This is a simple guide to reclaiming unfair penalty charges from your credit card provider.

Credit card providers charge you a fee if you go over your limit or make a late payment. These fees have been limited to £12 since April 2006, following a report into the charges by the Office of Fair Trading. Prior to that they were around £25 sometimes even more. The OFT did not say that £12 was a fair charge level they actually stated that only a Court can decide a fair charge level and they would not investigate at that level or below.

Can all these charges can be reclaimed?

Yes, this is because the charges are deemed penalties and unfair under the Unfair Terms in Consumer Contracts Regulations.

Under common law penalty charges must be proportional to the providers costs for your breach of contract.

It is estimated the cost to the credit card providers is actually in the region of £2.50, quite possibly much lower.

Any charges which are disproportionate penalties or terms which are unfair are unenforceable in their entirety and therefore the total amount can be reclaimed.

You are not limited to just reclaiming the difference between the actual charge and what may be considered as a fair level.

You can reclaim all charges on credit card accounts since you entered your agreement with the credit card provider, however charges before 2003 may be defended by the credit card provider under the Statute of Limitations Act.

It is arguable that a Consumer could not reasonably have been aware of the penal or unfair nature of these charges until the OFT report in April 2006 and that Section 32 of the Limitation Act is therefore applicable, you are consequently entitled to reclaim ALL charges, not just those incurred over the last six years.

In order to begin reclaiming your charges you need to obtain all your transactional history from your provider. This can be in the form of statements (if you have kept them) or you can ask for the information under the Data Protection Act (DPA).

STEP ONE

Send this letter to your credit card provider with a cheque or postal order made payable to them for £10. This is the maximum fee they can charge for providing ALL the information they hold about you. This is known as a Subject Access Request (SAR)
They have 40 days to provide this information.
Template for SAR letter >>> HERE

If in any doubt please start a thread on the forum ( CREDIT CARDS - Legal Beagles ) and ask for assistance. You can also use your thread to keep a note of your progress.



STEP TWO

Go through your statements/transaction lists with a highlighter pen and pick out all of your charges. These will be listed as Overlimit or Late Payment fees.
Then you will need to enter these charges in to a spreadsheet which you can find here >>> HERE
This will calculate your total charges and add an element of compensatory interest.


If in any doubt please start a thread on the forum ( CREDIT CARDS - Legal Beagles ) and ask for assistance.

STEP THREE

Send the PRELIMINARY LETTER >>>> HERE
Do not send a copy of the spreadsheet at this stage.
This letter asks for a refund of all charges plus compensatory interest and gives them 14 days in which to respond to you satisfactorily.

If in any doubt please start a thread on the forum ( CREDIT CARDS - Legal Beagles ) and ask for assistance.


STEP FOUR

Send the LETTER BEFORE ACTION >>> HERE , this time with your spreadsheet attached.
This letter repeats your request for a refund of your charges together with compensatory interest.
You may need to amend this letter slightly if they have replied to your PRELIMINARY LETTER.

If in any doubt please start a thread on the forum ( CREDIT CARDS - Legal Beagles ) and ask for assistance.


STEP FIVE

If they fail to respond by making an offer that is acceptable to you then you will need to commence Court proceedings.
Most credit card providers will not take your claim seriously until you do actually commence Court proceedings.
If you get to this stage then we definitely recommend that you start your own thread in the relevant credit card forum - you can find these >>>> HERE

You can find instructions and templates for taking your claim to court on this thread >>>> HERE

Don't forget, the Team and other members at Legal Beagles are here to help you at every stage of your claim.

The best way you can help them to assist you is to start a thread in the relevant forum and keep the thread updated with details of your claim and how it is progressing.