Statue Barred debt

Squiggle

From Citizens Information :

"The law in relation to time limits is complex but, in general, the time limit for taking actions for breach of contract (for example, failure to pay for goods or services provided), for debt judgments and for non-payment of charges such as rent is 6 years. This means that if your creditor does not start the court action within 6 years of the debt being due, the action is statute-barred. Effectively, that means that you cannot be forced to pay the debt. "

What is meant by the "debt becoming due" ie when does the 6 year clock begin ticking - last payment, last correspondence or something else? TIA

Claw Hammer

Squiggle wrote: »

From Citizens Information :

"The law in relation to time limits is complex but, in general, the time limit for taking actions for breach of contract (for example, failure to pay for goods or services provided), for debt judgments and for non-payment of charges such as rent is 6 years. This means that if your creditor does not start the court action within 6 years of the debt being due, the action is statute-barred. Effectively, that means that you cannot be forced to pay the debt. "

What is meant by the "debt becoming due" ie when does the 6 year clock begin ticking - last payment, last correspondence or something else? TIA

From the time that it becomes enforceable. Remember though that part payment for written acknowledgement of the debt starts the clock running again. If you are due to make a payment at the end of this month and fail to pay it the creditor has six years from the end of this month to start an action.

GerardKeating

Claw Hammer wrote: »

From the time that it becomes enforceable. Remember though that part payment for written acknowledgement of the debt starts the clock running again. If you are due to make a payment at the end of this month and fail to pay it the creditor has six years from the end of this month to start an action.

So (for example) If I borrowed money in 2010, and promised to pay it back in 2014, the debt did not come due till 2014, so they have till 2020 to take legal proceedings?

Claw Hammer

GerardKeating wrote: »

So (for example) If I borrowed money in 2010, and promised to pay it back in 2014, the debt did not come due till 2014, so that have till 2020 to take legal proceedings?

Yes. You could not have been sold until 2014 when you breached the contract.

Under His Eye

If you acknowledge the debt after the 6 years, you will start the clock again.

sexmag

Under His Eye wrote: »

If you acknowledge the debt after the 6 years, you will start the clock again.

So you pretty much have to go around with your hand over your eyes

Under His Eye

No, not really. You can simply ignore it. It is only if you acknowledge in writing or make a payment does it become enforceable again.

If anyone starts proceedings you have the statutory defence under The Limitations Act 1957.

Squiggle

Would accepting a cheque for an overcharge on a term loan account start the clock ticking again?

Under His Eye

Depends on the wording tbh.

Boogeyman123

If you have a statute barred debt does this stay on your credit report forever or is there a time limit on that also?

ELM327

ICB report goes back 5 years, statute barred debt is by requirement a minimum of 6 years. Therefore there will be no overlap.

Boogeyman123

ELM327 wrote: »

ICB report goes back 5 years, statute barred debt is by requirement a minimum of 6 years. Therefore there will be no overlap.

I have a loan that is showing on my report that I believe to be statute barred. On the website it says 5 years from when the loan is paid off is when it is removed from the report. I am just confused as to what happens in the instance of a statute barred loan.

4ensic15

Boogeyman123 wrote: »

I have a loan that is showing on my report that I believe to be statute barred. On the website it says 5 years from when the loan is paid off is when it is removed from the report. I am just confused as to what happens in the instance of a statute barred loan.

The money is still owed in a statute barred loan. All statute barring means that it can be raised as a defence to an action for the sums outstanding. A loan is not extinguished on passing the limitation period.

Johnny Red Cab

The money is still owed but is legally unrecoverable.

4ensic15

Johnny Red Cab wrote: »

The money is still owed but is legally unrecoverable.

It is not legally unrecoverable. An action can be started but the defendant can raise the statute as a defence. If the defendant does not plead the statute, judgement can be obtained.

Credit Checker Moose

I wonder how often that happens?

4ensic15

Credit Checker Moose wrote: »

I wonder how often that happens?

Who knows.

lfen

Hi

Just adding to question above. So if a debt is statue barred, can it still appear on your ICB report?

Thanks

Credit Checker Moose

Yes.

Avatar MIA

lfen wrote: »

Hi

Just adding to question above. So if a debt is statue barred, can it still appear on your ICB report?

Thanks

For a debt to be on an ICB report the lender needs to be a member of the ICB i.e. Big enough. Their IT systems are unlikely to allow a debt to become statute barred, unless a small amount. If a small amount just pay it.

Credit Checker Moose

Some banks have allowed debts to get statute barred, often due to having bad contact info for the debtor.

I see it all the time.

Avatar MIA

Credit Checker Moose wrote: »

Some banks have allowed debts to get statute barred, often due to having bad contact info for the debtor.

I see it all the time.

Debts where the value was materially greater than the required legal costs?

4ensic15

The banks' IT systems are not particularly good. BOI announced a major investment a few weeks ago. Ulster has hand constant It trouble. The banks shed their staff before they had good enough IT in place.

Credit Checker Moose

Avatar MIA wrote: »

Debts where the value was materially greater than the required legal costs?

Not particularly.

I saw one for over 10K let go barred because they couldn't serve the debtor. Debtor had gone abroad.

4ensic15

Credit Checker Moose wrote: »

Not particularly.

I saw one for over 10K let go barred because they couldn't serve the debtor. Debtor had gone abroad.

It wouldn't be statute barred if they couldn't serve the debtor. They could have got an order for substituted service and got an undefended judgement.

Credit Checker Moose

They knew he had gone abroad. A judgement against someone who has gone beyond the EU would be pointless and a waste of money.

Looking for sub service where they know the debtor is beyond the jurisdiction of the court would involve telling porkies to a judge.

lfen

Thanks a mill. Might just share the background here also to get some advice.

I’m in an unusual situation in that I took out a mortgage at the age of 19 and on a salary of 21k. Joint account holder (ex-partner) was on about 25k. Loan amount was approx. 320k.
The joint account holder upped and left for Australia about a year later and I was left with a loan I couldn’t afford to pay and I also couldn’t sell as he wouldn’t give permission. The bank actually told me I was best to not engage with them as they would then be forced to repossess. I stupidly took that advice. I believe the house was then repossessed (I didn’t turn up to court) but I did see that it was sold for about 120k. Anyway.... Now left with a debt of over 200k and wondered if it will follow me around until I kick the bucket?

I requested my ICB report a year ago and it showed payments being made on the mortgage and it was neither me making those payments or my ex. I thought that the bank might have done it to keep pushing out the last payment date i.e. the date it becomes statue barred.

I’ve tried getting advice from two different solicitors but only advice I’ve gotten is to keep my head down. Ultimately, I would like to be able to fix my credit rating so that advice isn’t very helpful.

If anyone had advice for me it would be great? I understand I am an idiot for number 1 buying a house that I couldn’t afford at 19 and also for taking the banks advice to not engage but feel free not to judge!

Avatar MIA

You're entitled to get full disclosure of all information on your account. The bank paying money into your account wouldn't qualify for keeping the debt alive.

Have you asked the bank for a copy of all information pertaining to your account. But, by doing this you'd be acknowledging the debt.

Credit Checker Moose

A carefully worded request for information is not an acknowledgement of a debt.

Avatar MIA

Credit Checker Moose wrote: »

A carefully worded request for information is not an acknowledgement of a debt.

If you could offer the wording it might help.

lfen

I haven’t no as I’m worried it will restart the clock. The last payment was made in April 2010 and last contact was May 2012 so really it should now be statue barred. On my ICB report it says -

Scheduled removal date: To be determined

And interest is still accruing. I can’t find any records showing that the house was actually repossessed either but I assume it was if it was sold.

Such a mess and it seems there is no way out of it.

Credit Checker Moose

The only way out is to go to an insolvency practitioner and discuss your options.

Other than that, keeping the head down is sound advice.

lfen

I’ll give that a try so. Thanks again, really appreciate it.