Libor loans & complaints

I have recently become aware that loans linked to the libor rate may have been unfairly sold and there is a chance of compensation from the banks, would it be possible to have a section devoted to this please so that those of us that have been unfairly treated can swap notes.
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Comments

  • JuicyJesus
    JuicyJesus Posts: 3,829
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    It's not really unfair treatment. You signed up for a loan that tracks LIBOR, end of.

    Also, in many cases LIBOR was depressed artificially. This means that those with LIBOR loans would actually have benefited financially from the manipulation. Following standard redress rules, you may well either break even or actually owe more money to the bank.
    urs sinserly,
    ~~joosy jeezus~~
  • Wutang_2
    Wutang_2 Posts: 2,513 Forumite
    jamie11 wrote: »
    I have recently become aware that loans linked to the libor rate may have been unfairly sold and there is a chance of compensation from the banks, would it be possible to have a section devoted to this please so that those of us that have been unfairly treated can swap notes.

    Your signature is so sexist I also now crave some unobtainable desperate compo too!!:D:D:D:D:D
    Hi, we’ve had to remove your signature. If you’re not sure why please read the forum rules or email the forum team if you’re still unsure - MSE ForumTeam
  • LIBOR may have been manipulated but it was not unfairly sold. You took out a mortgage/loan, having no doubt thoroughly researched the best deal. For every post that gets my sympathy on this forum there are 10 that do not. On the positive side, there's probably a loose paving stone somewhere on the way to work tomorrow...
  • ~Brock~
    ~Brock~ Posts: 1,710
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    On the positive side, there's probably a loose paving stone somewhere on the way to work tomorrow...

    ....and if not then take a detour through the park and walk under as many trees as possible, especially if it's windy at the time...you never know you might get lucky! :money:
  • jamie11
    jamie11 Posts: 4,436 Forumite
    OK, it seems none of you know what I'm talking about. Instead of libor call it a 'swap loan'. Watch the news for mention of them because they are going to be big news soon just as the PPI scandal was and is.
  • antrobus
    antrobus Posts: 17,386 Forumite
    jamie11 wrote: »
    OK, it seems none of you know what I'm talking about. Instead of libor call it a 'swap loan'. Watch the news for mention of them because they are going to be big news soon just as the PPI scandal was and is.

    I'd strongly suggest that it is you that doesn't know the difference between a libor linked loan and an interest rate swap. In your OP you referred to "loans linked to the libor rate" so of course no one else has the faintest idea that you meant something else entirely different.

    P.S. What is thread doing in 'Site Feedback'??
  • robrooo
    robrooo Posts: 72 Forumite
    Didn't this story break in the Summer? Basically small to medium-sized businesses who wanted a loan from their bank were told they had also to take out a hedging swap (sometimes with a cap or collar) to protect themselves from interest rate changes.

    Generally this type of instrument has a fixed interest leg and a variable leg, linked to LIBOR. The LIBOR flows cancel out the variable loan rate and leave you with a fixed rate loan. The cap and collar adds trigger rates at which the hedge rate comes into force.

    But of course you pay a premium for the privilege of buying the swap/cap/collar, and maybe the rate that you "bought" was not as good as the natural rate you might have got with no hedge, especially as interest rates have been very low for some time.

    There were also allegations that the hedge amount was often inflated compared to the loan; that clauses in the swap agreement allowed the bank to cancel the hedge at any time, but not the borrower; that the period of hedging was longer than the lifetime of the loan; thus the allegations of mis-selling.
    antrobus wrote: »
    P.S. What is thread doing in 'Site Feedback'??

    Indeed!
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  • _Andy_
    _Andy_ Posts: 11,150 Forumite
    jamie11 wrote: »
    OK, it seems none of you know what I'm talking about. Instead of libor call it a 'swap loan'. Watch the news for mention of them because they are going to be big news soon just as the PPI scandal was and is.

    So, given that you're clearly the authority on the matter, why are you bothering posting here?
  • Wywth
    Wywth Posts: 5,079 Forumite
    antrobus wrote: »
    P.S. What is thread doing in 'Site Feedback'??
    robrooo wrote: »
    antrobus wrote: »
    P.S. What is thread doing in 'Site Feedback'??
    Indeed!

    Where would you two suggest the OP posts a thread requesting a new board? :huh:
  • antrobus
    antrobus Posts: 17,386 Forumite
    Wywth wrote: »
    Where would you two suggest the OP posts a thread requesting a new board? :huh:

    So you think when OP is referring to the possibility of having "a section" devoted to "loans linked to the libor rate" they're requesting a new board? :huh:

    Got to be a candidate for the most misleading post of the year award.
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