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Provident loan arrears?

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dannimaycox
dannimaycox Posts: 57 Forumite
in Loans
Hi, for the past 6 months i've been helping my mum to pay off her provident loan. Her financial circumstances changed and she could no longer afford the repayments. She should have been paying £45 a week but she could only afford £10, her agent came to our house and said it would be fine for her to just pay £10 but it would just take her longer to pay it off. So for about 6-7 weeks she paid £10, but then i said i would help her pay it off so i started giving her £30 a week towards it and she pays £15 so we are paying the full amount. In September last year she owed £1600 and now she owes £430. In november last year she recieved a statement and a letter about arrears, she was £450 in arrears (from when she was paying a reduced amount). She recieved another letter yesterday with her remaining balance on £460 and £430 in arrears. Do the arrears have to be payed back? We were hoping to have the loan payed back by the end of July but if it means the arrears need paying back we're going to struggle to pay it off by christmas. Does anybody know?
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  • tattoed_bum
    tattoed_bum Posts: 1,189 Forumite
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    yes the arrears have to be paid back
  • dannimaycox
    dannimaycox Posts: 57 Forumite
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    Urgh, i cant beleive it, when the agent came around last year he never said that she would get into arrears by not paying the full amount!
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  • 27col
    27col Posts: 6,554 Forumite
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    arrears - definition of arrears by the Free Online Dictionary ...

    An unpaid, overdue debt or an unfulfilled obligation. 2. The state of being behind in fulfilling obligations: an account in arrears. ...
    How could you possibly think that by not paying the full repayments due, you would not be liable to pay the arrears.
    I can afford anything that I want.
    Just so long as I don't want much.
  • dannimaycox
    dannimaycox Posts: 57 Forumite
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    The agent made it clear to my mum that she could pay at a reduced rate but it would just take her longer to pay off. He never said that she would end up with more to pay! The balance is due to be paid in July, what will happen then will we have to continue paying until the arrears are gone?
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  • dannimaycox
    dannimaycox Posts: 57 Forumite
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    From the Provident website:

    1. Are there any extra charges?
      • The simple answer is no.

        Unlike many high street banks and credit card companies, we do not charge for missed payments or overdraft facilities.

        At Provident we pride ourselves on being friendly and straightforward, and on having no extra charges, even if you miss a payment.


    We haven't missed any payments, we just paid at a reduced rate for a few weeks. Confused :S
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  • adea
    adea Posts: 448 Forumite
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    When you take out a loan from Provident, the amount you repay per week is what would pay the balance off in the set agreement time.
    For example, if you took out a loan for a term of 105 weeks at £35 per week, then if you pay the £35 per week throughout the loan period, then it will be paid off in 105 weeks.
    If you don't pay £35 but only pay £10 per week for the next 7 weeks, then each time you pay the account falls into arrears by £25 as you have not paid enough to get the loan paid off in the duration stated (105 weeks), you will be left with arrears, in this case £175.
    Hope this help a little.
  • Emmzi
    Emmzi Posts: 8,658 Forumite
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    by arrears, do they just mean "the bits she didn't pay the weeks she didn't pay in full, added up"

    or do they mean "Those bits, plus some extra interest and charges"

    If you could get a full statement from them, and post it here, we can help; but the information is a bit vague to be sure at the moment.
    Debt free 4th April 2007.
    New house. Bigger mortgage. MFWB after I have my buffer cash in place.
  • dannimaycox
    dannimaycox Posts: 57 Forumite
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    So how will we have to pay the arrears back? Once the original loan is payed back (at the end of July) if we continue making payments will the arrears then go down?
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  • adea
    adea Posts: 448 Forumite
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    Emmzi wrote: »
    by arrears, do they just mean "the bits she didn't pay the weeks she didn't pay in full, added up"

    or do they mean "Those bits, plus some extra interest and charges"


    The arrears that the OP mentions would be from when she didn't pay the full amount. Provident don't add any extra interest or charges.
  • Emmzi
    Emmzi Posts: 8,658 Forumite
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    danni, yes, if you keep paying, the arrears reduce
    Debt free 4th April 2007.
    New house. Bigger mortgage. MFWB after I have my buffer cash in place.
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