Help!!!! Is This Unfair???

Lizardking - A very moot point this. After a debt-related suicide, the Banks come out all pink and fluffy and claim that they always try and help and take seriously any debt problems. Reality is that they can make it very difficult, and don't give honest, helpful advice. If you don't feel up to handling it on your own, you could try the Citizens Advice, but basically the routine is-
You contact them with statement of income and expenditure.
Normally, the account has to go to default before they will consider any reduced payment plan - Think hard on this, as it does adversely affect your credit rating for a few years.
This is where it gets messy, some Banks are good and do it relatively painlessly, others bombard you with endless phone calls demanding money with menaces, and others just ignore your request - RBS are one of the few I have not dealt with, so can't say about them.
I found that most Banks eventually played ball, some froze interest, others reduced it, some offered interest free loans (Best solution, you pay off the debt, they don't have to manage it), others had 'regular reviews' after 3, 6, 12 Months (A pain), and most had a random period when you suddenly have to start paying interest and repayments double, and all discussions are met with a curt 'It's the rules'.

If you can get a personal loan, that might be a better option, reducing payments, and keeping your credit cleaner. Good luck, and if you do try the reduced payment route, I hope that RBS are one of the good Banks and try and help you through this.

Ah, I understand now. I am making a similar claim against Sainsburys Bank, each time I pay in a sum of cash, my limit reduces. There are other service issues, but in my claim to the Ombudsman, I have argued that the credit card interest rate reflects the convenience and flexibility of a revolving credit agreement, but by making it repayment only, it should be charged at loan rates. I suspect I will get rejected as there is bound to be something in the T&C's, and I borrowed the money at the card rate, so that is what I have to pay back, but you never know. I really think that the credit card companies are using very underhand tactics, and basically shafting the customers as they suddenly transform into 'responsible lenders'. In reality they are desperate to reduce bad debts, but instead of trying to come to a mutual agreement, they still want every penny that they can grab.
My personal opinion, which many on here disagree with, is that by withdrawing the facility, they are changing the terms of borrowing, and should offer a low rate loan for repayment. They lent the money, this is being done for their benefit, so why should the customer be penalised? You have the option of the formal complaints procedure, and ultimately the Ombudsman - And if it goes there, it costs RBS £450, so that could be a good lever in the negotiations. If you feel they should let you repay at 0%, go ahead, fight them, don't bother with the call centres, just do the 'Final Complaint', then if appropriate, you can go to the Ombudsman - Let's face it, you cannot end up in a worse position than now, whatever the outcome.
In my case, I took out a loan at an excellent rate elsewhere, purely so that Sainsburys get no more interest out of me. Not sure on your credit rating, but I can get up to £15K on an unsecured loan with no questions asked, and yet a few Months ago, I was declined by the ultra-unfussy Vanquis for a credit card!
BTW, have you had any late fees/ overlimit fees in the last 6 years? If so, check out on the Forum about reclaiming these. That might help repay the debt a bit quicker. Hope that this has been of use, and good luck.

You pay interest on what you owe them, you dont pay interest because you have a credit card facility available to you. Essentially what you have now is a loan, which you would expect to have to pay interest on.

Dylanwing wrote: »

and ultimately the Ombudsman - And if it goes there, it costs RBS £450, so that could be a good lever in the negotiations.

This is factually incorrect. It would cost them somewhere in the region of £450 if the ombudsman decided the complaint was a valid one and warranted taking further.
As this would be a complaint that the OP simply doesnt want to pay interest on money they have borrowed - as is the case for all financial institutions the world over then it wouldnt cost the bank anything and the ombudsman would probably dismiss the complaint at first stage.

If you dont agree with paying interest, dont borrow someone elses money, simple.

I think my point may have been mis-understood. My point is that the credit card rates of around 15% - 20% relate to a revolving credit facility. As this is withdrawn, it effectively becomes an usecured loan, and therefore the Bank headline unsecured loan rate should apply to the outstanding balance. As I have argued elsewhere, of the facility is withdrawn because of a new 'responsible lending' policy, does this mean that the Bank is admitting that it has lent irresponsibly? It will be to the benefit of both OP and the Bank if the debt is repaid quickly and painlessly, and in my opinion, this would be better achieved by way of a loan at reasonable rates, rather than the CC interest rates. I totally agree with you that 0% may be a step too far though.