Littlewoods refused payment plan...

[wetwipesareus]

My Dad is 85
He and my Mum had a littkewoods catalogue.
They paid £150 a month
My mum passed away and Dad had to pay for funeral (mum had no insurance )
So now he just has the one pension and they have stopped his pension credit as he is slightly over the threshold.

I wrote a email to the specialist department explaining mum died and he could no longer afford the £150
I asked if we could set up a p/p for £80 a month
They said no
This was their reply

Would he get into trouble if we just pay the £80 a month ?
He's never missed a payment in 20 years

Find out what interest rate is being charged - I expect its very high - these kinds of catalogue credit arrangements are often interest rates around 30% which would mean the interest alone would be at least £60 per month.

If he hasn't been late in payments yet and doesn't have any black marks on his credit score then he may be able to apply for a 0% credit card to transfer the debt to. Look on moneysupermarket.com and see if there's a card that will accept him offering 0% for 30 months - if he can be disciplined and not run up any more debt (make sure he closes the littlewoods account asap) then the £80pm will almost clear the whole debt by the time the 0% window ends.

If he won't be accepted for a credit card then a credit union might be able to help him transfer the dent to a lower interest rate.

Littlewoods don't charge interest. The balance he has is fixed.

That doesn't seem likely. There are probably 0% deals for quick payment but that would apply to historic debt

44.9% interest on a £2,800 debt is £104.77 per month just for the interest alone.

I like someone else's idea of taking out a personal loan. Pay it all off and spread the repayments so they are affordable.

I honestly don't think that companies like Littlewoods, Very etc should be allowed to operate BNPL as the interest is so high. People are drawn in and fall in to the trap of thinking that 12 months is a long time and they'll have the money by then.

I honestly think this should be illegal. I don’t tend to do store cards/ catalogues but signed up to Very as got 20% off first purchase on a pay in three instalment plan. I paid it in full but I was appalled at how easy it would be to get into very expensive debt. I think interest should be capped at a max of say 20% above the base rate.

Ex catalogue/store card finance employee here.

PP is right, it's not possible to have a joint catalogue account, someone's name would need to be the main account holder. I'm assuming it's your dad as he said he was asked if he had wife etc but you need to check because obviously if it's in your mums name then things are very different.

If it is in your dad's name the best thing you can do, as pp have suggested, I'd get a 0% interest card and pay it off. This should be possible if you have no credit history (as long as you don't have adverse credit). If it's not possible for you then maybe suggest doing an online application for your dad with him present? You can check eligibility before you apply for a lot of companies, and this doesn't affect your credit score. Get online copies of yours and your dad's credit file if you want some extra peace of mind before applying. Easily done and free with companies like ClearScore and they'll also tell you any pre approved cards/loan choices you have based on your details.
The above would lower your dad's payments by so much and make it much more manageable for him. My minimum on my interest free credit card is £28 for that kind of amount. I'm not suggesting he only pays the minimum of course, but it gives him flexibility.

Alternatively, write a letter of complaint regarding Littleswoods reply. State your father is vulnerable and his payment offer needs to be reconsidered. There's templates for letters like this on the Martin Lewis website.

It’s clear his financial circumstances will have changed following the death of his wife and the loss of her pension income. I would go step change or equivalent all the way. They will help leverage his status as a vulnerable customer. If he’s not capable of an appointment can you book it and attend with him? I’m sorry he’s in this position

Try asking for advice on debt camel xx

I might make a subject access request so you get all the documents and can see what the arrangements were when they set it up.

There have been cases where there are no documents so the debt is not repayable

I mean. They can’t get blood out of a stone. You need to ring banks. Charities and citizens advice regarding this matter
y friends husband left her and she couldn’t afford all the credit card debt. She did the same thing and they said no…but she literally couldn’t pay it. Once they realised they wouldn’t get their money they did the payment plan.

Have you seen the bills? It is very unlikely that it's in both names because that's just not how it works. If it was in your DMs name, chances are that they will write the debt off once they have proof she's died without any liquid assets.

However, if it's in your DFs name, he does have to pay, but if he cannot afford this, he needs further advice. Does he own or rent his home?

You're referring there to BNPL. Which kicks in at the end of the term. But again it's a fixed lump. You're told the total amount of interest you'll pay altogether. It's not going to be added to as the months go on.

Littlewoods balance is fixed, any charge for credit is included. It's not going to be recalculated every month like a credit card. It's done at the time of ordering.

Very the sister catalogue does it differently so your balance can go up. Places like NEXT charge interest monthly on your balance.

I've ran a Littlewoods catalogue for decades. It's the better out of the lot of them.

Tbh OP i think you need to look at what your dad can sell in order to pay down some of the debt - £3,000 is quite a big debt for someone on a low income and im surprised they let him accrue so much.
£150 is 5% of £3,000 which is quite a lot but if the interest is high they do have to ensure he is not just building further debt - in some respects they are being a responsible lender not agreeing to a payment level that will see him going deeper and deeper into debt.

The reason the interest is so high is because they are willing to lend to people who are often unable to get credit anywhere else. As a result a higher proportion of their customers will run into difficulty paying and debt will be written off.

Are people forgetting that this is a pensioner whose wife has recently died? It sounds like he doesn’t have any spare income other than state pension, would likely never get a credit card, let alone an interest free one, and hes being hounded for what is, in the grand scheme of things, a very small debt.

OP, contact Stepchange asap.
https://www.stepchange.org

You might also get some ideas by reading this.
https://www.moneysavingexpert.com/loans/debt-help-plan/

Does your dad own his own home? If not look into a "Debt Relief Order". Step Change could help / advise on whether appropriate.

https://www.stepchange.org/how-we-help/debt-relief-order.aspx?gadsource=1&gbraid=0AAAAAD1toAgAOVoxhch7HcadsNZhRJQQ_8&gclsrc=ds

That's enough debt to get help, and probably a debt relief order, depending on his other circumstances.

Contact StepChange, they will assist.

I would get advice from Stepchange (Christians Against Poverty is another I hear recommended) as others have said. I think if they haven’t listened to you asking for a reduction they will be more likely to listen to an experienced company who know how to broach the topic and know the rules and regulations regarding customers in financial hardship inside and out. If you just pay the £80 Littlewoods may add charges and take action, a company like Stepchange can ask them not to add charges on.

Why do they listen to step change ? But won't listen to a customer asking for help
So it's not a case of they can't help they just won't

Because people like Stepchange know the law and will get the information that Littlewoods will need to change their decision.

Think of Stepchange as the woman with a big stick

Stepchange are fab, they will do a quick call with your dad to go over his income / outgoings and make sure that he isn't going short in order to pay debts and he really can afford the £80 a month then they'll contact Littlewoods and deal with them, it will probably mean a default on his credit record and make it difficult to get any other credit.

One other option you could try is posting on moneysavingexpert, I suspect you might be able to go down the complaint route with Littlewoods / FSA and get something knocked off the debt - MSE is the best place for advice on that though.

Have a look on the account statement paperwork. I used to be a volunteer at CAB and I have never seen a joint credit catalogue account.