A friend received a letter about a credit card debt. He wont mind me talking about it here.

Many people are victims to this situation over the last decade in that we have borrowed far more than we can actually afford to repay. We then need to enter into a payment arrangement according to what we can afford to pay them.

A lot of firms that lend money are now getting pissed off with the fact that we borrow, cant afford to repay and enter into an arrangement that we cant afford.

You have probably been in an arrangement of sorts for a while now and have had a threatening letter saying that after a review period of six months (or what ever) your payment is going to increase or your interest rate is going to hike. It has to stop because this is all designed to keep you in an endless cycle of debt with the loan companies.

In 2008 the government had a conversation with the UK cards association (APaCs). Certain guidelines were set out with regard to the fair treatment of customers including those in financial difficulty.

If you Google the term APaCs credit card you can find ample information about the subject to help you and it is quite useful. If you have a problem with regard to credit card companies taking steps to increase your payments to a level you cant afford you do have a case with the financial ombudsmen and also the county courts if need be. As with all cases of debt the financial institutions are praying on your ignorance of the law and expect you to abide by there decisions. Well I'm afraid Mr Credit Card people the gloves are off now and its pay back time.

Below is a template of a letter I used to help my friend out:

Dear Sir or Madam,

Account number: 12345678

I am writing to make a formal complaint with regards your letter dated 26/10/2010 stating you are going to increase the interest rate of my credit card.

This breaches the Principles on Repricing agreed between the UK Cards Association (APACs) and the Government in Dec 2008 and I would like to protest about the increase as

You agreed not to increase interest rates where an agreed repayment plan is in place in respect of the account, or where you have been formally notified by a not-for-profit debt advice agency that a customer is in serious discussion with it. I already had an agreement in place with you to repay £25 each month and you have already forced me in to agreeing an increase of £30 a month. Along with these facts and your most recent letter you are definitely in breach of the principles.

Unless you can satisfactorily justify to me that you have followed all aspects of the repricing principles and treated me fairly I shall be contacting the Financial Ombudsman to investigate my complaint, at which point I will also be asking to be compensated for any loss the increase in rate has caused me and for my time.

Of course if you would simply like to leave my interest rate at the current figure with continued use of the card I will accept this course of action.

I look forward to a full and prompt response to this letter and for the matter to be concluded within eight weeks before I escalate my complaint.

Yours faithfully,

Jack Jones

I have disguised his name and account number to protect his identity but the rest of the letter is what was sent. I will of course start another hub on the results that were achieved with this and anything helpful. As a parting note there is a way to avoid paying your credit card debts that you cant afford using a little know paragraph in the consumer credit act and I will produce a hub on this also.

Thanks for reading and see you soon.