MBNA Termination

[simon]

HI
My Mrs Has had a couple of credit cards with MBNA( one is the Virgin brand) since 2005.
IN 2005 I noticed that she had been paying PPI so I rang them and they said yes she asked for it.
So I sent them a CCA, she had never missed any payments on either accounts and she had bags of credit on both.
We went to the petrol station shortly after and when we tried to pay , the card (MBNA) was declined.
Obviously they had construed my CCA request as being a precursor to an unenforceability claim and thought they would stop the account before I could flatten it out.
I sent a very stiff letter to their complaints department, and shortly after received an apology, stating” I am very sorry for our conduct in this matter and I assure you this is not the way we do business” I still have the letter. Also stating that they would of course re- instate the card.
Of course they didn’t. This resulted in a flurry of letters by yours truly to the FOS and anyone I could think of, of course they got me nowhere, because basically they were entitled to terminate the agreement whenever they like.
Then I did a stupid thing, in a fit of pique I stopped making the minimum payments. This resulted in them terminating the other account (virgin) which had never been in arrears and we had never missed a payment on.
For the last 6 years we have maintained payments on both accounts at the minimum payment rate.
I recently sent them a letter asking them to clarify exactly what the statuses of the accounts are, terminated, account withdrawn or what. To date I have had no response.
Looking at the agreement there is not mention of post termination interest or their ability to charge it.
There is the usual clause that says that the creditor can terminate at any time and on termination all liabilities under it become due and payable but nothing else.
We have now paid more than the liabilities due under the contract when it was terminated, through our monthly payments. My question is, does that now mean the debt is discharged.
I have put al these points together with a bill for the amount they owe my wife for over payment In a recorded letter to their office.
I will fill you in on their response if and when.
Simon

[Never-In-Doubt]

Re: MBNA Termination

Hi Simon

Have you actually done a formal ppi reclaim? If not why, surely it'd be best to do the reclaim first then assess the debt. However there is nothing to be discharged is there? Once you pay the arrears etc then it's simply closed/finished whatever!

if you're saying you've now paid MORE than the actually terminated amount as at 2005 then yea you have a good argument if they've been adding all sorts of interest and charges but surely the ppi reclaim is the way to go....?

[Silverback]

Re: MBNA Termination

Hello Simon!

...because basically they were entitled to terminate the agreement whenever they like.

No, they cannot do that.

They can constrain Credit, but not Terminate on a whim or a frolic.

IOW, they can stop you and/or your Mrs from being able to draw any further Credit, but the Agreement endures. That being the right to pay off any Balance at the agreed rates until the Account hits zero, at no less than the minimum Monthly payment that the Agreement requires.

To Terminate an Open-Ended Account such as a Credit Card, when that is not in any default, then they must follow the new CCA S98A. Please see:

s38 The Consumer Credit (EU Directive) Regulations 2010

That requires at least 2 Months Notice, or such longer period as the Agreement allows, before the Account can be Terminated.

There is no accelerated payment provision within CCA s98A. If there is a Debt still to pay, then they must allow you to pay that down. If doing so will take longer than two Months, then the time scale for Termination will have to be increased accordingly, in line with the time it will take to pay off the Balance, at the minimum rate you must maintain to perform your side of the Agreement.

However, in a default situation, then they must follow CCA s87/s88 and issue and properly Serve an effective s87(1) Default Notice to encourage you to remedy any default, settlement of which, will allow the Agreement to resume and payments to be re-commenced to pay down the Balance.

However, if the s87(1) Default Notice is not remedied, then upon expiry of the Statutory time allowed of 14 days from the Date of Service, they then gain the benefits of s87. Only then can they demand early payment of any sums otherwise due in the future, and they can then Terminate the Agreement.

The other Card is the same. All they can do is constrain Credit. The same issues apply.

Watch out for any Notices arriving and make sure you retain all Envelopes in which any such Notices were sent to you.

Finally, if you have a genuine dispute over issues such as PPI, dubious charges and/or inflated interest, then make sure you inform them of this ASAP.

I hope this helps.

Silverback

[simon]

Re: MBNA Termination

Hi Simon

Have you actually done a formal ppi reclaim? If not why, surely it'd be best to do the reclaim first then assess the debt. However there is nothing to be discharged is there? Once you pay the arrears etc then it's simply closed/finished whatever!

if you're saying you've now paid MORE than the actually terminated amount as at 2005 then yea you have a good argument if they've been adding all sorts of interest and charges but surely the ppi reclaim is the way to go....?

Hi
No i reclaimed the PPI back in 2006.

There was never any arrears on either account, accept for the couple of months i with held payments and they have now been made up. To date the account has no arrears or charges. Even the missed payments have dropped of the CRA.
However they have still been charging interest at the contractural rate post termination..As if the account was live.

We have been making minmum payments on this accounts and these payments have been debited from the outstanding ballance (which includes interst on a monthly bases). In my view the payments should just have been reducing the ballance(the principle) becaues there is no facility to charge interest on the account.
Simon

[simon]

Re: MBNA Termination

Hello Simon!

No, they cannot do that.

They can constrain Credit, but not Terminate on a whim or a frolic.

IOW, they can stop you and/or your Mrs from being able to draw any further Credit, but the Agreement endures. That being the right to pay off any Balance at the agreed rates until the Account hits zero, at no less than the minimum Monthly payment that the Agreement requires.

To Terminate an Open-Ended Account such as a Credit Card, when that is not in any default, then they must follow the new CCA S98A. Please see:

s38 The Consumer Credit (EU Directive) Regulations 2010

That requires at least 2 Months Notice, or such longer period as the Agreement allows, before the Account can be Terminated.

There is no accelerated payment provision within CCA s98A. If there is a Debt still to pay, then they must allow you to pay that down. If doing so will take longer than two Months, then the time scale for Termination will have to be increased accordingly, in line with the time it will take to pay off the Balance, at the minimum rate you must maintain to perform your side of the Agreement.

However, in a default situation, then they must follow CCA s87/s88 and issue and properly Serve an effective s87(1) Default Notice to encourage you to remedy any default, settlement of which, will allow the Agreement to resume and payments to be re-commenced to pay down the Balance.

However, if the s87(1) Default Notice is not remedied, then upon expiry of the Statutory time allowed of 14 days from the Date of Service, they then gain the benefits of s87. Only then can they demand early payment of any sums otherwise due in the future, and they can then Terminate the Agreement.

The other Card is the same. All they can do is constrain Credit. The same issues apply.

Watch out for any Notices arriving and make sure you retain all Envelopes in which any such Notices were sent to you.

Finally, if you have a genuine dispute over issues such as PPI, dubious charges and/or inflated interest, then make sure you inform them of this ASAP.

I hope this helps.

Silverback

HI
I dont want this to turn into a discussion on account termination.
The creditor can terminate an account(providing there is contractual clause that says they can) with two months notice as you say per the new EU regulations. Befroe Feb this year they dould do it with just 7 days notice section76. Section 98 only covers agreements with a fixed term.

They can also demand immediate payment. They cannot enforce that demand of course, because to do that they would have to issue a section 87 notice and to do that there would have to be a default however there is nothing stopping them demanding.

Simon

[Never-In-Doubt]

Re: MBNA Termination

My question is, does that now mean the debt is discharged.

I dont want this to turn into a discussion on account termination.

Simon, you asked the original question (top quote) so Silverback responded to that question, for you to then reply to your own question with another fact!

I am slightly confused why you'd ask the question if you already knew the answer, thus you'll now realise why I stayed well away from answering the termination issue as I read the 500 page bitch-fight discussion OTR

So, assuming you understand the finer points of Termination, what was your question - or don't you have one, but want to discuss termination again over here? I'm fine with that if you do, however just confused as to why you answered your own question upon another user responding....

[simon]

Re: MBNA Termination

Hi
I didnt know that i was required to ask a question. My question was a rhetorical one to the creditor. I thought that was clear obviously not. Regarding siverbacks reply, it was factually incorrect, that is not my fault.
I am mearly chronicalling an action i am taking against MBNA if people want to comment fine, if they are mistaken in there interpretation of the legislation i will comment.
I cannot really see your problem

Peter

[simon]

Re: MBNA Termination

HI Again

If i may say you seem to be adopting an adverarial tone that is completely inwarrented.
I said in my reply that i did not want this to turn into a discussion on account terminaion.
For the very reasons you stated.
Think i will be simon this time
Simon

[Never-In-Doubt]

Re: MBNA Termination

I didnt know that i was required to ask a question.

You aren't, you weren't you're not....?

My question was a rhetorical one to the creditor. I thought that was clear obviously not.

It was unclear, thank you for clarifying this though - we really appreciate it.

Regarding siverbacks reply, it was factually incorrect, that is not my fault.

Factually, in what context? Factually by your accountability or factually in law?

I am mearly chronicalling an action i am taking against MBNA if people want to comment fine

Excellent - look forward to seeing the end result... On a forum, you're likely to get comments, no?

if they are mistaken in there interpretation of the legislation i will comment.

Great, it's a forum so comments are good!

I cannot really see your problem

I don't have a problem, i'm quite laid back as it happens!

Peter

Would you like me to change your username to Peter for you?

[Never-In-Doubt]

Re: MBNA Termination

If i may say you seem to be adopting an adverarial tone that is completely inwarrented.

Simon, I am neither adverarial nor adversarial I simply replied that you asked, someone answered but you already knew the answer to the question that maybe should never have been asked; based on the fact you already knew the answer and knew that by others answering it'd allow you to bring it back into debate!

See? Simples

[simon]

Re: MBNA Termination

You aren't, you weren't you're not....?
It was unclear, thank you for clarifying this though - we really appreciate it.

Your welcome
Factually, in what context? Factually by your accountability or factually in law?

Incorrect in law Would you like me to explain?
Excellent - look forward to seeing the end result... On a forum, you're likely to get comments, no?

Good that is why i posted it
Great, it's a forum so comments are good!
I don't have a problem, i'm quite laid back as it happens!
Would you like me to change your username to Peter for you?

NO Please leave it as it is it gives me a degree of flexbility, which is always good
Pimon

[Never-In-Doubt]

Re: MBNA Termination

Pimon

[pompeyfaith]

Re: MBNA Termination

Pimon

Does that mean:

[simon]

Re: MBNA Termination

Simon, I am neither adverarial nor adversarial I simply replied that you asked, someone answered but you already knew the answer to the question that maybe should never have been asked; based on the fact you already knew the answer and knew that by others answering it'd allow you to bring it back into debate!

See? Simples

The point is i did not ask a question. (look up rhetorical in your spelling dictionarry)Never the less any comments or suggestions are welcome of course, but if i do not agree i reserve the right to say so.

ERM peter

[Never-In-Doubt]

Re: MBNA Termination

The point is i did not ask a question. (look up rhetorical in your spelling dictionarry)Never the less any comments or suggestions are welcome of course, but if i do not agree i reserve the right to say so.

ERM peter

It was never intended to be rhetorical at all though, or certainly wasn't made to be clear - that's a fact! I have no need to use a dictionary, thanks. I was blessed with a brain and rely on that most the time. If I need a dictionary then I shouldn't be answering with that word as if I do not know what it means, i'd never use it

I know you disagree with silverbacks comments, this is evident from 2 other forums no? Whats this make it a full house?

Best of luck whatever your ultimate aim is.