Debt repayments refused

Capital One Bank. Anyone heard of them? Of course you have, many of you will no doubt have had dealings with them too.

Well about 3 years ago, maybe a little less, I applied for a credit card from them. I got it and all was fine while I was spending on it, of course.

At the time I was working & earning reasonable wages, so I decided to take out a payment protection insurance so that in the event of my becoming ill & being off work, or should I happen to lose my job I would be covered. That was what i was told anyway.

A couple of years later I did have to leave work due to a back problem. The problem was quite bad, but despite that I tried to keep working. While I could not do the job I was doing when I took the credit card I took another job that I thought would be less strain on the back. This turned out not to be the case, but at least I tried.

So anyway, I got a bit behind with payments and Capital One reminded me that I had the insurance and suggested that I get in touch with Axa to make a claim. Well, what they actually said was “To see if I was eligible to make a claim”. This was the first warning to me that something was not entirely as it should be. I was told nothing of the possibility that I might not be eligible to make a claim when they sold me the insurance. So I got in touch with Axa and had to go through a whole series of forms that had to be filled in by my doctor & I had to send them wage slips  & such. This went on for a month or more and it turns out that because I was not actually registered as unfit for work by my doctor for a certain amount of time continuously (my own fault for taking another job I guess), I was not eligible so they closed the claim.

This means that although I had been paying £5 a month for a few years into the insurance plan, I could not claim it back now that I needed it. So my first thought (well my first thought was actually ‘what a rip-off’) was that they could take all the £5 I had paid over that time and take that off my balance. No such luck. Capital One said I needed to take that up with Axa and Axa said I needed to take it up with Capital One. See where this is going right?

Capital One phoned me up almost every day telling me that I needed to pay the balance or I would get more charges. Being unemployed I could not pay the balance and I told them so. The charges kept going on and eventually the charges put me over my agreed credit limit. So I get charged for that too. Let’s remember here that I did not spend over my limit, it was their charges that put me over. No amount of explaining on the phone would make a difference. Aside from the fact that they mostly couldn’t speak very good English, they have to stick to this rehearsed speech that they are obviously taught & told to stick to.

Eventually they get the message that I am unemployed and cannot afford to pay the amount and they tell me that it will be passed to a collection agency. Well i thought that’s OK, I will make them an offer of what I can reasonably afford to pay and at least the interest & charges will stop. When I spoke to the collection agency they tell me that Capital One wants the entire amount in one go. Ha. Funny. I explain to them that I am unemployed and that it is impossible for me to pay that. I also explain that if I could afford to do that I wouldn’t have been passed to the agency in the first place as I would have been able to pay Capital One. This makes no difference of course. They tell me that Capital One wants at least 5% of the total balance per month as a minimum payment. This would be around £45 a month. I told them I could not possibly afford that on unemployment benefit and made them an offer of £25 a month. The told me they cannot accept this and they would have to hand the whole deal back to Capital One to take whatever course of action they decide.

S now I am waiting to hear from Capital One again to see what they have decided. I have never heard of a collection agency refusing to accept a reasonable payment. I believe £25 a month to be a reasonable payment from someone who is unemployed. I would still like to know what happens to all the £5 I paid every month into the insurance plan. Do they just get to keep that?  Is that legal? probably.

Time & time again I see examples like this and then I hear & read that the best course of action when you are in debt & can’t afford to pay is to get in touch with the people you owe and explain your situation(which I have), offer to make a payment that you can realistically afford to stick to (which I have) and that they would rather sort this out with you than go through legal proceedings. This just does not seem to be the case.

I will update this when I have more to say.