Default Notice ( Provident )

[mejjo203]

Hi all,
I'm just here today to ask if Provident are required to send a notice of default giving a set period of time ( 7-14 days ) to rectify the situation of the debt before registering it as a default with the credit reference agencies?

[nemesis45]

Re: Default Notice ( Provident )

Hi Welcome to LB,

Is this a loan account?
Yes you should have a default notice.

Provident's " paper work" and administration have always been chaotic to say the least.
Do have / Did you have an agreement stating the account was " A credit agreement Regulated Under CCA 1974"?
nem

[FlamingParrot]

Re: Default Notice ( Provident )

Hi all,
I'm just here today to ask if Provident are required to send a notice of default giving a set period of time ( 7-14 days ) to rectify the situation

S.88(2) of the Consumer Credit Act states at least 14 days:

(2)A date specified under subsection (1) must not be less than 14 days after the date of service of the default notice, and the creditor or owner shall not take action such as is mentioned in section 87(1) before the date so specified or (if no requirement is made under subsection (1)) before those 14 days have elapsed.

It used to be 7 days but that was before October 2006:

SCHEDULE 2PROVISIONS COMING INTO FORCE ON 1ST OCTOBER 2006
Provisions Subject Matter of Provisions
Section 14(1) Substitution of 14 days for seven days where it occurs in section 88 of the 1974 Act (contents and effect of default notice)

of the debt before registering it as a default with the credit reference agencies?

The CCA requirement refers to further action taken by the creditor which does not include registering defaults with the CRAs:

87 Need for default notice.
(1)Service of a notice on the debtor or hirer in accordance with section 88 (a “default notice ”) is necessary before the creditor or owner can become entitled, by reason of any breach by the debtor or hirer of a regulated agreement,—
(a)to terminate the agreement, or
(b)to demand earlier payment of any sum, or
(c)to recover possession of any goods or land, or
(d)to treat any right conferred on the debtor or hirer by the agreement as terminated, restricted or deferred, or
(e)to enforce any security.

Reporting to the CRAs should be according to the Principles for the Reporting of Arrears, Arrangements and Defaults at Credit Reference Agencies. The lender is supposed to give you 28 days notice before filing a default. In many cases the DN issued under the CCA also serves as notice to file a default.

4. If you fall into arrears on your account, or you do not keep to the revised terms of an arrangement, a default may be recorded to show that the relationship has broken down. As a general guide, this may occur when you are 3 months in arrears, and normally by the time you are 6 months in arrears. There are exceptions to this which may result in a default being recorded at a later stage, such as secured or long term loans e.g. mortgages, or if the product operates in a more flexible way e.g. current accounts, student loans, home credit.

If an arrangement is agreed (see Principle 3 above), a default would not normally be registered unless the terms of that arrangement are broken. Apart from being 3 or more months in arrears there are other circumstances which may lead to the recording of a default:
1. Property such as a house or vehicle has been repossessed or handed back with no indication to pay a remaining balance.
2. The provider takes steps to cut off a service.
3. The account is in arrears and the provider receives an indication that you have left your address without notifying them.
4. Evidence of fraud.
5. The account is or has been included in a bankruptcy, CCJ, Individual Voluntary Arrangement (IVA) or similar.

The lender must have notified you of their intention to register a default against you at least 28 days before doing so, in order to give you time to make an acceptable payment or reach an agreement with them on an arrangement. This also applies in cases 1 - 3 above. However, in 4 - 5 the lender or provider does not need to provide a notice and can file a default as soon as they become aware of the situation.

Lenders will report the default amount and the default date to the CRAs.

[jon1965]

Re: Default Notice ( Provident )

There is no need as such to supply a default notice as per s87 before a default is registered but as the parrot said they should give you notice of registering a default. This as far as I know does not have a set format (unlike a DN) so could be in a few lines of another letter.

I am am assuming this is one of their door step loans, what they should do is issue a DN prior to selling the debt on or issuing a claim. With me they first registered a default and then later issued a DN before selling my debt to BCW who I have not heard from in a while. With me I believe they goofed by rolling several loans up ,with slightly different terms and defaulting it as one

[Nibbler]

Re: Default Notice ( Provident )

http://www.legalbeagles.info/forums/...ble-agreements

CRA Default on a credit file Vs default under the CCA

I was not sent any default notices, should the default on my credit reference file be removed?

In most cases, the answer will be ‘no’, provided that adequate fair processing information was provided when the account was originally opened.

It may help to explain that a “default” on an individual’s credit file does not mean that an individual has been defaulted under the Consumer Credit Act; essentially, the same word is being used to describe two slightly different things (which can obviously lead to some confusion). Instead, a “default” on a credit file simply means the lender considers the relationship between itself and the individual to have broken down.

Therefore, whilst it may be a requirement of the Consumer Credit Act to issue default notices, there is no DPA obligation on a lender to issue a default notice to individuals before marking an account as being in default on their credit file. Although we advise that it is good practice to issue a notice, lenders will often have provided individuals with fair processing information about defaults and notices in the terms and conditions when the account was opened. Provided this was the case, then it is likely to satisfy the “fairness” aspects of the first principle.


CRA Defaults - Guidance for filing defaults

Updated guidance for filing defaults with credit reference agencies was published on 1 January 2014.

The official site can be accessed at http://www.scoronline.co.uk/key_documents/ and the relevant document is entitled Principles for the Reporting of Arrears, Arrangements and Defaults at Credit Reference Agencies.

This is not the ICO’s guidance but a new document drawn up by the credit industry in consultation with the ICC which is now intended to be the main source of information for the public on this topic.

This may create some impact on calls to the Helpline or complaints received where an individual is concerned that a default has been registered incorrectly on their credit reference file.

Although the new guidance does not cover this in any depth, it is important to make individuals aware that there is a difference between a ‘default notice’ and a ‘default’ registered on a credit reference file.

A ‘default notice’ is a communication a lender should usually send to a borrower before defaulting a credit agreement regulated by the Consumer Credit Act (CCA). There is not necessarily any DPA obligation on a lender to issue a default notice to individuals.

Although we advise that it is good practice to issue a notice, lenders often provide individuals with fair processing information about defaults and notices in the terms and conditions when the account is opened. If this is the case then this is likely to satisfy the “fair” aspect of the First Principle.

The term ‘default’ on credit reference files is used to refer to the situation when the relationship between lender and borrower has broken down, and this scenario is explored in more detail in the updated guidance on defaults.

So essentially, the absence of a formal ‘default notice’ would not prevent a default from being registered on an individual’s credit reference file. If there are outstanding payments or arrears in respect of a loan or other account then an organisation would be within its rights to record this at the credit reference agencies. Providing the information recorded is an accurate reflection of events then the Fourth Principle would not be contravened. Legislation DPA

[FlamingParrot]

Re: Default Notice ( Provident )

The official site can be accessed at http://www.scoronline.co.uk/key_documents/ and the relevant document is entitled Principles for the Reporting of Arrears, Arrangements and Defaults at Credit Reference Agencies.

I had also bookmarked that link but it has now moved to http://www.scoronline.co.uk/sites/de...ment_final.pdf

[Nibbler]

Re: Default Notice ( Provident )

Thanks. Hadn't noticed it had moved, as I normally refer to a version where the text has been converted to easier format.