Unenforceable Loans under the Consumer Credit Act 1974
Loans that do not comply with the Consumer Credit Act 1974 may be unenforceable which means that you are not liable to pay the loan back. If the loan is not compliant then the bank is unable to profit from the loan and as a result has to write off the loan. You may even receive mis-sold PPI insurance back from the lender if this was applied unlawfully.
Loans included in this category include secured loans, unsecured loans, car loans, hire purchase agreements and second mortgages under £25,000.
The general areas of Law that make a loan unenforceable include the following:
- Non provision of prescribed terms - your lender has not provided you with all the information they were required to provide you with under the terms of The Consumer Credit Act 1974 and the Banking Code
- Inappropriate Execution of Agreement - Your Lender did not include in your loan agreement the content to allow correct execution of the agreement as defined by the Consumer Credit Act 1974
- Miscalculation of Annual Percentage Rates (APR's) - Your lender did not use the specific method or failed to include certain costs when calculating your loans APR as required by the Consumer Credit Act 1974 and the Banking Code
- Non Disclosure of commissions and fees - Your lender did not disclose to you all of the commissions and fees they paid or received in connection with your loan as they are required under the Consumer Credit Act 2006 and the Financial Services and Markets Act 2000.
- Mis-selling of Ancillary Products - Your lender included an ancillary product such as Indemnity or insurance with your loan and did not follow the requirement s of the Financial Services and Markets Act.
In order to commence this process the requirement will be for you to send your claim to us for us to review. Once it has been reviewed by our solicitors, we will then know the situation and whether it is possible to write off the loan due to the agreements non compliance to the relevant regulations.
Should you have any questions or queries or would just like to speak to someone about the process then please go to our Contact Us page.
