s.89 - what does it mean?

[jax50]

Re: s.89 - what does it mean?

I had made a couple of reduced payments to the bank in question and this amount was taken off of the new DN amount needed to remedy.

Interesting. I've been making payments for 4 years...wonder if they actually owe me money in this scenario..lol. What about the outstanding balance as opposed to the amount paid to remedy ? Is that still due and would that involve another repayment plan as such...?

[teaboy2]

Re: s.89 - what does it mean?

This happened to me, I satisifed the new DN and the claimant was forced to withdraw and I got costs.

Who was the claiment? DCA or original creditor?

[toomanycalls]

Re: s.89 - what does it mean?

Who was the claiment? DCA or original creditor?

Original OC

[teaboy2]

Re: s.89 - what does it mean?

Right well in that case, as per the consumer credit act, once the Debtor settles the Defualt Notice in time, then the creditor has to treat the Default as not having occurred. So the agreement would continue as normal.

The main debate is regarding what happens when it is sold to a DCA and a new DN (which is then satisfied by the debtor) is issued by DCA or Creditor after it is sold off the back of an invalid one.

[jax50]

Re: s.89 - what does it mean?

Right well in that case, as per the consumer credit act, once the Debtor settles the Defualt Notice in time, then the creditor has to treat the Default as not having occurred. So the agreement would continue as normal.

The main debate is regarding what happens when it is sold to a DCA and a new DN (which is then satisfied by the debtor) is issued by DCA or Creditor after it is sold off the back of an invalid one.

Well it is certainly very confusing..but interesting... has the agreement been terminated or not ? Is it repudiation ? Has it been sold as a live agreement to a unlicensed DCA ?

[patrol30]

Re: s.89 - what does it mean?

Hello everyone,
sorry if this is an intrusion into this thread but this seems to be the most current debate about defective DN. I am very early on in the process but I have just receive two defective DN from the halifax. The first is defective as they do not allow 14 days notice but is still within the deadline and the other as their in house debt collectors demanded full payment before the DN expired.

I assume that these are indeed defective and only one is actually terminated. Or that is my question from my research it now appears that it is not terminated due to the termination being carried out on the back of faulty DN. previously I read on various forums that I should write to them confirming acceptance of the illegal termination, is this still current advice?

If not when do I inform them of the defective Default Notices?

lastly, although they have passed the debt to an In house collector is this equivalent to selling the debt on as I know they are not licensed?
Thank you in advance for any help I'm going as fast as I can bringing myself up to date.
Ps I'm in Scotland if that changes anything.

[Lord_Alcohol]

Re: s.89 - what does it mean?

I'm beginning to think that lenders are just uninterested in observing ss.87-89. It seems to me that once a borrower has failed to make payments then that's it, the game's up.

Personally patrol30 I would do nothing until you get the court papers. If the DN is defective they will not be able to enforce - all they will be able to do is serve a new DN with the original arrears (unless you've received s.86C notices in the meantime), although they may just terminate once their mistake is sorted.

I would not talk about "illegal termination" - the word illegal indicates to me at least that this is a criminal offence, when it isn't (it's a civil matter). Whether your agreement is actually terminated is a different question - I haven't got a clue.

LA

[patrol30]

Re: s.89 - what does it mean?

Thanks Lord Alcohol,
My current situation is improving and by the end of next year I will actually have the money to pay off the lot. I would be very reluctant to do this as they have defaulted me and there is no incentive to pay.

what would happen if I did let it go to the court stage and then revealed the defective DN's. I am of the understanding that they would then issue a new DN, so I then pay the arrears. If this was to happen then its my understanding that all enforcement actions including entries into the credit reference agency's would have to be removed.

I also would like to know if the debt was sold would the new organisation be able to honour the original agreement, especially on the credit card. Where do they also stand with data protection as if the agreement is not actually terminated do they have the right to pass on your data? Most of these ideas I remember reading but not sure if it was on here so apologies if this has been discussed.

[Lord_Alcohol]

Re: s.89 - what does it mean?

If this was to happen then its my understanding that all enforcement actions including entries into the credit reference agency's would have to be removed.

Not sure about the other stuff patrol30 but as far as the above is concerned this may not be correct. The ICO requires a data controller to notify the debtor of a default 28 days before it is registered on your credit file - that notice is often (usually?) contained within the DN, hence the 2 separate timescales (14 days for compliance with s.87, 28 days for compliance with the ICO's requirements).

Unless the DN is so duff that it compromises the 28-day default registration notice, it is quite likely that the lender will record the default and then refuse to remove it. The CRA's will not remove it without the lender's approval. You could seek a DPA s.10 order from court to have it removed but the lender's argument will always be that you defaulted on your agreement, notice was given and therefore it was fair to record the default.

You could argue that the DN was so duff the registration could not be avoided, and was therefore unfair (princple 1 of the DPA) and inaccurate (principle 4), although the inaccuracy needs some arguing!

BTW, only a licensed firm can offer a regulated credit agreement, but I think this can be circumvented by the OC serving a non-default termination notice anyway and then selling the debt to whoever they want, licensed or not. They may do this if you satisfy a corrected DN, although they do have to justify their reasons for termination (but knowing the banks they will think of something!) as per the EU CCD, effective 1/2/11.

HTH
LA

[jax50]

Re: s.89 - what does it mean?

If a defective DN was corrected, would this be retrospective to the original date, or would it start from the date of the correction and the 6 year period would start again ?

[patrol30]

Re: s.89 - what does it mean?

I honestly think this need looked into a bit more as i feel the lenders have taken this too lightly. I just cannot understand how the lenders routinely get the default notice wrong it like they do it deliberately.

From the more advanced members would it be possible to put together some templates to test this out. From my point of view i have nothing to lose by trying it out worse come to the worse i would let them issue a new DN and pay of the arrears.

[patrol30]

Re: s.89 - what does it mean?

Teaboy 2,

Do you have a template for the letter you sent to MBNA as i think thats my next move?

[teaboy2]

Re: s.89 - what does it mean?

As its still with their in house debt collectors, do not do anything just yet as you have a better strangle hold over them once they sell the account, as if you did anything now, they would just simply reissue a Dn that is Valid and the if you can afford the repayments even after remedying the DN your screwed. Where as if you waited for them to sell, you can simply inform them the original DN was invalid and reasons why and request the new owners of the account to reissue a DN that is vaild. Then once you receive it, pay the arrears (which is all they can ask for on a DN) then wait for them to start hassling you for the rest.

Then send them a letter reminding them that under section 89 of the consumer credit act, that as you remedied the Valid DN that they reissued they most treat the default as not having occured and therefore return to account to the full operational status it was in prior to the default occuring, this means reactivating the credit card and allowing you to continue to use the card as though the default had not occured, if thay do not do this within 7 days, then you will deem the oweners (whoever buys the account) to be in repudiation of contract and therefore not entitled to the remaining sum in law, nor are they entitled to enforce any rights under the contract they are in repudiation off, or record any adverse notes, default or history on your credit file. Note - You can not do above if the original creditor still owns the account and the whole thing relies on the fact that DCA's do not have the facility to provide you with an operational credit card account like the original creditor could.

Off course if its a loan that you owe, well they would have to allow you to continue to make your monthly repayments as per the original repayment terms, if they as for full amount then send the same above type of letter but word it differently to reflect that they are not entitled to demand payment of sums not yet due, and are only entitled to receive payments as per the loan agreement repayment schedule in the original agreement. Demanding full repayment is repudiation of contract, and they are therefore not entitled to anything but arrears currently owed if any (which of course their will be no arrears).

Basically the above is a way of giving them just enough rope for them to hang themselves with inregards to legal catch 22 situtation that the above puts them in!

[patrol30]

Re: s.89 - what does it mean?

Thank you teaboy2, that's exactly what i will do nothing to lose worse case scenario i just pay it off.

[teaboy2]

Re: s.89 - what does it mean?

Exactly, but if the DN you have are truely invalid, then once they sell the account they'd be doing you a favour as all youd have to do is ask them for a valid DN as the previous ones where invalid, and then simply pay of the arrears, and if they come after you for the rest. Simply say well, your in breach of section 89 as you failed to return the account to the standing it had prior to the default by the debtor upon the debtors remedy of the valid DN dated xx/xx/xx as such your not entitled to claim any other sums that would have now been due but not due at the time of default or sums not yet due, as a result of your breach of section 89 putting you repudiation of contract.

They will whinge and squirm like god knows what when you tell them that and will through all sorts of irrelevant case law at you that is normally used and only relevant to other situations and do not cover this kind of situation. As their is no case law for the situation you'd be in as the simple fact is, if it went to court, they'd lose outright and they know it! Hence why its a catch 22 situation for them!