as it is beyond repair and the 5/6 years credit free will do us good.

M1

there is a difference between reporting missed monthly payments and entering a note on the CRA files that the debtor has defaulted on a £12,000 loan (for example)!

with a few months missed payments the debtor may have a chance to raise finance to clear the whole debt

with a defaulted £12K loan he has no chance!!

[Algee]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

pt

If an invalid DN is reissued, should it have the current date (giving you the 14 days from service) or the original date? If the original you can never rectify it, because you would already be out of time. If the current date, and you satisfy the notice, by paying arrears, then the creditor is unable to satisfy section 89 CCA, because what has been done, cannot be undone.

I accept that late payment markers could be left on with the CRA's, but you may have had several years of Default being registered, which until you have had a compliant notice issued (according to the Lending Code), should not be entered.

The ICO refers to the Banking/Lending Code, and assumes that the creditors issue compliant default notices, and abide by those codes.

Alan

[Algee]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

One other point, if the OC has sold to a DCA, then sets your balance to zero, takes back the account (because of a faulty DN), what then happens to the zero balance he has stated?

Alan

[New_Age_Biker]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

One other point, if the OC has sold to a DCA, then sets your balance to zero, takes back the account (because of a faulty DN), what then happens to the zero balance he has stated?

Alan

perhaps very Tax efficient

[Pumpytums]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

And there hangs a tale.

I had a OC sell off an account I would imagine they claimed the tax back against the shortfall.

They then bought it back, and carried on like nothing happened nice way to clean money that. I wonder if they paid the tax back that they claimed as a loss the previous year.

Pumpytums

[Lord_Alcohol]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

Because you are in breach of contract, arent you? you stopped paying thus defaulted.

According to the ICO, a default should only be recorded when the relationship between creditor and debtor breaks down permanently. If a DN is served and the breach is remedied, that "breach of contract" you mention is taken as not having occured (S89).

If the DN is so bad that it cannot be complied with, then the creditor has also breached the contract as it was regulated and he fails to observe the regs. As there is no Debit Reference Agency where the debtor can record this breach on the creditor's debit file, there is bias in the relationship which should become the focus of S140.

Moreover, where the creditor's definition of default is unsupported by the contract, the regs and the ICO, it is very odd to blame the debtor so comprehensively for "breaching the contract".

So he can place a marker of default even if he dont issue a default notice

Perhaps, but he nevertheless must;

1. Serve a notice of intent to file a default (usually carried within the DN itself), giving 28 days notice
2. Record a default which is fair and lawful (Principle 1 of DPA)
3. Record a default which is accurate (Principle 4)

It is approved by the ICO that 6 consecutive missed payments are when the creditor can place a D on your file to indicate you have breached the terms of your contract.

No, this is not the case. It is after 6 consecutive missed payments that the creditor can serve a notice of intent to file a default. The creditor may not just apply a D on any credit file without first serving this notice.

Not quite sure where this is going. I would have thought a bad DN carrying the notice of intent to file a D must be viewed in the same way as the DN itself, as the error in the default amount or time to pay may render the D inevitable and the creditor in breach of DPA principles 1 and 4, for which S13 of DPA can be used to seek compensation.

[Lord_Alcohol]

Re: Default Re: Me V Bank - defective DN and unfair relationship defence.

Thought this might be of interest, from the ICO technical guidance on filing of defaults for the credit industry (which is the reference currently used by Experian);

Para 4: The term ‘default’ on credit reference files is used to refer to the situation when the relationship between the lender and borrower has broken down. A record showing a series of payments as six months in arrears when this does not reflect the real payment history should not be used as an equivalent of a default.

Para 9: The term ‘default’, when recorded on a credit reference file should be used to refer to a situation when “the lender in a standard business relationship with the individual decides the relationship has broken down

Para 33: Notices to comply with Sections 13.7 of the Banking Code5 and 7.5 of the Lending Code6 should provide adequate warning. A notice of intention to file a default can be sent with a formal default notice served under Section 87 of the Consumer Credit Act 1974.

Para 42: Lenders are faced with difficult decisions when considering recording defaults which are disputed by the customer. It is not our role to arbitrate in disputes between borrowers and lenders. However, when we consider complaints, we will conclude, where there is clear and sufficient evidence that a default has not occurred, that it is likely that the lender has not complied with the data protection principle which requires that personal data are accurate.

Para 43: If we conclude that there is a genuine, reasonable and unresolved dispute between the borrower and lender, then we are likely to find that personal data have been processed unfairly if a default has been filed.

As the Tech Guidance refers to the Lending Code (which the big names subscribe to), it's worth looking at this;

http://www.lendingstandardsboard.org...endingcode.pdf

And especially;

Para 40: Subscribers can give CRAs default information about a customer’s debts if:

• the customer has fallen behind with their payments;
• the amount owed is not being disputed by the customer; and
• the customer has not made a proposal that satisfies the subscriber for repaying the debt following the subscriber’s formal demand

(My underline above)

Para 41: But, in all cases, the customer must be given further notice of the intention to disclose the information at least 28 days before the disclosure is made (for example, when a default notice or formal demand is given). At the same time, customers must be given an explanation about how default information registered against them may affect their ability to obtain credit in the future. This notice will mean that customers have 28 days to try to repay or come to some arrangement with the subscriber before default information is passed to the CRA.

Para 42: For the purposes of the second bullet in paragraph 40, a customer dispute is relevant if it refers to the amount of money owed by the customer and is genuine, reasonable and unresolved.

So, any lender adhering to the Lending Code must send a notice of intent to file a default at least 28 days beforehand. Moreover, both the Lending Code and the ICO both state that no default should be filed where the amount is disputed.

It seems to me that banks are trying to outdo each other in seeing how many regulations and codes they can break and still get a judge to award a money order. But anyway there it is in black and white, so maybe useful in seeking compensation under S13 of DPA.

HTH