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    • rollo321
    • By rollo321 26th May 16, 1:58 PM
    • 3Posts
    • 0Thanks
    rollo321
    Unlawful Penalty Charges
    • #1
    • 26th May 16, 1:58 PM
    Unlawful Penalty Charges 26th May 16 at 1:58 PM
    Hi there,

    Apologies if this has already been answered somewhere, but I'm hoping someone can point me towards where I can read more on unlawful penalty charges on loans and credit cards? The only information I can seem to find relates to payday lenders.

    To summarise; when I was 18 I did the stupid thing of getting credit and not paying it back. 2 credit cards were defaulted with balances of about £300 each, and similarly a loan of approximately £1600 remaining balance.

    The credit cards have since been satisfied however the default balances of £440 and £490; an increase of £140 and £190.

    The loan was for £2000 originally; as mentioned the remaining balance was approximately £1600; however by the time it was passed to Capquest the total repayable is £3770, an increase of over £2000.

    Can anyone let me know if these increases are considered lawful, and if not point me in the direction of some reading and guidance on how to get the unlawful component written off or how to complain about them?

    Really grateful, thanks.
Page 1
    • Gazzafatcityboy
    • By Gazzafatcityboy 26th May 16, 2:06 PM
    • 72 Posts
    • 63 Thanks
    Gazzafatcityboy
    • #2
    • 26th May 16, 2:06 PM
    • #2
    • 26th May 16, 2:06 PM
    what was the increase for?
    • rollo321
    • By rollo321 26th May 16, 2:08 PM
    • 3 Posts
    • 0 Thanks
    rollo321
    • #3
    • 26th May 16, 2:08 PM
    • #3
    • 26th May 16, 2:08 PM
    I genuinely don't know; I'm presuming it was default/late payment fees. It's just that the amount of fees and additional charges is about 50% of the balance.
    • antrobus
    • By antrobus 26th May 16, 2:24 PM
    • 15,128 Posts
    • 21,480 Thanks
    antrobus
    • #4
    • 26th May 16, 2:24 PM
    • #4
    • 26th May 16, 2:24 PM
    I genuinely don't know; I'm presuming it was default/late payment fees. It's just that the amount of fees and additional charges is about 50% of the balance.
    Originally posted by rollo321
    You're going to have to find out.

    Don't forget that interest will be factor. If you have a credit card with a balance of £300 and an APR of 30% it will easily turn into a debt of £450 if you don't make payments for 18 months.
  • National Debtline
    • #5
    • 26th May 16, 2:53 PM
    • #5
    • 26th May 16, 2:53 PM
    Hi

    A good place to start is requesting a full statement of the account so that you can see exactly what the increases were for. As antrobus says, it may simply be interest accruing on the debts.

    On the subject of adding fees for debt collection the Consumer Credit Sourcebook says:

    CONC 7.7.2R01/04/2014
    A firm must not claim the costs of recovering a debt from a customer if it has no contractual right to claim such costs.
    www.handbook.fca.org.uk/handbook/CONC/7/7.html

    In terms of complaining, you would need to make a written complaint to the debt collection agency initially and then escalate it to the Financial Ombudsman Service (FOS).

    James
    @natdebtline
    We work as money advisers for National Debtline and have specific permission from MSE to post to try to help those in debt. Read more information on National Debtline in MSE's Debt Problems: What to do and where to get help guide. If you find you're struggling with debt and need further help try our online advice tool My Money Steps
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