Bank of Ireland debt collection tactics

Mr Burns

My friend got a rather threatening letter from BOI about an outstanding debt of circa 5K. He can't pay it at the moment due to hard luck, lost job recently.
The letter said that the BOI debt collectors would be calling to his house to collect and if nessasary continue to call very frequently to ensure collection.

Surely this amounts to harrassment of a debtor. I doubt that BOI can send hired goons to stalk my friend at his house. Surely if they can't get the money the must sue him and get judgements etc.

Any advice? He doesn't need any self rightous stuff about he should pay up. If he could he would.

Thanks
Mr. C.M. Burns

Nuttzz

they will send people around to collect money, he should talk to them they will come to some arrangment with him. Its not harrassment though. does he have loan protection (i'd assume not)

Our man in Havana

Nuttzz wrote:

they will send people around to collect money, he should talk to them they will come to some arrangment with him. Its not harrassment though. does he have loan protection (i'd assume not)

I don't know about that, It is harrassment if they call at such frequency. The letter stated very frequently which i would take the meaning they would keep hassling him , but on a daily, weekly basis? If the man has no money they have no option but to see judgement or to call off the hounds.

From the wording of the letter which is on face value very threatening, i would think it is an empty threat as I don't imagine armies of hired goons stalking the land looking for debtors.

Drummer

They are within their rights to send debt colectors around until they are paid. However, 5k isnt exactly collossal - i suppose from your friends point of view - but banks have written off much bigger debts than this for people / entities who could afford it much easier. This is bad business if you ask me. I suggest that your friend approaches them, and offers to begin payments of a certain amount at some date down the line. Give them some re-assurance that he is not neglecting or ignoring them. This may help. Also, put all his proposals in writing and if they agree, get them to sign on it, even though he probably signed and agreement on a loan. Hope this helps.

threebeards

It would be wise for your friend to contact the bank and come to some arrangement with regard to making an effort to make repayments. Tell him to explain his circumstances/situation and offer to pay them €5 per week. If he doesn't face the situation head on, it could jeopardise his future borrowing ability i.e. his rating with the Irish Credit Bureau wouldn't be too favourable and this will adversely (sp) affect him in the future as most lenders consult the ICB before approving loan/mortgage applications. It would be terrible if an outstanding loan of €5K meant in the future that he couldn't get loan facilities.

Our man in Havana

Surely their is an issue of tresspassing if the person tells them to **** off and go away and not to return? . I always thought it was usual practice to go to court to get installment orders?

Nuttzz

It sounds like that he hasnt talked to the bank about his situation at all, if he talks to them, or goes to MABS then he is likely to get the hounds off his back, Ignoring them isnt going to work

BuffyBot

Keep in mind we don't know the full back-story. Banks normally only get this upset when they've in extreme circumstances. Also, we don't know how the letter was worded in actuality, so I'd be wary of jumping to conclusions.

OP: He needs to talk to the bank, and he needs to talk to them now. They could hand the amount over to a debt recovery agency if it goes on long enough - and then it does get messier.

Kappar

It would be very doubtful but they could be liable under the following depending on the cicumstances.

11.—(1) A person who makes any demand for payment of a debt
shall be guilty of an offence if—
(a) the demands by reason of their frequency are calculated to
subject the debtor or a member of the family of the
debtor to alarm, distress or humiliation, or
(b) the person falsely represents that criminal proceedings lie
for non-payment of the debt, or
(c) the person falsely represents that he or she is authorised in
some official capacity to enforce payment, or
(d) the person utters a document falsely represented to have an
official character.

- s.11 Non-Fatal Offences Against the Person Act, 1997

Our man in Havana

I would doubt that BOI would fall victim of the above, that is why I don't think they would send debt collectors around. I would think they would go to court and do things lawfully.

I do think that they should not use the term very frequently in their letters.

MrPudding

I would think it woul dbe better to try to work things out with the bank with out going to court. If they go to court it will ruin any future attempts to obtain credit.

MrP

Our man in Havana

The bank will settle for cents on the euro. They are prepared to cut their losses so long as they get something back.

Victor

It's probably a standard letter. Go to www.MABS.ie and arrange something.

gre_soul

Nuttzz wrote:

It sounds like that he hasnt talked to the bank about his situation at all, if he talks to them, or goes to MABS then he is likely to get the hounds off his back, Ignoring them isnt going to work

exactly, tell him to pay his bank manager a visit, ignoring him is a bad idea as it gives him less power and so problems arrise, tell him/her the full story and everybody is more the wiser and knows the deal.

nlgbbbblth

a letter like that is not sent out unless previous, more gentle, reminders have been ignored by the customer.

Mr Burns

Thanks for all the replies.

Update, my friend has made contact with BOI and made an offer to them. Sadly they are not interested in negoiating at all. Its all or nothing. He made a decent offer in my opinion. They now want to head to court. A fine mess.

Any advice?

whippet

I remember recently (maybe two years ago) a case with the Bank of Ireland (i believe) in ashbourne, it was reported in the meath cronicle.

The bank tried their heavy handness on someone who couldn't repay a debt of about €1500. The judge took a very dim view of the banks actions and more or less said that the banks take a risk with every debt more or less told them that bad debts are part and parcel of a banks business.

he awarded the bank an order for the customer to pay €2 or so a month.

Nuttzz

Mr Burns wrote:

Thanks for all the replies.

Update, my friend has made contact with BOI and made an offer to them. Sadly they are not interested in negoiating at all. Its all or nothing. He made a decent offer in my opinion. They now want to head to court. A fine mess.

Any advice?

go to mabs, they are much better with dealing with the bank than joe public, he must have a sh!t record though from them not wishing to talk about a deal...

Mr Burns

Nuttzz wrote:

go to mabs, they are much better with dealing with the bank than joe public, he must have a sh!t record though from them not wishing to talk about a deal...

He was talking to a insolvncy expert today. The situation is the bank would settle for €1200 approx on a debt of €5k. The thing is they would not be eager to go for a deal before the manner is dealt with by a court. Can't see the logic there.

The advice was to let them obtain judgement and then offer the deal afterwards as a take it or leave it one time offer.

Opinions please.

Thanks

RainyDay

whippet wrote:

The bank tried their heavy handness on someone who couldn't repay a debt of about €1500. The judge took a very dim view of the banks actions and more or less said that the banks take a risk with every debt more or less told them that bad debts are part and parcel of a banks business.

Wasn't it nice of the judge to ensure that the bank's good customers & shareholders (which include anyone who has a pension) are left to carry the load of the bad debtors.

antoinolachtnai

The reason they want it to go to court is so you end up in Stubb's and wreck your credit. They will settle for anything after that, but you have already lost the game at that stage.

Someone in this situation should at least go and talk to MABS.

lomb

RainyDay wrote:

Wasn't it nice of the judge to ensure that the bank's good customers & shareholders (which include anyone who has a pension) are left to carry the load of the bad debtors.

thats some crazy judge that ignores the laws. the bank has every right to persue defaulters to the limit of the law. if he owes them 5 grand and he has assets other than the shirt on his back they should be able to liquidate them and get payment. having said that they should see if something can b worked out. i dont think ur friend is being honest saying he will give them 20 cent on the euro. sounds like a right stroker. i know if i lent him money i would seek full payment as im sure he would if he lent money to me. why doesnt he agree to pay it all back, and if he cant, ask them to freeze repayments for 6 months so he can take steps to get another job or failing that liquidate assets or possibly declare bankruptcy if he hasnt got anything.

shoegirl

BuffyBot wrote:

OP: He needs to talk to the bank, and he needs to talk to them now. They could hand the amount over to a debt recovery agency if it goes on long enough - and then it does get messier.

Actually the debt collection agencies that BOI use are far easier to deal with than dealing with BOI direct. However if you have just one person to deal with in BOI, and multiple debts it might be possible to build a relationship with them and get some bit of understanding.

These letters are written to intimidate people into paying, and they do work, however they tend to ignore the fact that the guy probably has multiple debts and problems beyond one 5k debt.

What he can do:
1. Call BOI collections (I forget what they call it, something euphemistic) and explain the situation, including what he CAN do (for example pay off 100 every 2 weeks).
2. Write a reply to the letter offering to pay fixed amount regularly.
3. If this fails there are 2 options -
a) contact MABS and let them negotiate for you
b) let the debt collector come to you and again offer to make regular payments.
4. If at this point they refuse you need to go back and give them a full account of your means - again offer repayments

Its more than likely you'll never get to point 4.
If you do - all is not lost. A close family member eventually negotiated a pay off rate and worked with MABS and his credit union to arrange a loan to repay off all his debts. They eventually all agreed - and he was a pretty bad case.

I owed 10k 4 years ago, about 7.5k of it to BOI. They let me pay off my loan (I made slightly higher payments to gadualy clear arrears) - though it wasn't formally agreed by them. My credit card took about 2-3 months to get back up to date (and not only do I still have it today but bizarrely they increased my credit limit from 1900 to 3400!) My bank account suffered most: replayments to my loan and credit card had bust this before the other accounts did by making 3 months of repayments to the CC/loan which me 1000 over my agreed overdraft. Over the space of about a year they slapped on about 400 euros in interest and charges and pulled the account and sent it to a debt collector. At that point I had reduced it from -1700 to -600 euros. I called up the debt collector and they immediately agreed, no problem, to let me pay it off over 6 months.

That suited me fine, though I did lose my current account. About a year later I went to NIB and opened a freebank account. I got all the same as I had with BOI minus the overdraft and bank charges! They even gave me a new credit card with a lower interest rate than BOI and eventually a modest car loan which is almost paid off (never missed a payment :-) )

To be honest its not the end of the world, you just have to assess what you can afford to pay, negotiate and stick to it. Once that is done 5 years starts ticking by fast. Its 3 years now since most of my debts were paid so it won't be long before hopefully, I'll be "high street creditworthy" once more.

shoegirl

RainyDay wrote:

Wasn't it nice of the judge to ensure that the bank's good customers & shareholders (which include anyone who has a pension) are left to carry the load of the bad debtors.

The reason judgments like this are made is when the judge feels that the bank should have negotiated with the debtor, instead of leaving the courts and taxpayers to pick up negotiating costs.

I suppose you've never been made redundant, been unexpectedly unemployed or underemployed, or ran a business that ran into trouble. If you did you'd understand why people end up with debts they cannot pay.

Secondly, I know in my case that my banks made an extra profit of about 800-1000 euros on account of me being in debt - and they got every penny of that. On top of the very high profits Irish banks make - the highest in Europe and most of the OCED - they can well afford to be more lenient where appropriate.

Savman

in other words, www.mabs.ie

RainyDay

shoegirl wrote:

The reason judgments like this are made is when the judge feels that the bank should have negotiated with the debtor, instead of leaving the courts and taxpayers to pick up negotiating costs.

I suppose you've never been made redundant, been unexpectedly unemployed or underemployed, or ran a business that ran into trouble. If you did you'd understand why people end up with debts they cannot pay.

Secondly, I know in my case that my banks made an extra profit of about 800-1000 euros on account of me being in debt - and they got every penny of that. On top of the very high profits Irish banks make - the highest in Europe and most of the OCED - they can well afford to be more lenient where appropriate.

I've been through redundancy and I've done my time on the dole. I didn't run up debts. I adjusted my outgoings to match my incomings. The point I was making is that there is no 'magic wand' which makes debts dissappear. If the debtor doesn't pay, then the bank shareholders pay.

antoinolachtnai

Well, that'd be fine if the interest rate was euribor + .5 or something like that. But when rate is euribor + 5, 10 or even 15, then you have to admit that the bank must be expecting a certain proportion of defaults.

This is the whole premise of modern banking, and not just personal banking either. Accept some risk in return for a higher interest rate. Accept that you have to absorb some defaults and price it in.

jimmycrackcorm

RainyDay wrote:

Wasn't it nice of the judge to ensure that the bank's good customers & shareholders (which include anyone who has a pension) are left to carry the load of the bad debtors.

Surely you can't be referring to those banks that make gross and excess super-profit by screwing us customers. Recall any banking overcharge scandals in recent times?

RainyDay

antoinolachtnai wrote:

This is the whole premise of modern banking, and not just personal banking either. Accept some risk in return for a higher interest rate. Accept that you have to absorb some defaults and price it in.

So it is priced in for the other customers to pick up the bill for the defaulters - right? Why should I pay for someone else's lack of financial discipline?