Erudio Student Loans Continued

[halfpricedebt]

Started a new thread following mrsbug's request.

I got an email from Erudio today telling me that an issue I raised with them on 27 March that was then completely ignored even though they asked for confirmation of my details to process the initial email. I gave them the details they requested and seven days later I still hadn't heard anything. So I wrote them a rather threatening complaint telling them if they didn't respond within 7 days I would report them to the relevant financial services. That was on 3 April and today they've told me that my complaint has been forwarded to their Customer Resolutions Team.

I wonder what they do?

I wrote to erudio requesting copies of my loan agreements (95,96, 97)included a £3 cheque.
As a SAHM, I've always deferred, with letter of support signed by DH.
I am taking the stand that erudio must now prove, under contract law, that I owe them. They bought the loans the debt is theirs. I will not fill out their form, or re contract with them. 2weeks and waiting. Interested for their response.

@ coffeeonaswing I'd be really interested to hear their response to that one too. My first post on the thread questioned whether acknowledging the debt, by signing their form or whatever, was your acceptance of Erudio as the new owner of the debt. From what I've read in the legislation, the 1990 Act didn't permit transfer of the loans to the private sector, but the 1998 Act was amended to allow it (seems to be the only significant amendment, along with changes to the administration of loans, and the 1998 Act was only in force a matter of months before being replaced by the income contingent loans).

What I'm not sure about is whether that amendment can be applied retrospectively to loans taken out under the 1990 Act, from 1990-98? I always thought legislation couldn't be applied retrospectively, but I don't know enough about how the law works to know for sure.

Good luck, keep us posted on how you get on!

Also to note, if the original agreement, does not have both my signature and is counter signed by a government representative, the agreement is null.
Really important to urge people not to sign a contract with erudio. They will use insistent and threatening language. But you don't have to.
The question is, who was the contract between? Then that is to whom I owe money.
If a 3 party pays my debt( by 'buying' it) it's a settled debt.
If our government are prepared to allow people to be hoodwinked, shame on them.... Are we surprised?
Big business masqueradeing as democratic government!

well minimoosh, Zach Lewy actually stated that they have to share info with CRAs to get info. My interpretation was that they are trading that info, based on the main man's statement. Put another way, they are using our loan info to save themselves having to pay to perform checks on us all, looking for info that trips our deferment form answers up. So, if your assessment is correct, i think this fully proves that they have broken some rule/law. The responsible lending argument was destroyed by Lewy's statement in my opinion. 'Promoting' can obviously be interpreted in a number of ways but makes little difference if they are trading this info as Lewy stated.
I also had a little discussion on the longest MSE forum page in the last few days about another area i feel has been overlooked and where they can be challenged in relation to reporting our info to CRAs. That concerns our info affecting 3rd parties. BIS stated to me our loans in no way affect another human being and are ours alone. Yet the deferment forms on the last page say CRA info can potentially affect 3rd parties. If BIS was right, then if either Erudio, Thesis, SLC or anyone else reports students loans to CRAs, then they may have indeed broken the law. It is only a small point but the devil is in the details. We need to find a definitive answer to whether BIS is correct though, but i am very confident the person who told me was about as good as it gets on this issue and has been right about most things thus far.

Much as I hate Erudio that is all nonsense.

Debts can be assigned and these are credit agreements. The agreement terms themselves allow for the sale.

Credit agreements only need the signature of the debtor to be enforceable.

Someone buying your debt under a proper assignment does not 'settle' it, and the assignment means you owe the buyer just as you did the original creditor.

With respect, we've been through that on this thread or the older one already.

@Euridoed

It isn't breaking the law reporting a loan that may affect someone else. It's just how financial association with other people on credit reports work. If Erudio have the right to report the loan that will happen. No law breaking involved.

@mandakl
From what i understand, and you may indeed be right that they are exactly the same as other loans, but i was told categorically that student loans specifically affect no one else because it is different to other similar style loans. As such, IF that is right, to me it makes sense that if Arrow were to decide to report it to CRAs then they would be breaking that rule/law/term or whatever it is.

Can I just check - do those with loans with Thesis/Honours have deferred loans reported to CRAs? I know they already have SLC process deferment and I imagine they aren't. There seems to be a serious problem with borrowers being treated differently.

I had a good meeting with my MP today at his constituency surgery which was heartening.

I know some loans in default were reported by SLC, well according to things i have read around. And my notion stated above would apply to defaulters as well as to deferers i guess. If a student loan should not affect a third party full stop, then it shouldnt matter whether someone is a deferer or done a runner in theory...unless going into default were to take any protections off, in which case maybe it would be ok for them to have their actions affect 3rd parties.
But please dont take most of what is said on these forums (and especially my post above) as factual, it is just speculation, looking for someone to say it is wrong or take the argument forward in the unique way forums allow.

If reported to the CRA a student loan can affect a 3rd party if they are an linked associate on your report.

You have been simply been given duff information that it can't.

@ erudioed I'd forgotten about the Zach Lewy statement, I hadn't thought of it in terms of Erudio getting freebie searches on our credit files, makes far more sense than their responsible lending argument! If it turns out Erudio do need our consent and they've gone ahead and disclosed personal data without it, then they have broken the law - I would have thought that any person financially linked to you would then be able to seek redress, the same as you, through the ombudsman.

If Erudio do cock up big time over the DPA consent issue, the ICO can impose a fine of up to £500k... add that to the £550 per FOS complaint, and Erudio's return on investment would be taking a bit of a hit.

@ mandakl I appreciate that debts can be assigned, but these aren't your usual credit agreements, they have to meet the requirements of the student loans legislation, as well as the CCA.

You mentioned before that the Sale of Student Loans Act allowed the Government to sell off our loans, but that Act only applies to the income contingent loans, not our mortgage style loans. They seem to be relying on the revised 1998 Act to legitimise the sell off, and that doesn't sit right with me, mainly because I thought legislation can't be retrospectively applied, not to contracts anyway.

Anyone taking out a student loan once the amended 1998 Act came in would be aware of what they're signing up to. Anyone before that date couldn't possibly have known (and certainly didn't agree to) their government loans could be sold to the private sector... how can that be legal?

There is other legislation enacted in 1998 that authorised sales. And yes there is SL loan legislation that covers them, but they can also be assigned like any other credit agreement. The SLC even had to obtain a normal CCA license to issue and administer them in exact the same way any other company issuing credit agreements has to.

I know people are upset by the sale, but if you think successive governments were looney enough to illegally sell off loans without a cast iron legal basis for doing so, then that is going beyond daft.

And you saying that people were not made aware the loans could be sold on is completely untrue.

People may have been too lazy to read the loan agreements, but the ones we signed clearly said in black and white.

6 Transfer of Rights and Duties
6.1 We shall have the right to assign or transfer all our rights and duties under this agreement to any person without your consent.

That is straight off an original agreement of mine from mid 90's.

If if or buts or maybes about that. In was in back and white in what we signed on the dotted line for.

And if you want the legislation that authorises the sales then here it is:

www.legislation.gov.uk/ukpga/1998/1/enacted

That incorporates that section into the 1990 Act.

(and yes, they can do that)

Then repealed, but as it says in the SI that repealed it:

www.legislation.gov.uk/uksi/1998/2004/made

(2) Without prejudice to the generality of paragraph (1), the repeals of the 1990, 1996 and 1998 Acts shall not affect the continued operation of any such provisions relating to any of the following functions:

(a) the making of subordinate legislation;

(b) the assignment of public sector loans under section 1A of the 1990 Act;

(c) the making of arrangements (including arrangements which provide for the making of payments of any specified description) in connection with such an assignment.

All above board. All legal.

1 Transfer of public sector student loans to the private sector

After section 1 of the [1990 c. 6.] Education (Student Loans) Act 1990 there shall be inserted—

“1ATransfer of public sector student loans to the private sector

(1)A relevant lender may assign to any other person all or any of the lender’s rights in respect of any public sector student loans.

(2)The Secretary of State may make such arrangements as he thinks fit for the purpose of facilitating, or otherwise in connection with, an assignment under subsection (1) above.

(3)Arrangements under this section may provide for the Secretary of State to make payments of any specified description which—

(a)are payable in such circumstances, and at such times, as may be specified, and

(b)are of such amounts as may be specified in, or determined in accordance with, the arrangements.

(4)Such arrangements may authorise the Secretary of State in specified circumstances—

(a)to take an assignment from the purchaser of all or any of his rights in respect of any loan to which the arrangements relate, or

(b)to direct the purchaser to assign all or any such rights to some other person under subsection (1) above.

(5)Such arrangements may also provide for the appointment of an independent person approved by the Secretary of State with the function of investigating and reporting on any dispute between the purchaser and the borrower under a loan to which the arrangements relate.

(6)Subsections (3) to (5) above shall not be read as affecting the generality of subsection (2) above.

(7)In this section—

“assignment”, in relation to Scotland, means assignation;

“the purchaser” means the assignee under an assignment under subsection (1) above;

“relevant lender”, in relation to a public sector student loan, means the person who made the loan or the assignee under an assignment under subsection (1) above;

“specified” means specified in arrangements under this section.”

I have mentioned both the 1990 and 1998 Acts in previous posts so have seen that.

My point was that the original Act didn't specifically refer to the private sector (to correct your earlier post, I didn't say that borrowers weren't made aware that loans could be assigned, just not specifically to the private sector). Every other borrower post-98 had the luxury of knowing that before signing on the dotted line - I don't think it's unreasonable that borrowers before then might have had an expectation that they were taking out Government loans that would remain with the Government, regardless of standard clauses re assignation in the agreement.

The Government must have considered it significant enough, to amend an 8 year old Act to specifically refer to transfer to the private sector, and then replace the revised Act months later with a new student loans system and new Act.

Looney? You only have to watch half an hour of PM's Question Time to know the Government has its share of them.

And you can buy books on the epic legal/financial blunders of this and previous Governments, they're pretty well renowned for it, and our loans book is small fry compared to some, so I don't think it's beyond the realms of possibility that they fucked up along the line, more like there's a good chance that they did.

@mandakl: "If reported to the CRA a student loan can affect a 3rd party if they are an linked associate on your report.

You have been simply been given duff information that it can't."

For the 2nd time, that isnt the point i'm making. Your statement isnt up for debate, nor was that what i was told!
The point is, that IF, the big IF in my question, our loans should not affect anyone else (as i was told) then the very act of reporting them to CRAs (as CRAs have come to be used over time after we signed our agreements), they do actually affect 3rd parties, then i would assume the notion of our loans affecting anyone else would be superseded by that original notion. I know others cant become liable even if in default for payment of the money. Mine is a lesser point but it does have the residual proviso of affecting credit searches for others.

@minimoosh: i feel Lewy's argument is the actual reason because why would Arrow be remotely interested in promoting responsible borrowing and lending...after all, if that was the reality, they wouldnt exist as a business and he would be chucked out of his own company for damaging his business model, or failing that, they wouldnt have much future business to look forward to. We know Arrow signed that agreement with Experian, and i assume this was part of it, probably the biggest part of it...giving info to get free info searches. CRAs get more loan based info, their value goes up etc etc. In return Arrow get to conduct free searches on the 50 or 100,000 of us in deferral. Who knows, maybe by giving our loan info, they get deeper access to track down the 45% odd of defaulters that they are/will start chasing down very soon after they have finished processing deferrals. If they are trading or selling our info, then i feel that to be an area of investigation.
Maybe it is all legit but these big companies and the government do sometimes overlook such points, and allow such practices to continue for some time before they are reigned in/punished.
When someone defaulted and SLC put them on CRA lists, maybe that is because the rules no longer apply. We have been repeatedly told that SLC had the right to put deferers on CRAs but chose not to. Maybe there is actually a more legitimate reason for that, other than an act of kindness or poor/lazy practice. After going into default, SLC, i was told, used debt collectors before, so after having info placed on CRA lists, the person will have been dealing with the debt collectors and such minute details as having 3rd parties affected may have been the very least of their concerns. However, with us, one of the ways we have been told it will appear on CRA lists is all in the positive and that it will actually 'help' our files. However, that info i stated about it affecting 3rd parties flies in the face of that. As such, my contention about what the person said at BIS about our specific loans not affecting another person, 'IF' it is correct, fuels this issue. Mandakl's point is obvious and a reality for a number of years since the growth of CRAs, but the very centre of my point, that others are affected, which in my opinion is a negative no matter what we are told about how positive it will be for us. It seems to me as a contradiction and therefore worthy of thought. If its wrong ok, but we arent exactly lawyers, so it makes sense to me to explore it a bit.

Remain the fact that that they were sold legally, and from the side of the agreement T&Cs that this could happen was in those.

@Erudioed.

It's very obvious, and always has been. that Erudio want to do things for reason beyond what they actually say or state. Reporting data to the CRAs is one of them.

They and we know that this information can affect people negatively, and even where not that will be people's perception of it, putting a subtle or non too subtle pressure on people.

The point on reciprocity has also been mentioned before, in that a company can only get data back to the level that they happen to share with the CRAs. Did wonder at one point if that was slightly off here as the parent companies already have that access, but ICO and the CRAs assure me that in cases like this they would need share under their own capacity in order to get back. While the reasons for them wanting to to that are obviously far beyond the good ones they state, as it is a fantastic debt collection tool as well, it is certainly legitimate and legal.

Question is does that s16 give permission to share with the CRAs?

That is debatable, though having asked a couple of legal bods who do a lot of DPA work, they are of the opinion that it does.

However, what they said is certain is that if that consent was valid and specific enough then, it still is now, as later provisions of DPA etc do not in any way revoke it or put restrictions on it beyond the normal legitimate interest tests etc.

As said, I think the more productive thing to explore is the original terms for pre 98 loans and challenge whether the consent clearly given on those to "if they judge appropriate" disclose to "any person any information" regarding the agreement.

Despite assurances to the contrary from learned DPA people, seems to me to be somewhat shaky ground there?

@ mandaki "Remain the fact that they were sold legally..."

That's your view, and we're all entitled to one.

Sometimes Governments get it wrong, sometimes minimoosh gets it wrong, even mandakl sometimes gets it wrong.

Whether I'm right or wrong, I'll still question the legality of the sell off, same as you'll still be certain it's all above board. Different views is all.

I respect that.

Afraid that some of the previous responses (not yours) were getting into the more whacko FOTL territory, which is a dead end argument and does harm to even give it credence. I may have misdirect a bit of annoyance because of that. Oops.

Still, the loans were sold legally......... :P

If you want to investigate the legal side, a forum like swarblaw.co.uk/ may be of more use to check that?

As and, I've bent the ear of people I know in the legal side of DPA and contract, and they seem to think it is cheeky but legally fine, but more opinions could help.

Thanks for the link mandakl, will have a look later.

Just received an acknowledgement letter from Erudio for my complaint on the DD and DPA issues, they've said they may need to contact the originating creditor and/or their external agents for further info (don't know if that's just the bog standard response), but I would hope that includes the ICO, in which case we should have a definitive answer on the consent issue soon.

@ erudioed I agree that the impact on others financially linked to you is worth exploring. I suppose "if they judge appropriate" to disclose info, Erudio has to have sound justification for doing so, particularly when it affects third parties financially linked to you. Disclosing info on defaulters, I think, can be justified, but not sure their reasons for disclosing deferred loan data hold much weight.

I did read that when the SLC started reporting defaulters in 2009, it was questioned whether this breached DPA requirements - and that's for defaulters, where you might reasonably expect it to be reported to the CRA's.

What? Unless it means their "advisor's" on DPA etc matters?

SLC only ever issued agreements with 2 forms of wording, so there is nothing to contact them about.

If not exactly standard wording, it's certainly stalling for time.

With the Big Daddy companies to back them up, they must have access to an internal legal team? By agent, they could mean mediator, so FOS/ICO, who knows. Whatever their abysmal use of plain English is referring to, they'll have to show their hand soon, when they respond to the first complaints.

I thought there might be something relevant in the agreement drawn up between the Government and Erudio, which they need to sort out?

All speculation, they probably are just stalling so they can justify an 8 week response time.

@mandakl

6 Transfer of Rights and Duties
6.1 We shall have the right to assign or transfer all our rights and duties under this agreement to any person without your consent.

True, but at the same time that doesnt mention sell/sale etc anywhere. Assign or Transfer - reading that as a person not well versed in legal parlance doesn't necesarily scream "we can sell your loan to whoever we please."

Or more accurately, Im not sure my 18 yo self would have stopped to consider this or the possible implications. When judged by the same criteria as the whole PPI debacle i think this possibly falls under the category of miss-selling. (although i doubt there is any mileage in that)