Lending Stream and Sunny Problems

[SaltnVinegar]

Re: Lending Stream and Sunny Problems

The FCA may consider an 'Unsatisfactory business practice or procedure' where a firm:

Section 4.31
Accepts an application for credit under circumstances in which it is known, or reasonably ought to be suspected, that the borrower has not been truthful in completing the application for credit with regards to the information supplied relevant to inform an assessment of affordability

In other words, did LS or Sunny accept your application, knowing, or suspecting, you had not been truthful in completing the application. If they had, then they may be considered to be operating unsatisfactory business practices, but you would have to tell them this which could lead to a counterclaim of fraud.

You could argue that your were vunerable, and your mental health was not sufficient to make an informed decision due to your alcohol addiction, but this would depend on a couple of things:

1) The goodwill of the creditor to write off your loan
2) If a court claim were issued, then a judge would make that decision

And this is why I asked for all that information upfront at the beginning of the thread, because when you look at things you owe about £560 to Sunny and £300 to LS and I think you should consider the risk ratio. Although its unlikely to go to court, if a claim was issued against you (or fraud proceedings brought against you), the costs would be very likely be a hell of a lot more than what you owe.

Whereas if you just argue financial hardship, you avoid all that, and the loans at most will double, due to the FCA legislation brought in Jan 2nd this year. Thats it, that the risk, with a miniscule possibility of a claim being made against you for the balance (at which point you'd make a payment proposal anyway).

My thoughts for you are do you really want this fight with everything else thats going on in your life?

If so then I can help you put together a letter arguing irresponisble lending, but I want you to do so with your eyes open on your chances of success

[thaiguru76]

Re: Lending Stream and Sunny Problems

Ok. Thanks SnV

Look forward to your next post

[SaltnVinegar]

Re: Lending Stream and Sunny Problems

Hi Thai

Ok, well before we go sending off letters I think it would be beneficial for you to understand some of the legislation that you'll be arguing. Section 55B of the Consumer Credit Act states this about assessment of creditworthiness:

(1)Before making a regulated consumer credit agreement, other than an excluded agreement, the creditor must undertake an assessment of the creditworthiness of the debtor.

(3)A creditworthiness assessment must be based on sufficient information obtained from—

(a)the debtor, where appropriate, and

(b)a credit reference agency, where necessary.

Thats it, thats all it says. Now the FCA have expanded on that a bit in section 5 of the CONC guidelines as follows:

5.2.2 (1)
Before entering into a regulated credit agreement which is excluded from CONC 5.2.1 R (see (4), (5) and (6)), a firm must carry out an assessment of the potential for the commitments under the agreement to adversely impact the customers financial situation, taking into account the information of which the firm is aware at the time the agreement is to be made.

5.2.2 (3)
A firm must consider sufficient information to enable it to make a reasonable creditworthiness assessment or a reasonable assessment required by (1)

So the challenge you must present LS and Sunny is whether they considered sufficient information to enable them to make a reasonable creditworthiness assessment. To make matters more complicated, the extent and scope of the creditworthiness assessment required is dependent and proportionate to things such as the type of credit, amount of credit, cost of credit, customers credit history, customers existing financial commitments etc.

FCA CONC 5.2.4 (3) describes the sources of information that can be used in a creditworthiness assessment, those being (but not limited to):

(a) records of previous dealings
(b) evidence of income
(c) evidence of expenditure
(d) a credit score
(e) a credit reference agency report
(f) information provided by the customer

The FCA make it very clear that the above is NOT a checklist of sources of information that creditors MUST use, but types that may be appropriate, and that creditors can apply their own discretion in deciding the types and sources of information that they may use.

So in your circumstance lets consider what information they may have used:

(a) records of previous dealings - you had 5 previous loans with Sunny and 1 with LS which had been paid off, so you had a good payment history with them
(b) evidence of income - you were self employed so the only way you could have provided this is via bank statements which is your argument
(c) evidence of expenditure - as above
(d) a credit score - I know that Sunny and LS certainly since Jan 2015 use CRA's and will provide transaction numbers/id's to prove it
(e) a credit reference agency report - as above
(f) information provided by the customer - the information you provided on the application form (which the FOS consider sufficient to make an assessment of affordability)

So I want you to be aware that although you can state that they did not ask for bank statements they will argue that they had sufficient information to make a creditworthiness assessment based on the above information.

I'm not being negative here, just want you to understand the position you are trying to argue, which is failure to ask for a bank statement, is not cause for irresponisble lending on its own (although it can be with consideration of other factors).

So with that said, I'm going to write another post to discuss the other angle of your particular set of circumstances.......

[Never-In-Doubt]

Re: Lending Stream and Sunny Problems

I have also had advice from Consumer Action Group and they differ from what you have said. They say I should be honest with them and I should push to have my loans written off because neither Sunny or Lending Stream made any attempt to get proof of my income via bank statements, etc.

I would hope they have not provided advice - that is quite unlawful. However if you mean they have said do something different then do it if you want to - of course it's the mighty CAG that only lose 90% of cases (which we rescue and try to resolve) - I am unsure whether I am insulted at your ignorance or at their stupidity - however that is for the beholder to decide but one last point - see this thread - CAG *helped* someone pay £15,000 which he shouldn't have done, and now we're trying to fix the damage they caused. Find any cases like that about AAD and I'll give you £15,000!

Nuff said. Not that we're measuring dick sizes but seriously, I have never heard of anyone actually listening to CAG over us at AAD

This leaves me in a bit of quandary and I'm not sure which way to go at the moment.

Then we'll leave you to decide. Good luck whatever option you choose.

[thaiguru76]

Re: Lending Stream and Sunny Problems

Unbelievable

Lending Stream have offered me another £600 loan. Of course I have not taken it, but that is just ridiculous.

[thaiguru76]

Re: Lending Stream and Sunny Problems

Thanks again SnV

I am thinking option 2 is the best idea, but I am still going to think for a while.

If I was to go with option 2, do you have a draft letter/email that I could send as I am really not sure how to word it without giving them cause to look into my employment status.

Thanks again

[SaltnVinegar]

Re: Lending Stream and Sunny Problems

I have also had advice from Consumer Action Group and they differ from what you have said. They say I should be honest with them and I should push to have my loans written off because neither Sunny or Lending Stream made any attempt to get proof of my income via bank statements, etc.

I won't make any comment or get drawn into a debate on the advice made over on CAG, but ask yourself this:

How is option 2) above any different to what CAG are suggesting other than the fact that by 'being honest' you are opening yourself up to accusations of fraud. Did the people offering that advice, further suggest what your approach would be should your creditors realize this, and make a claim against you, or even contact the police to report a possible criminal offense?

I would strongly urge you to think through very carefully the possible repurcussions, and whether the advice offered to you also informed you of the potential pros & cons.

[cymruambyth]

Re: Lending Stream and Sunny Problems

I don't blame you looking around. AlI can say is that snv has a proven success rate in dealing with PDLS and he has given you a list of options as it is your life and your decision. Do not be swayed by some activists - AAD has had an excellent success rate and has had to deal with the consequence of 'guidance' given on other sites.

[thaiguru76]

Re: Lending Stream and Sunny Problems

Thanks SnV

I am going to have to think about this a bit.

I have also had advice from Consumer Action Group and they differ from what you have said. They say I should be honest with them and I should push to have my loans written off because neither Sunny or Lending Stream made any attempt to get proof of my income via bank statements, etc.

This leaves me in a bit of quandary and I'm not sure which way to go at the moment.

I appreciate everything you have done for me and I will update you once I have made a decision and also update you with any outcome.

Thanks again.

[SaltnVinegar]

Re: Lending Stream and Sunny Problems

Hi Thai

Your loans were taken out after Jan 2nd this year. The good news, is that it means you have a bit more protection as a consumer (for example, your balances cannot increase by more than double). However, most PDL companies that stayed in business have tended to get their house in order, and looking at the info you've provided I'm afraid this is the case on the following:

1) You've been provided with pre-contract information so they will argue that you knew what you were signing up to
2) The interest rates and charges are in line with short term, high cost loan legislation so you cannot argue UE
3) The credit agreements are in line with short term, high cost loan legislation so you cannot argue UE

On the 'irresponsible lending' front you may have an argument that they have been irresponsible offering you 3 loans in a short space of time - however the test is affordability. As you stated that you were self employed earning £1900, the affordability test could work against you.

I know for a fact that Lending Stream will not agree that offering you 3 loans was irresponsible. The FOS will also side with them on this based on the affordability test. The only way this ever really be determined is in the Courts but the two claims I've seen in 5 years were not multiple loans......

You may have an argument that they did not perform due diligence by asking for proof of income, or perform other checks, however there then is the other issue that you may not have been completely transparent in the application process, which leaves you open to claims of fraud.

As far as your alcohol addiction is concerned, this does bring into question the PDL's responsibilities under the lending code, and dealing with vunerable people (alcohol addiction is actually described as an example of a consumer who could be considered vunerable).

However, the test again, is whether the companies concerned had been aware of the fact you were vunerable, and how they could have been aware of this, which they will of course argue.

So with all that said where does this leave you?!

The way I see it is you have the following choices:

1) Take a personal view that they should not have lent you the money, that you have bigger things in your life right now to sort out, and ignore them and not pay them a further penny

Risk to the above approach, is that they will report defaults to the credit reference agencies, which may prevent you getting credit for a while, and they may (although tiny chance), issue a court claim against you (though they may not like a Judge taking a view of whether allowing someone to take 3 loans is responsible as this could be VERY bad for their business model). Youl will also get bombarded initially with phone calls and letters from their collections departments, and possibly collection agencies if they sell the accounts on.

Benefit to this is you know the balances at worst can only double. It can give you some breathing space when you get back on your feet, both personally and financially. You can then either continue to ignore them until the debts become statute barred (if they don't issue a court claim), or you can then offer a F&F payment to write off the debt, or still offer a payment proposal if you wish

2) Write to them arguing irresponsible lending and asking for the loans to be written off

Risks are the same as option 1), however you are establishing a cause of complaint, and offering a reason for non payment. Benefits are also the same as 1) with the added benefit that if they do not respond in the prescribed timeframes for a complaint you can drag things out even further. It may also give them pause from issuing a speculative court claim. You may also get one or two of the loans written off as a goodwill gesture

3) Write to them offering a payment arrangement

Believe it or not the risks are still the same as option 1). You can be in a payment arrangement, and still have a court claim issued against you! Its less likely, but it still may happen.

Benefits are, you are paying off the balances, and you are in control. It also gives you more leverage, as if they refuse your offer unreasonably, they are in breach of FCA guidelines.

However I would NOT respond to anything asking for proof of income, when you were made redundant, starting jobseekers allowance etc. This would open up a can of worms for you, and a creditor has no legal right to ask for this information anyway.

Ultimately its your choice what you would like to do, but hopefully the above helps you make that choice a little better informed. Whatever you choose we'll be able to give you guidance on how to approach them.

Best
SnV

[thaiguru76]

Re: Lending Stream and Sunny Problems

Hi

Any news?

I really want to get this sorted out so that I don't have to worry anymore. Obviously I would prefer to get them to write off the loans due to irresponsible lending, but I would be happy with a repayment plan just so that I can forget about it.

Thanks again

[thaiguru76]

Re: Lending Stream and Sunny Problems

Hi

For some reason damn Gmail decided to put AAD replies into Spam even though they were fine before. So only just saw this message.

I had already sorted out the CPA, so there is no worry on that front.

Sunny have froze account and given me 30 days to call them (that was over a week ago) and Lending Stream have given me til 19th November but they are still adding interest unlike Sunny.

Thanks again

[SaltnVinegar]

Re: Lending Stream and Sunny Problems

Hiya

Ok, lets get us some time to look at this. Have you cancelled the Continuous Payment Authority with both companies? If not then get the following email off to them immediately:

<Start Template Letter>

Dear Sir/Madam

Account No:

I am writing to advise that with immediate effect, I withdraw my authority for all future payments to be debited from card number in respect of the above loan. This is in accordance with my rights under the Payment Services Regulations 2009, which state:

“The payer may withdraw its consent to a payment transaction at any time before the point at which the payment order can no longer be revoked under regulation 67.”

Please confirm in writing that this instruction has been received and actioned.

I look forward to hearing from you.

Yours faithfully

[thaiguru76]

Re: Lending Stream and Sunny Problems

Thanks SnV

I understand this is an unusual situation. I really appreciate all your help on this.

[thaiguru76]

Re: Lending Stream and Sunny Problems

Thanks SnV

I understand it's an unusual situation and nobody but myself to blame.

Thanks again for all your doing for me. I really appreciate it.