Nature of HSBC's 'Ending' of a former-Midland CC account...

[creditcruncha]

IF HSBC writes to end all further use of its credit card (originally associated with Midland bank), but has not declared default or specified any fault, and says: "I am writing to inform you that we are ending your credit agreement" and "you can no longer use your card";

 

BUT then in the same letter also says: "Payments must be made in accordance with the terms of the credit card agreement, so please ensure that future payments are credited to your account by the due date...."

 

THEN

 

a) As they declared an end to the credit agreement, can they at the same time insist that payments be continued according to a supposed agreement which they themselves have ended?

 

OR

 

b) Even if they wish to collect the outstanding amount/balance/debt, can they now insist on continuing the repayment terms an agreement which they are explicitly ending?

 

AND

 

c) Is it not unfair/unabalanced that while HSBC won't provide service as per the supposed agreement, they assert the account-holder must continue being bound by the terms of the agreement?

[Guest Old_andrew2018]

Bump

[creditcruncha]

Nobody has any insight on this?

Please, anyone?

[johnnymitch]

Hi creditcruncha

 

Why don't you write and put it to them as above .... see what they come back with ?

 

and let us know .... it could be interesting ....... lol !

[creditcruncha]

Johnny, thanks for your response but are you serious that it should be put to them in a query? Your lol is a bit disconcerting and unclear...

[johnnymitch]

Hi creditcruncha

I was absolutely serious about asking them to explain the logic and rules governing this .... they're not allowed to tell you blatant lies , so what I meant was it would be interesting to see what reply you get (if any) .

 

The 'lol' was at the thought of how they would be scrambling around for a reply ............

[creditcruncha]

Thanks for clarifying that, johnny! I am going to write them and will keep you informed.

[rdm2006]

While you are at it send them £1 asking for a True copy of the agreement under the CCA act. and £10.00 subject access request. request all info they hold regarding YOU not just this account. stipulate in particular a True copy of the Agreement dont return the card cut up if asked. Just cut it up, bin it, and confirm to them that this has been done.

 

Then read up on the debt collection industry forum.

 

I had a card for £5,000, did the above, it went to dca's etc I told them no CCA - No Pay they filed at court paid the £125 when it came closer to the date, the court wrote to them asking them to pay a further £300 for the hearing they never did and i have not heard a thing since.

 

Please note I do not Advocate avoiding debt. I did this as they had (by their actions not literally) robbed me of an amount of money (not charges either) if they had not I would have paid regardless.

 

Nor am i saying that two wrongs make a right - they do not - I am just saying I evened things up a little.

 

It was all perfectly legal!!!

Edited March 13, 2010 by rdm2006

[creditcruncha]

Hi creditcruncha

I was absolutely serious about asking them to explain the logic and rules governing this .... they're not allowed to tell you blatant lies , so what I meant was it would be interesting to see what reply you get (if any) .

 

The 'lol' was at the thought of how they would be scrambling around for a reply ............

 

So a (late) reply from them has now been provided. They actually admit the wording can be confusing (but there is no indication they will endeavour to make it more clear for others in future). They contend the wording is intended to explain that while they are ending use of the card, "the card should continue to be ran" [err, more confusing language? ] according to its "agreed" T&C's until the balance is paid.

 

So, [notwithstanding any dispute regarding 'agreement' of T&C's], they seem to now express their view that repayments and ostensibly also interest charges "should" - but they don't say necessarily must - go on in the same way as before.

 

Do you consider that this leaves room for moi to respectfully disagree on the basis that if they specifically stated they are ending the agreement, then future conduct of the account (ie, repayments, interest, etc) is subject to a new arrangement to be agreed as the original agreement has ended by them and one cannot have it both ways? And that their confusing language contributes to an unfair relationship?

Edited April 21, 2010 by creditcruncha

[Castlebest]

Hiya again CC if this is relation to the credit agreement that they have failed to supply you with I certainly think it adds to your argument that the account is now uninforceable and puts you in a much stronger position to negotiate a much reduced repayment plan .

 

One thing I will add, if your aiming for a one off settlement figure the indications are that the banks sell on debts to DCA's for around 30% of their face value so maybe a one off payment offer of 25 to 30% of the debt value would be a good place to start.

 

pete

[creditcruncha]

Pete, thanks for your thoughts!

While an account is in disupte and being declared unenforceable, until a one off final settlement figure is negotiated, should the account holder continue paying the full minimum payment, pay a nominal payment, or pay nothing in the interim?

[banker_rhymes_with]

Hello CC!

 

"I am writing to inform you that we are ending your credit agreement" and "you can no longer use your card"

They are saying three things there, and the wording seems clear enough:

 

(1) "We are ending your Credit Agreement" = Termination.

 

(2) "You can no longer use your Card" = that's to be expected if they have Terminated.

 

(3) "Payments must be made in accordance with the terms of the credit card agreement, so please ensure that future payments are credited to your account by the due date...." = this makes no sense if they have Terminated!

 

The problem for them is (1), it clearly says Agreement, and they are ending it. (2) then confirms you won't be able to use your Card, and yet (3) makes no sense because there is no Agreement to pay if they have elected to bang out of it without the lawful entitlement to do so.

 

I suspect that their letter could well be used to argue that they have Terminated unilaterally, and unlawfully. But I can't see what they actually said in full, so all I can do is suspect.

 

I think what these muppets were trying to do, but failed in the attempt, was to inform you that your facility was being restricted, which they are entitled to do, in which case the Agreement endures, you have to pay off the Balance at the applicable rate (as agreed in the Prescribed Terms and as varied if they are allowed to vary), but you are protected by the Act to ensure you are allowed to do so for as long as it takes to clear down the Balance via your minimum payment (or above the minimum, but only as you see fit). But they can remove or restrict the facility to borrow more, so it becomes a stale Agreement for you, one you can only pay down until the Balance is zero.

 

But Terminating the actual Agreement, presents a problem for them, because they have no right to do so in non-default cases, i.e. whilst there is a balance to pay off. Or, put another way, they can do it, but there's nothing in the Act that entitles them to Terminate (in non-default cases), and certainly nothing that would support early payment (in non-default cases) or even continued payment after the Agreement has ended (in non-default cases).

 

On the other hand, if you have done wrong, then they always have s87/s88 to wrap things up via a s87(1) Default Notice that, if you fail to remedy that, would entitle them to s87 benefits, including the right to Terminate, and the right to demand early payment.

 

But if there is no default, and they do not have s87 benefits, then they could well have shot themselves in the foot if that letter can be regarded as Termination.

 

As others have said, hit them with all of the usual Statutory Requests, such as s78(1) and a SAR, £1 and £10 respectively, sent to them via Special Delivery to confirm when they received these Requests.

 

I'm glad you mentioned Unfair Relationship, because that would be the next issue to investigate. Whilst they can do many things, it still has to pass the basic test of fairness, so have a good look at the motive behind restricting your Credit, assuming that was their real intention, and see if they increased, say, your interest rate ahead of doing this, something nasty like that.

 

IOW, they knew they were intending to take your ability to borrow further sums away, and yet would want you to keep paying down the existing Balance. But did they elect to boost their return ahead of this, for no valid reason. That's the sort of issue that might well be regarded as Unfair.

 

For now, it may be an idea to say you accept their Repudiatory Breach, and accept their Unlawful Termination. But say little else. After all, if they can Terminate and say it was all a terrible mistake, then you can always say that your acceptance was also a mistake too, so there's no harm sending this.

 

However, if you do accept their Termination, then it goes on record that you have accepted their Termination, and you can use that later, if needed, depending what else you find out via s78(1) and S-A-R Requests.

 

In summary, these beggars have made what looks to be a big mistake, and are now back pedalling like mad to try and extricate themselves from it...except even their attempts to do so are cack-handed, condescending and even more confusing (from what you say).

 

HTH

 

Cheers,

BRW

Edited April 22, 2010 by banker_rhymes_with
Clarity

[creditcruncha]

Thanks, banker rhymes!

Edited May 3, 2010 by creditcruncha