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Joshua
Joshua, Lawyer
Category: Law
Satisfied Customers: 26070
Experience:  LL.B (Hons), Higher Prof. Dip. Law & Practice
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Is it a legal responsibility for a creditor to inform the lender

Customer Question

Is it a legal responsibility for a creditor to inform the lender that the loan repayment has been received?

Are there any consequences if ones' fails to do so?
Submitted: 3 years ago.
Category: Law
Expert:  Joshua replied 3 years ago.

Joshua :

Hello and thank you for your question. I will be very pleased to assist you. I'm a practicing lawyer in England with over 10 years experience.

Joshua :

May I kindly clarify with you please - who is the creditor and lender you refer to please? The reason I ask is that obviously a creditor and a lender are the same thing in many respects.

Customer:

Sorry

Customer:

Creditor

Customer:

and debtor

Customer:

So when a debtor has returned the money to the creditor asking for confirmation is it the creditor's responsibility to inform the debtor whether he/she has received the money already

Joshua :

Thanks. That makes sense. Is this a commercial creditor or private please?

Customer:

Private

Customer:

Independent loan

Joshua :

thank you. There is no strict liability on a private creditor to inform a debtor on receipt of the payment however if the creditor wishes to bring a claim against the debtor, there is a responsibility for the creditor to maintain an appropriate record of the debt so as to enable any quantification of justification of the debt to the debtor

Joshua :

in addition, if the creditor holds any security over the debtor which is to be released upon repayment of the loan and the creditor has failed to do so, the debtor has a right to require the creditor to so release the security.

Joshua :

is there a particular issue with regards XXXXX XXXXX creditor's failure you refer to for the debtor?

Customer:

Ok first

Customer:

I have transferred the money last Monday

Customer:

My bank said it would take only 4 days max

Customer:

up until friday the creditor claims to have no received the repayment

Customer:

then i showed him the document of repayment then he accused me of forging a document which is totally legitimate

Customer:

then i requested for a check on whether the money is there

Customer:

then i havent heard back since

Customer:

but my bank said that the loan repayment should've arrived on thursday hence they suspect the creditor's been deceiving me in not having received the loan on friday

Customer:

and i havent heard anything back since

Joshua :

Thank you. would I be correct to assume that you obtain the creditors bank details from the creditor in writing please?

Customer:

From a text message yes.

Joshua :

thank you. On that basis, the evidence of payment made to the account from your bank is prima facie evidence that you have made payment against the loan. Prima facie means that the evidence is so strong that it creates a presumption that the loan payment has been repaid and it is then for the creditor to disprove this. Accordingly, based upon the evidence of repayment you have from your bank, you do not need the creditors confirmation or acknowledgement of repayment is the evidence you already have amounts to prima facie evidence in its own right of the repayment

Customer:

anything i can do for the friday allegations?

Customer:

As it is totally unfounded

Customer:

it is definitely in the account already

Joshua :

if you wish to obtain further confirmation, you could consider writing to the creditor advising that payment was made on [date] to the account details specified accordingly you consider all further obligations discharged following the repayment and unless you hear from the creditor to the contrary within say seven working days, you consider your obligations towards the creditor at an end

Customer:

I have done that.

Customer:

But it's been rather difficult communicating with this creditor

Joshua :

as above, you already have evidence of repayment, the evidence you have from your bank is sufficient in its own right and it would be for the creditor to prove that he has not received the payment if you wish to claim anything further from you

Joshua :

is there anything above I can clarify for you?

Customer:

Could this be fraud trying to trigger me to trasnfer the money again?

Customer:

transfer

Joshua :

there is no fraud at present because there has been no gain on the part of the creditor. If you were to fraudulently claim that he had not received the repayment and you made further payment this potentially could amount to fraud however there is really no chance of this because he would not make a further payment to the creditor on the basis you have already made payment to the correct account details. On this basis, I do not consider that you need to take any further action whatsoever as it is up to the creditor to take steps if the is to claim he has not received the money and from there it would be a question of asking your bank to establish with his bank that the money has been received using their tracing procedures

Joshua :

on the basis you have made payment electronically through your bank, there is really no question in practice of him claiming that he is not received the monies as such payments are fully traceable

Joshua :

is there anything else I can help you with?

Customer:

not at the moment

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