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High Court Ruling On Compound Interest

MSE_Martin Posts: 8,272 Money Saving Expert

12 June 2007 at 9:14PM in Reclaim bank & credit card charges

I've heard today from a reliable source (not had time to check it out - but this is someone in the know). That a precedent setting case was decided by the high court today on claiming 'compound interest' on bank charges.

This doesn't effect claiming statutory interest as the article states - and has limited baring. I will delete the following paragraph from the article:

"While the calculator is based on ‘statutory interest’, some people do suggest trying to claim ‘contractual interest’, i.e. the interest rate the bank charges you for lending, which compounds the interest over time (see how interest rates work article).

They argue that it applies as this agreement is reciprocal. It may be worth a shot, but you’re more likely to be awarded the statutory amount, hence the calculator and template letters all assume you’re claiming this."

How can a court decide a precedent case?

If you're wondering how there can be a precedent case and whether it impacts the whole of reclaiming - the answers no. The bank had already paid in full - the decision purely impacts the claiming of compound interest, not on the rights and wrongs as claiming as a whole

Martin

Martin Lewis, Money Saving Expert.
Please note, answers don't constitute financial advice, it is based on generalised journalistic research. Always ensure any decision is made with regards to your own individual circumstance.

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High Court Ruling On Compound Interest

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