Managed Loan

BigDebtBoy · 4 April 2006 at 7:57PM

Hi
does anyone know much about managed loans my bank is trying to get me to have a managed loan to cover my personal loan/credit card and business loan/ business overdraft
would i be better sorting out a dmp/iva/bankrupcy as i cant see them greedy barstewrds doing it out of the kindnes of there hearts so will probally be looking to charge me 1000% interest

anyone know much about them ?

BigDebtBoy · 4 April 2006 at 10:15PM

no one know owt about these then ?

sillyrabbit · 4 April 2006 at 10:59PM

Hiya,

My first post! I have a managed loan, and I think that the rate is no worse or better than a normal loan from a broker. I have £10K over 7 years, I think, and I pay £200/mo. I think they just like to see everything in one place and know that you have some sort of handle on it. I don't think my interest rate is too high, but I don't have the details to hand at the moment. I have no idea about bankruptcy, etc.! Sorry!

Helen

CLAPTON · 4 April 2006 at 11:04PM

any facts atall?

Glitterari · 7 April 2006 at 12:31PM

Hi,

I have a managed loan with HSBC. I've just run upstairs to get some paperwork, to give you some facts and figures...but i'll tell you my experience of it too.

Back in Aug 04, I was in quite a bit of financial difficulty, so I went to the bank for some help. They tried to sort a normal loan for me, but I was refused. I was constantly going over my £1500 OD and my credit card was mxed out (I think it was £1250). These were from my student account and I'd been out of uni for a year and not made any start in paying either of them back. The bank offered a managed loan. Now the total amount of the loan was for £2840. They reduce everything to £0 and HSBC actually gave me £200 to credit my account. I don't know if that is standard practice or whatever (the £200 is obviously added onto the loan).

Now the downside of it...

Whilst you have a managed loan, you cannot have a credit card with that bank, they take it off you.

You are not allowed any OD facility.

You can only have a SOLO card.

you cannot apply for loans with that bank (or if you do you will turned down automatically).

This definitely for the period you have the managed loan and I think for maybe 6 months after it's been paid off.

Now the upside (for me anyway)

Unlike a standard loan, where you pay the interest off first then the amount, with the managed loan you pay off the amount then the interest. So the way it was explained to me, if you have a managed loan for £10k, you've already paid off £2k in instalments. Say you won the lottery - you would only have £8k to pay back you wouldn't have to pay the 8k + interest. So if you find you have the money, you can clear it when you want.

The APR on mine is 14.8%. I think she said something like it follows the base rate or something (didn't understand what she was going on about...

)

I know some people think they're a bad idea - I don't know why. But mine really helped me. Mine was going to be over an 8 year period or something ridiculous but now it will all be paid off by Sept 06 - so I will have had it for just over 2 years.

Hope that helped.

Montymoo_2 · 7 April 2006 at 12:37PM

Glitterari wrote:

Hi,

I have a managed loan with HSBC. I've just run upstairs to get some paperwork, to give you some facts and figures...but i'll tell you my experience of it too.

Back in Aug 04, I was in quite a bit of financial difficulty, so I went to the bank for some help. They tried to sort a normal loan for me, but I was refused. I was constantly going over my £1500 OD and my credit card was mxed out (I think it was £1250). These were from my student account and I'd been out of uni for a year and not made any start in paying either of them back. The bank offered a managed loan. Now the total amount of the loan was for £2840. They reduce everything to £0 and HSBC actually gave me £200 to credit my account. I don't know if that is standard practice or whatever (the £200 is obviously added onto the loan).

Now the downside of it...

Whilst you have a managed loan, you cannot have a credit card with that bank, they take it off you.

You are not allowed any OD facility.

You can only have a SOLO card.

you cannot apply for loans with that bank (or if you do you will turned down automatically).

This definitely for the period you have the managed loan and I think for maybe 6 months after it's been paid off.

Now the upside (for me anyway)

Unlike a standard loan, where you pay the interest off first then the amount, with the managed loan you pay off the amount then the interest. So the way it was explained to me, if you have a managed loan for £10k, you've already paid off £2k in instalments. Say you won the lottery - you would only have £8k to pay back you wouldn't have to pay the 8k + interest. So if you find you have the money, you can clear it when you want.

The APR on mine is 14.8%. I think she said something like it follows the base rate or something (didn't understand what she was going on about... )

I know some people think they're a bad idea - I don't know why. But mine really helped me. Mine was going to be over an 8 year period or something ridiculous but now it will all be paid off by Sept 06 - so I will have had it for just over 2 years.

Hope that helped.

Did you do this in branch or over the phone? Im trying to pluck up the courage to ring HSBC at the moment as my JSA isnt enough to cover my graduate loan repayment for this month and i'll miss the may payment as i wont be paid until the 18th from my new job.

Before anyone asks my PPI was rejected

Glitterari · 7 April 2006 at 12:41PM

I went into the branch to go through all my options - the only one I had was the managed loan.

Luckily I had a lovely girl helping me out. It took a few appointments though, as I had to go away and think about it.

Good luck - Carly

lynzpower · 7 April 2006 at 12:42PM

Shouldnt your PPI pay the loan repayment? Or is this what you mean?

Glitterari · 7 April 2006 at 12:43PM

Ummmm - I understand you can cancel PPI...it's supposed to be crap and never pays out anyway...might not help just yet but something to consider?

Carly

Montymoo_2 · 7 April 2006 at 12:45PM

lynzpower wrote:

Shouldnt your PPI pay the loan repayment? Or is this what you mean?

Apparently my claim isnt valid as i left my previous job of my own accord (i moved to the other side of the country with my partner for his job) so they still want payments in full. When i went into my branch to explain the situation the woman said that the best thing i could do would be to speak to the CAB or contact a debt management company

Montymoo_2 · 7 April 2006 at 12:49PM

Glitterari wrote:

Ummmm - I understand you can cancel PPI...it's supposed to be crap and never pays out anyway...might not help just yet but something to consider?

Carly

thats the easiest solution, i cancel my PPI they refund me the 1K ive paid out in PPI, then i have enough to restore my account to within its overdraft limit, pay both installments of the loan and have some money to tide me over until im paid. However i cant see the bank doing this!

Managed Loan

Comments

Confirm your email address to Create Threads and Reply

🚀 Getting Started

Categories

Is this how you want to be seen?

Get our FREE Weekly email full of deals & guides - and it’s spam-free