Tips and process for using the CCA to your advantage
If you re considering challenging your debts using the Consumer Credit Act to your advantage, see the tips below.
- Asses your debts. Read up on the subject and find out whether your accounts and circumstances would make this a viable option. Take a look at the alternatives as well.
- Remember it is your lawful right to send a request for information (CCA request) even if your account is still live and you are making payments.
- If you think some accounts may be unenforceable, you don’t need to stop making payments at this stage if you don’t feel comfortable. If you are not making payments, you have nothing to be concerned about.
- Wait for the creditor’s response, bearing in mind most won’t respond within the timescale. Failure to respond to a ss.77-79 CCA request makes the account temporarily unenforceable, until such time they respond. They will not be able to obtain judgment in court you while you have an outstanding CCA request.
- Once the 12 + 2 working days are up, they are in default of your request. If you are not making payments and they are not chasing you, there’s no need to remind them. You may want to remind them if you need to assess your position, for example, to determine whether the agreement has an unfair term or is irredeemably unenforceable due to lack of one or more prescribed terms.
- If they demand payment or threaten legal action, you should respond referring them to your unsatisfied request.
- Once you get a response, you need to asses the documents on their own merits to see if they comply with the requirements set out by the Act.
- It is important to keep hold of all the paperwork sent and received so you can build a good paper trail and can refer to previous correspondence.
- Keep the communication lines open with your creditors. You will receive several letters, most of which will not address your concerns. In that case, just referring them to your previous correspondence will suffice.
- Keep it all in writing, do not discuss the account over the phone at any time. If they ring you, refuse to go through security and hang up.
- If you have just stopped making contractual payments, you will be defaulted. The creditor should issue a default notice warning you that a default will be recorded on your credit file unless you remedy the breach and pay the arrears by a certain date. Default notices can be very important and you should file them safely along with the envelope they came in. See default notices for more information. Bear in mind most creditors do not retain copies of default notices issued so if you don’t keep your own you will not be able to obtain a copy.
- At some point, your account is likely to be assigned to a debt collector. Banks have their own in-house collections departments named differently so as to make you think the debt has been passed on to an external agent. If they fail to collect, they will pass it on to an external DCA. DCAs don’t get any of the paperwork or account history so it’s up to you to inform them that you are disputing the account. See DCAs for reference.
- Once the account has been through a few DCAs, it is likely to be sold (assigned in absolute) to a debt purchaser. Debts are sold in bulk without any details so, once more, it’s up to you to inform them of the fact the account is unenforceable. See above.
- If you think one or more of your accounts could be unenforceable, you will need to stop payments for at least 6 years (5 in Scotland) to allow the debt to go Statute Barred, at which point it cannot be collected through the courts.