Accidental payment made to old debt

[nemesis45]

Re: Accidental payment made to old debt

£200

Ouch!!

I would make a Formal Complaint to Lloyds at director level ( find the name of the Retail Banking Director or similar title)
A Formal Complaint allows 56 days for investigation and response after which if the response is negative the FOS can be involved.

nem

[stevemLS]

Re: Accidental payment made to old debt

I would complain to the bank. They had no right to forward money on your behalf.

When they tell you to get lost complain to FOS.

M1

Personally, I don't think it is as clear cut as that.

They sold all their rights and liabilities in connection with the debt.

The debt remains, regardless of whether it is barred or not.

They had the right to receive payment, so on receipt they sent it to the third party who now holds that right.

Just a view.

[mystery1]

Re: Accidental payment made to old debt

Personally, I don't think it is as clear cut as that.

They sold all their rights and liabilities in connection with the debt.

The debt remains, regardless of whether it is barred or not.

They had the right to receive payment, so on receipt they sent it to the third party who now holds that right.

Just a view.

The debt remains with someone other than the bank. Put it this way, if the debt wasn't statute barred the bank would have right to sue. If you paid the whole amount to the bank the new creditor could still sue as they haven't been paid (unless of course the bank did the same as it just has obviously).

M1

[FlamingParrot]

Re: Accidental payment made to old debt

Personally, I don't think it is as clear cut as that.

They sold all their rights and liabilities in connection with the debt.

The debt remains, regardless of whether it is barred or not.

They had the right to receive payment, so on receipt they sent it to the third party who now holds that right.

Just a view.

I would be inclined to agree even though it's not what we'd all like to hear, :behindsofa: I certainly would have much better things to do with £200 than donating them to Lowell, :mad2: nevertheless it was a mistake by the OP to have made the payment into the wrong account and not Lloyds' fault. :mmph:

Yes clicked the wrong payee person, Lloyds

That's what I wanted to check, that Lloyds had no right in to forward the payment.

I can only assume there must be a contractual clause between the bank and Lowell stating that any payments made into the account would be transferred to Lowell as the new owner.

Statute barred in England and Wales doesn't extinguish the debt, it only makes it irrecoverable through the courts, however, the debt still exists and payments can be accepted. :ohwell:

[yellowplum]

Re: Accidental payment made to old debt

Ok, I have managed to take a closer look at the payments that have been made and when exactly they stopped.

The original debt was defaulted in 2007, payments had been made subsequently to the credit card account when it was still owned by Lloyds until 1 June 2012.

Then no payments or admission of the debt was made subsequent to that until the accidental payment the other day.

How does this change things?

[stevemLS]

Re: Accidental payment made to old debt

I'm afraid then it was not barred at the time you made the accidental payment and the effect of that payment will be to restart the 6 year limitation period.

Sorry.

[yellowplum]

Re: Accidental payment made to old debt

Ok I would ordinarily agree but it poses one other questions if you can answer...

I paid Lloyds and not the owner of the debt. It was then Lloyds who paid the card instead of returning the payment to me.

How does this affect the situation?

[Amethyst]

Re: Accidental payment made to old debt

You paid the credit card - not just Lloyds randomly. If you'd paid Lloyds to a different account entirely then you'd have an argument, but you paid the specific Lloyds credit card so made a payment to the debt.

Regardless of that you were paying up to 2012??- so you'd have another 3 years to go for stat barring anyway.

[yellowplum]

Re: Accidental payment made to old debt

You paid the credit card - not just Lloyds randomly. If you'd paid Lloyds to a different account entirely then you'd have an argument, but you paid the specific Lloyds credit card so made a payment to the debt.

Regardless of that you were paying up to 2012??- so you'd have another 3 years to go for stat barring anyway.

I understand the remaining three years, that's fine.

However, just for clarity and for my sanity, what you are saying regardless of who owned the debt at the time of a payment if you made a payment to a third party (which in essence lloyds is) then they chose to pay something off for you then that is acceptable and restarts any clock ticking?

[Amethyst]

Re: Accidental payment made to old debt

You made the payment towards the debt ( in error, I don't know if you have taken that up with Lloyds already though?) - you paid the original owner of the debt rather than the assigned owner - they will have an agreement in place to pass on payments towards the debt. The debt has been acknowledged by making the payment. You may not have acknowledged Lowell's ownership of the debt but to be honest that is really neither here nor there.

[nemesis45]

Re: Accidental payment made to old debt

I understand the remaining three years, that's fine.

However, just for clarity and for my sanity, what you are saying regardless of who owned the debt at the time of a payment if you made a payment to a third party (which in essence lloyds is) then they chose to pay something off for you then that is acceptable and restarts any clock ticking?

I have to agree totally, the late confirmation of payments maintained until 2012 completely negates the previous advice given.

I would suspect that Lowell will now start robust collection activity having now another 6 years to do it.

nem

[FlamingParrot]

Re: Accidental payment made to old debt

Ok, I have managed to take a closer look at the payments that have been made and when exactly they stopped.

The original debt was defaulted in 2007, payments had been made subsequently to the credit card account when it was still owned by Lloyds until 1 June 2012.

Then no payments or admission of the debt was made subsequent to that until the accidental payment the other day.

How does this change things?

Sadly what I previously said about it not making any difference for the purposes of limitation (even when you are still £200 out of pocket ) no longer applies. A debt that's already SBd cannot be 'un-barred' by making a payment but if payments were made in 2012 then it wasn't SBd to start with and your payment would have reset the clock.

It is true that a payment has to be made by yourself or by someone acting for you (such as a DMP provider) and not by a third party (such as the creditor themselves), however, in this case the payment was made by yourself from your own bank account, to Lloyds which was the original lender and it was passed on to Lowell the current owner.

I'm afraid then it was not barred at the time you made the accidental payment and the effect of that payment will be to restart the 6 year limitation period.

Sorry.

I agree. :ohwell:

Ok I would ordinarily agree but it poses one other questions if you can answer...

I paid Lloyds and not the owner of the debt. It was then Lloyds who paid the card instead of returning the payment to me.

How does this affect the situation?

Your account was originally with Lloyds and having sold this account, it would be theft if they were to keep the payment and not pass it on to Lowell, but it was a payment made by yourself rather than by Lloyds to Lowell without your authority. There would be a contractual agreement between them whereby any payments would be forwarded to them. A lot of people make reduced/token/DMP payments into defaulted accounts and are not always aware that the account was sold so they'd keep paying the original creditor. :ohwell:

[mystery1]

Re: Accidental payment made to old debt

There is nothing to lose and an upside of a refund by complaining. A payment via online banking is specific to an institution not just an account number. Lowell assignment letters also state you must use their details to pay.

M1

[yellowplum]

Re: Accidental payment made to old debt

There is nothing to lose and an upside of a refund by complaining. A payment via online banking is specific to an institution not just an account number. Lowell assignment letters also state you must use their details to pay.

M1

Thanks for everyones comments - I will wait a month and see if anything happens then complain to Lloyds to try and get the refund.

I also went through the old credit reports and had a question about this one - in a report from Equifax 22-06-2012 the Lloyds credit card appeared on the credit file. The Default date on the file is listed as 19-01-2007. An agreement to pay was in place however after the default date this doesn't appear anywhere on the credit file and the listing was subsequently removed after 2013.

If an agreement to pay exists should this not be updated on the credit file?

[FlamingParrot]

Re: Accidental payment made to old debt

Thanks for everyones comments - I will wait a month and see if anything happens then complain to Lloyds to try and get the refund.

I also went through the old credit reports and had a question about this one - in a report from Equifax 22-06-2012 the Lloyds credit card appeared on the credit file. The Default date on the file is listed as 19-01-2007. An agreement to pay was in place however after the default date this doesn't appear anywhere on the credit file and the listing was subsequently removed after 2013.

If an agreement to pay exists should this not be updated on the credit file?

See below from the Principles for the Reporting of Arrears, Arrangements andDefaults at Credit Reference Agencies although this is the new edition, those principles about arrangements to pay were much the same in the version that was used in 2012.

If, due to financial difficulty, your lender agrees a reduced or revised payment with you, thiswill be reflected on your credit file. How revised or reduced payments are shown on yourcredit file will depend on whether it is a temporary or permanent change to the agreement.

If your lender agrees to give you a temporary arrangement, but you fail to make the agreedpayment against the new terms, they may still file a default (see Principle 4 below) as soonas a payment is missed, as long you were at least 3 months in arrears on the originalagreement.

Unacceptable or Token payments
If your lender does not agree a reduced or revised payment with you because the amountyou offer to the lender is not acceptable, for example, a very low or token payment, theaccount will not be reported as an arrangement.Any payments you make will be reflected in the current balance, arrears will continue toaccrue and a default may be recorded.

4. If you fall into arrears on your account, or you do not keep to therevised terms of an arrangement, a default may be recorded toshow that the relationship has broken down.

In some cases people have AP markers for a long time before a default is recorded, so in your case it worked in your favour to have had the default recorded in 2007, because the whole thing's now gone forever. :thumb: