Termination and issuing of a default

[orfoster]

Hello all,

Wonder if you can help me....

Last year my gf terminated her HP agreement and gave the car back as per her stat rights but I've since discovered that she's been issued a default on her credit file. Now the organisation say they don't hold a default notice, I've said that they have to provide one under s88 of CCA, they say that because she voluntarily terminated the agreement they don't need to issue under s88 a default notice.

Is that correct? Surely you can't be penalised for exercising statutory rights?

Are they pulling my leg?

[Guest]

Re: Termination and issuing of a default

Was she i arrears when she VT'd the vehicle.

It must be remembered that the Issuance of a notice under the consumer credit act has nothing to do with the recording of a defaulted account.

If she had not been in arrears when she VT'd however they should not have placed a default marker on her file, although they are allowed to record the VT.

[orfoster]

Re: Termination and issuing of a default

I need to check, but in May called to say she couldn't afford to pay due to ending one contract and starting another at work and if they would allow her a payment holiday, they wouldn't help her so she didnt pay. Then she called back a short while later to VT the vehicle although there are all sorts of issues from this point but really it's the default on with the CRA's that's the issue. They registered it at the incorrect balance until just recently as well.

I thought they had to serve the notice to put the default on your credit file? Am I wrong? I thought they also had to give you the chance to put things right? And send the OFT fact sheet with it? They did serve a notice under 86E of a notice of default sums so I would have thought that if they did that they should have served a notice under s88?

But I'm really no expert but want to understand what they should have done etc.

cheers

[Guest]

Re: Termination and issuing of a default

I need to check, but in May called to say she couldn't afford to pay due to ending one contract and starting another at work and if they would allow her a payment holiday, they wouldn't help her so she didnt pay. Then she called back a short while later to VT the vehicle although there are all sorts of issues from this point but really it's the default on with the CRA's that's the issue. They registered it at the incorrect balance until just recently as well.

I thought they had to serve the notice to put the default on your credit file? Am I wrong? I thought they also had to give you the chance to put things right? And send the OFT fact sheet with it? They did serve a notice under 86E of a notice of default sums so I would have thought that if they did that they should have served a notice under s88?

But I'm really no expert but want to understand what they should have done etc.

cheers

They only need to send you a default notice under section 87 if they are going to take proceedings against you to recover money due under the contract or the vehicle, this would not be needed in your case.

The creditor should send you a notification that they were going to place a default marker on your file, but this is a different procedure and is only a guideline initiated by the ICO.

You need to find out if the car was in fact voluntary terminated under section 99/100 of the act or if it was voluntarily surrendered, also if any monies are still due on the account.

[orfoster]

Re: Termination and issuing of a default

Morning Andy,

Thanks.

Ok here's the story.

We have got all relevant documents through a SAR.

On the day the car was repossessed I'd had advice that the finance company should have done more to help me while I'm in difficulty so when the guy arrived I told him that I didn't want the car to be repossessed. I went back in the house to call my bf and when I came back out he was finishing off taking the car. He completely ignored me and asked me to sign nothing on the damages report and the repo summary it says 'no one to sign' they then stuck damages on which I complained about at the time but they filed my complaint but didnt respond.

Ultimately I want the default off my credit file because I feel they treated me badly.

I don't owe anything anymore because after they sold the car I set up a repayment plan.

Im seeking a refund of the damages they put on too which are about £350 too.

Cheers

[orfoster]

Re: Termination and issuing of a default

The default was placed on my credit file a couple of months after the agreement was terminated. And they continued to do so until the payment arrangement was fully repaid. When does the legal agreement end?

[Guest]

Re: Termination and issuing of a default

yes unfortunately the credit record will reflect the adherence to the contractual payments util all sums due under it are settled. Once the amalgamated arrears exceed three months they are entitled to enter a d on your file, they should keep sending you bi monthly sums of arrears notices though under section 86.

[orfoster]

Re: Termination and issuing of a default

Hi Andy,

No sums of arrears notices, all we have is a "Notice of default sums" under 86E with just a collections management charge on it, they only sent one letter with the arrears of 1 payment on it, before the car was auctioned and they passed the account to Equidebt to be collected. I thought while we have you on the thread whether we could ask some specific questions;

1. Should MotoNovo have provided DSAR information from Equidebt as their external agents about the account (we don't have anything from them at all).
2. The issue that we never received the final report despite requesting it at the time from MotoNovo with the damages on it which was of course unsigned by us as the car was taken.
3. The gf told them at the point of repossession that she didn't want them to take the vehicle but they did hence why they didn't get her signed consent at the time. Was the repossession therefore unlawful?

Many thanks.

Orfoster

[Guest]

Re: Termination and issuing of a default

HI

I think putting the other matters to one side for a moment, I was under the impression from your first post that the car was voluntary terminated or surrendered.

I see that in in a later post you refer to the car being re-possessed, theses are different procedures, if the car has been re-possessed(without the keepers consent) and the hirer has paid over one third of the total contract price then they would need a court order, in any case they should serve a default notice under section 87 of the cca, to re-posses a car in breach of these provisions can have severe consequences on the finance company.

So we need to establish if the agreement was terminated by consent or if it was repossessed, and in addition how much was paid off the agreement.

Andy

[orfoster]

Re: Termination and issuing of a default

Hi Andy,

Ok letter sent May 2011 -

It comes with regret that I am no longer able to make repayments of £176.46 on the above vehicle. Having tried to have a payment break whilst being employed on a sporadic basis and being told I could make half payments for 3 months, but would then would need to add the halves back on to the next three months payments is ridiculous as I cannot afford £264.49 for those three months. I am also not able to find the settlement figure, nor want to part exchange the car for something else, so I feel my only option is to have it recovered and then set up some sort of payment plan to pay any negative equity that comes up once you sell it at auction. Please now contact me by letter or telephone with confirmation of this letter and the steps I now need to take to have it recovered from my address.

TOTAL PAID £2649.54
TOTAL DUE £8489.51
33% is about £2800!

They did all the VT stuff and sent the letter of voluntary termination but she got advice on the morning of the day the car was taken and in her letter they sent her it said that she didn't have to have the car taken she could withdraw at any time but would have to pay the abort fee of collection so when he turned up she said "No I don't want the car to be taken, I want to continue with the agreement or get more advice as I don't think MotoNovo have done enough to help me". He said, "You have no choice the cars going" Hence why none of their required documentation was signed at the time the car was taken because by the time she went back outside from speaking to me the car was gone! She wrote in (copy on their file) saying you took the car and have sent me a list of damages, I haven't seen sight of this report and it is clearly unsigned as I signed nothing! They never replied.

I've been having a read of Chartered Trust Plc v King (2001) WL 172107 they decided that the debtor is entitled to a return of all of the money paid to the creditor.

Does the above help? Sorry I should have been clear from the start about the issues here.

You say in any case they should serve a default notice under 87 of CCA, is that even with the above? Because they admit they didn't do that.

[Guest]

Re: Termination and issuing of a default

Hi Its Ok

The problem will be proving that the car was taken without the consent of the hirer, speaking objectively the court may regard the letter as compelling evidence that on the," balance of probability" the hirer intended to return the vehicle, this is an opinion only.

As far as the law/act is concerned, if the creditor intends to enforce a term of the agreement upon breach(none payment), then they must issue a default notice, this is before they are, "entitled to" terminate the agreement and take possession of the goods, this is irrespective of how long the debtor has had those goods.

If the debtor has paid over one third of the value of the goods the creditor must in addition get an order form the court to reclaim them without the hirers consent.

Turning to the sums due on return of the vehicle, if the car was VT'd then one half of the total due under the agreement would be due, this includes any arrears(in your case). If the car was voluntarily surrendered, then the full amount under the agreement would be due, less the amount raised upon sale and then less any rebate due under the early settlement regulation.

If you want to give me all figures I will calculate the sums for you.

Sorry not to be of more help, but in these cases it comes down to who the court believes at the end of the day.

Andy

[orfoster]

Re: Termination and issuing of a default

As far as the law/act is concerned, if the creditor intends to enforce a term of the agreement upon breach(none payment), then they must issue a default notice, this is before they are, "entitled to" terminate the agreement and take possession of the goods, this is irrespective of how long the debtor has had those goods.

From the above, just to clarify, they have to issue a default notice in all cases or just where they want to enforce something? i.e because we VT the car they don't need to enforce anything and therefore they don't have to issue a default in accordance with 87 (1)?

What I will do is scan up the statement of account they have recently sent with all the information on it so I don't get any of it incorrect etc.

Cheers

O

[orfoster]

Re: Termination and issuing of a default

Hi Andy,

Please see the attached PDF of the balances of account.

I see that there are also some charges on there.

Is that all you need? If you want to know the figures on the agreement I can post these up (the actual copy of the agreement is very poor to scan and post up).

Oli

[Guest]

Re: Termination and issuing of a default

From the above, just to clarify, they have to issue a default notice in all cases or just where they want to enforce something? i.e because we VT the car they don't need to enforce anything and therefore they don't have to issue a default in accordance with 87 (1)?

What I will do is scan up the statement of account they have recently sent with all the information on it so I don't get any of it incorrect etc.

Cheers

O

No if it is a Vt or VS it is at the hirers instigation, so no notice is required under the statute.

[Guest]

Re: Termination and issuing of a default

OK I will have a look and get back