HBOS O/D DN - 07/11

[Undercover Elsa]

The ink is still wet on this one. Missing the OFT paragraph and no OFT leaflet enclosed.

• Type of DN: OVERDRAFT
• Date Received: 20/07/11
• Arrears £ 3575.49
• Balance £ 3575.49

Remedy date 15th August but have just received a letter dated 29th July stating that as
I haven't paid the arrears on the default notice by the due date "we have now ended your credit agreement"







History of this OD is that this was my main account until Dec 2008 when my supposedly "guaranteed for life" pension was stopped due to NHS maladministration. I subsequently opened a parachute a/c but left a small superann pension going into the Hx a/c. Other than that it's been totally inactive.

When they changed over to their new charging regime, for some reason they stopped charging me the usual interest but didn't add the new charges either for several months. The balance was under the arranged OD Limit of £3,500 and my monthly payments were reducing it nicely. I (rather naively) thought they did this to enable the debt to be cleared.

Without notice they then started adding arranged OD fees, so the balance started rising again.
However, they were champing at the bit with this one and in May this year, while I was still under the arranged limit, they cancelled the overdraft, thus enabling themselves to charge £5 a day unarranged OD fees. Nice one.
I promptly cancelled the monthly payments as I wanted them to default and terminate it as quickly as poss to stop these fees being added.
I've paid at least £1000 in since I stopped using the account. They've added well over a grand in fees. I've been getting 2 threatening letters a week (since May) and had around 20 attempted phone calls.

In progress...

Shepherdess x

[Undercover Elsa]

Re: HBOS O/D DN - 07/11

All quiet as they wait with baited breath to see if I cough up by 15th August.

Can't wait to renew my acquaintance with Blairforce 1, the most inept collections department on the planet.

Anyone have any ideas about how these Halifax-conceived daily charges fit in with the scheme of things in terms of the Govan route?

Difference with these of course is that they are not in response to individual transgressions such as failed DD's, just a blanket charge limited only by the number of days in a month.
Inescapable even if you do nothing wrong other than not capitulating with mein Fuhrer von Halifax demanding immediate full payment.

Had these conditions been in place before I opened this account or took on the overdraft, I wouldn't have touched it with a bargepole tbh.

[Miss Molly]

Re: HBOS O/D DN - 07/11

Not quite sure what you can do here. It seems a bit odd that they waited so long before starting to apply the new charges. Were you given the opportunity to move to a non fee charging account ?

Halifax seems to leave things in place for quite a long time before defaulting, I guess in order to ramp up the debt in order to sell it on

[caspar]

Re: HBOS O/D DN - 07/11

Hi Shepherdess - do you have the T&C's or a link to the T&C's.

While I understand that a bank can cancel an overdraft at any time, I find it somewhat strange that they did this while you were under your agreed limit.

If you can point us to the T&C's or name of the account so we can look them up, then we can have a poke around for you.

Halifax are notoriously pains in the neck to deal with as I'm sure you know.

[Undercover Elsa]

Re: HBOS O/D DN - 07/11

Hi Folks
Thanks for the responses.
It's just the standard current account, Casp.
Here's the link re fees. The previous fee structure is linked on that page.

I wasn't offered any other account, Miss Molly. Just got a template letter re the fees saying basically if you don't like it pay up and Bog Off. I wasn't particularly in a mood to communicate with them at that time, still bruised after losing my income and, frankly, scared to death at my own temerity in stopping all non priority payments and doing a moonlight to a parachute account. (Till I found certain forums and learned my rights )
So I let it ride with the monthly payment going in, and kept my head down.
No idea why they didn't add the charges for several months, then started them without a word.

They have created an ingenious licence to print money. If those charges suddenly went up to £10 a day, by their past record they'd get away with that too unless we can find a legal argument to scupper it.

[caspar]

Re: HBOS O/D DN - 07/11

These are taken directly, word for word, from the Lending Code March 2011 to which the Halifax, as a responsible lender, has subscribed. At the bottom I have outlined a letter which I have used on behalf of clients with success in the past. Hope it may help.



97 Subscribers should tell customers personally at least 30 days before increasing an overdraft charge or introducing a new overdraft charge.



179 Personal customers should be considered to be in financial difficulty when income is insufficient to cover reasonable living expenses and meet financial commitments as they become due. This may result from a change in lifestyle, often accompanied by a fall in disposable income




183
Signs or indicators that a personal customer may be at risk of being in financial difficulties may include:

regular unarranged overdrafts

change in account behaviour such as significantly reduced credit turnover;




185 Subscribers should consider a range of solutions to assist personal customers who are identified as being at risk of being in financial difficulties, which may include:

Promotion of availability of opt out from unarranged overdrafts (where offered – see Section 5)


Agreement to a formal arranged overdraft, subject to affordability assessment.


Charges and interest concessions



214 Where the subscriber considers the customer’s personal and financial circumstances to be exceptional and unlikely to improve, the subscriber may, among other options, consider writing off or not pursuing part or all of the customer’s debt(s). Where write-off is requested by a customer or adviser but is not considered appropriate by the subscriber, the subscriber must give their reasons in writing. If the subscriber agrees to a write-off, then the debt may be registered as a default with the credit reference agencies.




224 Subscribers should consider reducing or stopping interest and charges when a customer evidences that they are in financial difficulties. Such reduction/suspension decision should be based upon an income and expenditure statement indicating that they are unable to make repayments sufficient to meet contractual terms. Where a customer is able to make only token payments, their debt should not increase as a result of interest and charges levied. The assessment should reflect the customer’s lack of ability to pay rather than the stage an account has reached in the arrears cycle or whether they are using free sources of debt advice. Where a firm declines to allow concessions, they should be prepared to explain why to the customer or their adviser if requested to do so.




225 It is inappropriate for interest and charges to continue to be taken where the result would be that the repayment period for the customer becomes excessive. In forming a judgement on what might be excessive, a subscriber should take into account the type of product and the individual circumstances of the borrower.







Dear Sir,


Your ref:


I am writing with regard to the above account. You will be aware that I stopped paying into the account when you started applying fees without any notice in direct contravention of Paragraph 97 of the Lending Code.



I would like to arrange an affordable repayment plan for this, but am nervous of any communication with you as you appear to have total disregard for the Lending Code, to which, as a responsible lender, you have subscribed.



I will mention just a few of many breaches which have occurred. I would be grateful if, in your reply, you could address each of these in turn.


Firstly the Lending Code gives a list of indicators which should make you aware that a customer is suffering financial difficulties. How, as a responsible lender, did you fail to pick up on these?


The code states you should consider a range of solutions for customers identified as suffering financial difficulty. What solutions have you, as a responsible lender, considered in my case?


The code states it is inappropriate for interest and charges to continue to be taken where the result would be that the repayment period for the customer becomes excessive. Why, as a responsible lender, have you continued to apply these charges to my account?

And so on....

Before I end, I would like to remind you of my opening paragraph which asks you to respond to each of the above points in turn. These are just some of the breaches of the Lending Code, among many others I could have cited. As you can see the errors on your part have been substantial.

I look forward to your response, along with what you would suggest as a resolution. I would imagine a good start would be to remove all charges so that we can begin negotiations from the position I was in before you started applying charges without giving me the requisite notice.

Yours faithfully,

There may of course be a template letter which covers this here, I don't know. If so, perhaps someone will be able to point you towards it.

[Undercover Elsa]

Re: HBOS O/D DN - 07/11

Nice one, Casper - thanks for that

I'm waiting to see what they say next, and there's definitely lots of stuff I can use there in my response.
I also want to get them to justify in writing what exactly costs £150 a month to run a dormant account, without even a current debit card or online access, whereas those customers with active accounts are clearly costing them much more, if they have DD's, bounced cheques etc, yet are charged the same as me.....

[Undercover Elsa]

Re: HBOS O/D DN - 07/11

Morning M'dears,
Just to update this, they terminated the account without even waiting for the (faulty) DN to expire.
Last statement received and the charges have now ceased. So it's taken roughly 3 months since they cancelled the OD.
All is quiet. Waiting for them to bring on the Blair Bitch Project....