RATIOMONEY - claiming justice for consumers

People taking action against banks and other lenders do not need to fear ‘black marks’ on their credit rating providing that they maintain regular payments until the debt has been successfully written off or legal proceedings concluded.

That’s the advice from Altrincham-based Ratio Money, a leading claims management company, which says a High Court ruling allowing banks to refer customers to credit referencing agencies only applies if people stop paying while disputing credit agreements.

Mr Justice Flaux agreed that Royal Bank of Scotland was entitled to refer customer Philip McGuffick to credit referencing agencies when he stopped payments while seeking a copy of his credit agreement.

But Ratio Money says the judgement does not remove consumers’ legal right to take action against banks and that no ruling has been made in relation to a claimant’s credit rating when the agreement is ruled unfair or irredeemably unenforceable.

“Many millions of people are yet to awake to the harsh reality that they have been duped into a lifetime of debt,” said Ratio Money’s managing director, Matthew Porteus.

“In many cases, if the minimum repayments are made then the credit card is mathematically impossible to ever pay back.

“However, many of these debts could be unenforceable if the credit agreement doesn’t comply with the Consumer Credit Act. Consumers have every right under law to request a copy of the original credit agreement which they have entered into.

“It’s imperative that payments are maintained, even when a creditor has not provided a copy of the agreement within the allowed timeframe, or else the individual could find their credit rating affected.

“However, no judgement has been made in relation to the credit rating where a debt is irredeemably unenforceable or where there has been an unfair relationship, and no court enforcement action can take place while the creditor is in default.”

David Berkley QC, of St Johns Buildings, has 30 years’ experience of consumer credit law.

“The High Court decision has its limitations in terms of its scope,” he said. “Despite an invitation to do so Mr Justice Flaux did not expand his judgement to deal with the range of hypothetical situations.

“There is nothing to suggest that, on appropriate facts, the court might not intervene in order to prevent such action being taken.

“For example, this might be where it is arguable that the threat of reporting to credit reference agencies is being used coercively, or if such threat were to follow a finding by a court that a credit agreement is irredeemably unenforceable.”