BBC Panorama write off debt | Loophole clears couple’s debts | Write off illegal unfair loans | Consumer Credit Act 1974

BBC Panorama Programme: 'Can't Pay, Won't Pay'

As more people find themselves in debt, one couple found loopholes in their credit agreements to avoid paying tens of thousands of pounds. But a High Court judge had the final word.

Amanda and Basil Rankine ran up debts of £120,000 after their mortgage advice business collapsed and they found themselves unable to afford their monthly payments.

Their debts were spread over 13 credit cards, four loans, car finance and an overdraft. They decided to study the Consumer Credit Act and contacted lenders claiming they had found mistakes in their credit agreements.

The Act lays down the rules which companies have to follow when they advertise or sell credit.  “I studied the Act and decided that there were things that didn’t match so I put together a bit of a letter to HSBC, thought I had everything correct, and sent it off,” Mr Rankine told the BBC’s Panorama programme.

“They wrote back, and after a few months said we’re prepared to write balance off.”

The Rankines, from Rugeley in Staffordshire, looked at all their credit agreements and identified potential loopholes.
These included whether the correct annual percentage rate (APR) was used, whether the forms had actually been signed and if the lenders had kept a copy of the paperwork.

In this way, they managed to have a number of their 13 credit cards and loans written off, to the tune of £37,000, including the sum from HSBC.

Sir Roy Goode, an eminent commercial lawyer who was instrumental in drafting the Act, said the rules relating to credit agreements were “extremely complex”. “So any slip that is made entitles the consumer to refuse to pay unless the court gives leave to enforce the agreement,” explained Sir Roy.

Mr Rankine said: “Now more people challenge agreements, and more people will realise… the law is there so they have a choice. Challenge or repay at their level, or challenge and repay at your level.

The couple decided to take their remaining creditors to court over loopholes they believed they had spotted, and in an attempt to set a legal precedent that may benefit others. But the case was dismissed by a High Court judge, who said the couple were wriggling out of debt.

Despite the judgement, a legal technicality – which meant the lenders could only claim the money back while the court proceedings were going on – meant the couple still managed to get most of their debts frozen.

That took their total debt clearance to £100,000, leaving more than £20,000 outstanding. However, a legal bill of £100,000 left the Rankines back where they started. They don’t accept they lost the case and they say they would prefer to be paying a legal bill than paying a debt they thought was unlawful.

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Possibly related posts:

• BBC Panorama write off debt | Loophole clears couple’s debts | Write off illegal unfair loans | Consumer Credit Act 1974
• Unenforceable Credit Card Agreements | Advice | Write off Debt Under the Consumer Credit Act 1974
• Clear your Credit Cards & Loans legally due to flawed Credit Agreements

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