Kreation Finance: a bad fairy tale

One upon a time someone, let's call this person Alex, secured a loan from a finance company, let's call them Kreation Finance.

Alex got into difficulties with her repayments, but with managed to come to an arrangement to pay of the balance (about £300) with low but regular monthly payments until such time as she could afford to increase these.

But Kreation were not satisfied, in spite of agreeing to this payment plan. They started phoning Alex several times a day, a practice which is harassment and which, obviously, caused Alex considerable anxiety. Imagine not wanting to answer the phone because the chances are it is going to be someone being unpleasant about your loan, time after time! Imagine the stress every time the phone rings!

Borrowers are, in fact, protected from this type of activity by the Protection from Harassment Act 1997.

With help from an advice centre Alex complained to the Office of Fair Trading, who made sure that Kreation desisted.

But this was not the end of the matter. You might say it was a coincidence or you might say it was a textbook case of sheer vindictiveness but for whatever reason Kreation then took the perfectly legal, but utterly unreasonable (in a case where the debt is small and actively being repaid), unethical, and bloody-minded step of taking county court action against Alex.

The result: a county court judgement against Alex which will effect Alex's credit rating for years to come. Just because Alex complained about being harrassed? The county court judge was critical of the finance company but obliged to follow the law and grant the judgement.

Unsurprisingly this is not the only example of lenders like this behaving badly - see "Car debt nightmare".

As in all fairy tales the villain can't just be an institution, though. It has to be the miserable SOB(s) who made the decision to take court action. And we all know how the villains in a fairy story must come to a sticky end.