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  • FIRST POST
    • Rallygoer
    • By Rallygoer 6th Sep 17, 6:45 PM
    • 1Posts
    • 1Thanks
    Rallygoer
    LLoyds Bank Interest Charges Scam
    • #1
    • 6th Sep 17, 6:45 PM
    LLoyds Bank Interest Charges Scam 6th Sep 17 at 6:45 PM
    Last month I inadvertantly forgot to transfer funds to my account which the mortgage is taken out of.
    To which I would firstly say Nationwide seem to not have a policy of informing you that you may go overdrawn on one acount, even if there is significantly more funds in another Nationwide account to cover it.

    However, it happened, and was my own fault!

    The subsequent letter from LLoyds Banking group dated 2 days after the payment should have been made, detailing my mortgage payment request had been returned unpaid, duely arrive another 2 days after the date of the letter.
    It may or may not be of consequence, but the letter was dated 17th and it arrived on the 19th.
    The second paragraph of the letter, as if to highlight it was:

    There is no need for you to take any action at this time. The request will be represented to you bank in 10 working days time. Please ensure there is sufficient fund in your account.

    With this I immediately transfered funds to cover everthing on the same day the letter arrived.
    The payment should have been taken on 15th, but was finally taken on the 30th.

    I received the second letter from LLoyds Banking Group Collection department informing me that my account was in arrears dated 30th, the same day that Lloyds Banking took their payment.

    When I contacted the bank to question this, knowing that the payment had been made on the due date that they said they would be taking it, I was told "The collections department automatically send out this letter 10 working days after the first payment is returned". To which my argument was how can it possibly be that the second letter is sent out on exactly the same day as the re-resentation occurs?

    After a somewhat lengthly "discussion" I was also informed " well actually sir you account went into arrears on the same day your payment was not made"!

    The first letter, as if to indicate you need do nothing there is not a problem prints the bold part just to let you know that nothing is happening, but in fact is the scam by which they start to cream off a tidy little sum of the poor unsuspecting customer.

    If there had been some notification in the bold print stating "YOU WILL BE CHARGED INTEREST FOR ALL THE TIME YOU ACCOUNT IS IN ARREARS" I would also have made arrangements for the mortgate payment to have been made immediately, but was lured into this false sense of security by the "you need do nothing.....".

    Make not you will be charged interest of 30% PA or 0.082% per day on all outstanding monies. As I overpay my mortgate it only amouted to some £3 but could have been much higher.

    So the moral is, as I think I have seen elsewhere on this site, banks deliberately do nothing so that they can charge you for YOU not doing something, or, alternatively will mislead you in order to get more money out of you for YOU not doing something.

    I was more concerned about marks on my perfect credit reference more than the charges (which afterwards were resolved amicably), and this is the big one, if your mortgage payment is taken on a date such that the second time they try to take the payment falls in the next month, YOU WILL GET A BAD MARK AGAINST YOUR CREDIT SCORE!
    So if at all possible get your payments take out in the first half of the month as 10 working days could be as long as 15 days if there is a bank holiday ss well as 2 weekends.
Page 1
    • Edi81
    • By Edi81 6th Sep 17, 6:53 PM
    • 274 Posts
    • 160 Thanks
    Edi81
    • #2
    • 6th Sep 17, 6:53 PM
    • #2
    • 6th Sep 17, 6:53 PM
    Or even easier. Have a standing order to find your account a couple of days before the payment is due.
    • Thrugelmir
    • By Thrugelmir 6th Sep 17, 7:12 PM
    • 55,160 Posts
    • 48,361 Thanks
    Thrugelmir
    • #3
    • 6th Sep 17, 7:12 PM
    • #3
    • 6th Sep 17, 7:12 PM
    To which I would firstly say Nationwide seem to not have a policy of informing you that you may go overdrawn on one acount, even if there is significantly more funds in another Nationwide account to cover it.
    Originally posted by Rallygoer
    Not the banks job to micro manage your account. If you want a private banking service be prepared to pay for it. As a personal account handler won't come cheap.
    “ “Bull markets are born on pessimism, grow on skepticism, mature on optimism, and die on euphoria. The time of maximum pessimism is the best time to buy, and the time of maximum optimism is the best time to sell.” Sir John Marks Templeton
    • dunstonh
    • By dunstonh 6th Sep 17, 8:03 PM
    • 89,468 Posts
    • 54,938 Thanks
    dunstonh
    • #4
    • 6th Sep 17, 8:03 PM
    • #4
    • 6th Sep 17, 8:03 PM
    LLoyds Bank Interest Charges Scam
    as usual, when someone says scam, its not.
    After a somewhat lengthly "discussion" I was also informed " well actually sir you account went into arrears on the same day your payment was not made"!
    Which is correct. However, they always give a margin of time to allow for weekends, bank holidays and clearing cycle. A payment date of 1st monthly may not be confirmed unpaid until around the 8th. Yours was earlier than that but not all would be.

    If there had been some notification in the bold print stating "YOU WILL BE CHARGED INTEREST FOR ALL THE TIME YOU ACCOUNT IS IN ARREARS" I would also have made arrangements for the mortgate payment to have been made immediately, but was lured into this false sense of security by the "you need do nothing.....".
    You pay interest on your balance. Your balance didnt reduce. So, why did you think you would pay less interest? Common sense should not be replaced with you being spoon fed the obvious.

    So the moral is, as I think I have seen elsewhere on this site, banks deliberately do nothing so that they can charge you for YOU not doing something, or, alternatively will mislead you in order to get more money out of you for YOU not doing something.
    The moral is that you should act like an adult and take responsibility for your own actions and your own failures.

    I was more concerned about marks on my perfect credit reference more than the charges (which afterwards were resolved amicably), and this is the big one, if your mortgage payment is taken on a date such that the second time they try to take the payment falls in the next month, YOU WILL GET A BAD MARK AGAINST YOUR CREDIT SCORE!
    And so you should. If you cannot control your finances to ensure your mortgage is paid then you deserve the bad mark on your credit score. A credit score is not just about the ability to repay but the responsibility to repay.

    Sorry. I have no sympathy as you failed to take responsibility for your own failures and then try to accuse the bank of running a scam because you don't understand that you pay interest on money you borrow.
    Last edited by dunstonh; 07-09-2017 at 3:27 PM.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
    • Farmerbob
    • By Farmerbob 6th Sep 17, 8:16 PM
    • 142 Posts
    • 85 Thanks
    Farmerbob
    • #5
    • 6th Sep 17, 8:16 PM
    • #5
    • 6th Sep 17, 8:16 PM
    I think you'll find this with a few mortgage landers, your lucky you were not charged a flat fee for bouncing a direct debit so you've been let of lightly.

    There's nothing untoward with the timings of the direct debit as it's not an instantaneous process, the send off the request a few days before the due date then they take a few days to get acknowledgement of any rejects then to resubmit it again takes a few days.

    Your final point is very misleading, missed payments do not become reportable or technical arrears until a month (30 days usually) after the payment is due the fact it falls into the following month has no bearing on it and up until then do not put a mark on your credit file.
    • amnblog
    • By amnblog 7th Sep 17, 7:06 AM
    • 9,744 Posts
    • 3,761 Thanks
    amnblog
    • #6
    • 7th Sep 17, 7:06 AM
    • #6
    • 7th Sep 17, 7:06 AM
    Transferring funds just in time to pay a DDM is a risky business, particularly if the transfer relies on manual intervention.

    Computer systems are not interested in the semantics. They are built to handle hundreds of thousands of cases that do not get paid.
    I am a Mortgage Broker

    You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
    • csgohan4
    • By csgohan4 7th Sep 17, 7:46 AM
    • 3,766 Posts
    • 2,351 Thanks
    csgohan4
    • #7
    • 7th Sep 17, 7:46 AM
    • #7
    • 7th Sep 17, 7:46 AM
    are you sure you can afford the house? perhaps you stretched yourself when you bought the house, perhaps too much?


    You got to pay interest and charges like anyone else who pays late. Chalk it off to an expensive lesson
    "It is prudent when shopping for something important, not to limit yourself to Pound land"
    • RADDERS
    • By RADDERS 7th Sep 17, 8:56 AM
    • 147 Posts
    • 131 Thanks
    RADDERS
    • #8
    • 7th Sep 17, 8:56 AM
    • #8
    • 7th Sep 17, 8:56 AM
    I think you'll find this with a few mortgage landers, your lucky you were not charged a flat fee for bouncing a direct debit so you've been let of lightly.

    There's nothing untoward with the timings of the direct debit as it's not an instantaneous process, the send off the request a few days before the due date then they take a few days to get acknowledgement of any rejects then to resubmit it again takes a few days.

    Your final point is very misleading, missed payments do not become reportable or technical arrears until a month (30 days usually) after the payment is due the fact it falls into the following month has no bearing on it and up until then do not put a mark on your credit file.
    Originally posted by Farmerbob
    That is incorrect, some Building Socoeties report to the credit agencies after the month end, normally a computer program is run and if your account is more than one months payment in arrears you are added to the file to be reported.
    They use the date of payment due as the last day of the month, which is why we used to tell customers who paid by standing order to allow a few extra days for bank holidays, weekends and February.
    • getmore4less
    • By getmore4less 7th Sep 17, 3:13 PM
    • 29,775 Posts
    • 17,803 Thanks
    getmore4less
    • #9
    • 7th Sep 17, 3:13 PM
    • #9
    • 7th Sep 17, 3:13 PM
    Breaking news

    If you don't make your payment they still charge interest on the money you have not paid.
    • fewcloudy
    • By fewcloudy 7th Sep 17, 3:39 PM
    • 157 Posts
    • 78 Thanks
    fewcloudy
    So the moral is, as I think I have seen elsewhere on this site, banks deliberately do nothing so that they can charge you for YOU not doing something, or, alternatively will mislead you in order to get more money out of you for YOU not doing something.....
    Originally posted by Rallygoer

    (I'm not sure 'moral' is the right word btw).

    But anyway, assuming your entire post isn't a sick joke, why should the bank do anything in this situation? If you fail to pay your mortgage then you must know you will pay interest on the money you still owe. Doesn't sound to me like a scam at all.
    Feb 2008, 20year tracker with Sprogget and Sylvester, 0.5% + base for 2 years, then 0.99% + base for life of mortgage. Kudos to my mortgage broker...
    • ManAtHome
    • By ManAtHome 7th Sep 17, 6:01 PM
    • 8,168 Posts
    • 5,300 Thanks
    ManAtHome
    Bit late now, but you can set up (free) SMS alerts on the Nationwide Flex to send a mini-statement on a specific date and/or inform you if not enough money in the account to service a DD/SO/Transfer.
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