FirstPlus interest rates - again

sickoffirstplus

July 05 -agreement signed 8.59% apr
misplaced any changes advised between start and Dec 06
Dec 06 - 9.4% apr
Feb 07 - 9.7% apr
April 07 - 10.2% apr
July 07 - 10.5% apr
Jan 08 - 10.8% apr
Mar 08 - 9.7% apr
May 08 - 10.2% apr
Aug 08 - 10.5% apr

TwinsMum_2

I am unable to find all my interest increase notices but I do know that at one point they went up even though the interest rate didn't. Their reason being the current market circumstances. After I succesfully claimed back my PPI they went up 4 times over the next few months even though the interest rate onoccasions never changed. Surely they can't just invent their own interest rate to suit them. The interest rate has now dropped alot yet no change to our rates WRONG WRONG WRONG. So my payments are know creeping up to where they were before the PPI came off

Welshdresser

Hi 'sickoffirstplus' (aren't we all!) and twins mum. Thanks for your replies

Twins mum - what grounds did you use to get your PPI back and did they try to fob you off, or just agree straight away? I'm currently awaiting a response from them about my claim and its useful to see how others were successful.

Cheers all, Aly

TwinsMum_2

Hi there, I had to go to FO as FirstPlus told me no straight away, I claimed because I never felt that they explained everything properly to me and the FO agreed. It did take along time though almost 9 months but they were very sure I had no chance but I won in the end, so you must keep going.

golf18

Hi All,
Just rang First plus and asked if there was any plans to reduce the rate standard reply will notify 14 days prior to any change. Also checked my rate being 9.3% increased by o.3% in August 2008, loan taken out at 7,7%.

Also wondering if I should chase for PPI mis selling as it appeared to be a condition of the loan being accepted. I will get £25,000 back after 5 years with no claim made. Loan taken out in March 06 PPI underwritten by Barclay's Insurance Dublin.

Advise appreciated

marshallka

golf18 wrote: »

Hi All,
Just rang First plus and asked if there was any plans to reduce the rate standard reply will notify 14 days prior to any change. Also checked my rate being 9.3% increased by o.3% in August 2008, loan taken out at 7,7%.

Also wondering if I should chase for PPI mis selling as it appeared to be a condition of the loan being accepted. I will get £25,000 back after 5 years with no claim made. Loan taken out in March 06 PPI underwritten by Barclay's Insurance Dublin.

Advise appreciated

Yes if you had no choice, join the PPI reclaiming discussion thread and also was it Firstplus that actually sold you the PPI or did you use a broker??

Just take a look at the link here and see what you can add and delete from the template letter. Its always best to do your own from this. There are lots of reason on there for the misselling so pick out the ones that are applicable to yours.

You then write to the firm that actually made the sale of the PPI to you if this is different from the lender and don't forget to send this recorded delivery so you always a proof and dates etc.

After that you have to give them 8 weeks for a full and final response. In this time it is usual to get a response of "sorry we sold this to you fairly" but you then respond to this and reiterate your complaint again. The next time they write they either give you a final response which you would need in order to take this complaint to the FOS or offer to settle.

http://www.moneysavingexpert.com/rec...urance#reclaim


Good luck

halifax71

Just an update - i've finally got round to writing to FP. Here's a copy of the letter with the issues i've raised. Anyone think of any more? Happy New Year all.

I write with reference to the secured loan that I took out with Barclays First Plus in January 2006.

I have, with concern, noted the increase to the APR applied to my loan over the 3 years since its inception and more recently have awaited confirmation of a decrease in the APR to reflect current market conditions. In the absence of any communications from you in this regard I would appreciate your answers to the questions detailed below (in bold).

Over the 3 years of the loan you have increased the APR 7 times (and decreased once). The APR when I took out the loan was 8.4%. This corresponded to a Bank of England rate of 4.5% and a 3 month LiBOR of 4.59%. My current APR is 10% with a corresponding Bank of England rate of 2% and 3 month LiBOR of 3.24% - as at 10th December. The loan was sold to me with a “Variable” APR. I note in my terms and conditions that you refer to the FHBR. This was 5% at loan inception and currently stands at 4.0%.

The potential future disparity between the BoE rate / Libor (how I define market conditions) / FHBR and my APR was not explained to me. I fully expected my interest rate to be aligned to the BOE / LiBOR / FHB rate changes.

Using the FHBR as the base the APR on my account would be 7.4% - reducing my payments by £93 a month.

My terms and conditions are at best unclear.

• Yes, it does clearly state that interest rates can increase & decrease (I know this).
• It does say that they will change for other reasons, e.g. competitiveness. However as Barclays FirstPlus have closed their doors to new customers the competitiveness angle is no longer relevant. I suggest to you that Barclays FirstPlus customers are being used as a cash cow to support Barclays businesses that are still subject to competition.
• Condition 7 states “We may increase or reduce our interest rate to reflect a change which has occurred, or which we reasonably expect to occur in interest rates generally..”. This infers a link to interest rates.
• Other reasons stated in condition 7 include prudence & efficiency. As with competitiveness these are no longer relevant.

The term “variable” was used by your salesperson. However there was no explanation of how the APR could be amended in complete contrast to market conditions. It is my belief that you are using the term “variable” unfairly and you did not fully explain to me the implications of taking out such a loan.

It is also my contention that your actions, i.e. enforcing a higher APR than could be reasonably expected, raises the question as to whether the loan agreement is compliant with the Unfair Terms in Consumer Contracts Regulations 1999. I question this as the current situation “Causes significant imbalance", in that it is to the detriment of the consumer, i.e. me, and benefits the seller or supplier, i.e. Barclays FirstPlus, to an excessive degree.

Question 1 – as I understand you retain copies of the telephone sales process, do you believe that the salesperson made me fully aware of the possible APR rises, e.g. where they are not linked to BoE rates, LiBOR or FHBR? Please provide transcript evidence to support any justification.

Your loan literature defines the term “variable” as “The interest rate on your loan is variable. This simply means that your rate could go up or down in line with market conditions.” Source – Your website.

As I stated above the terms and conditions are at best unclear – in my opinion they are intentionally vague.

Question 2 – do you believe that the terms and conditions of the loan clearly and accurately detail the fluctuations that could occur in the APR? Please fully explain any justification.

Question 3 – can you fully explain how the term “in line with market conditions” is supposed to be interpreted?

The 35 repayments made to date have all been made by Direct Debit. I haven't missed or been late with a payment hence my risk is probably better than it was at the loan inception. The only conclusion I can draw is that the underlying risk of others defaulting is being used as justification for hiking my APR.

Question 4 - Is the current 10% APR on my loan a fair reflection of a change in the underlying lending risk?

I am assuming there is a record of the basis for providing me with the loan at 8.4% APR.

Question 5 – Can you please provide a full explanation of the basis for the 8.4% APR at loan inception? If there is not a record please provide an explanation of how it was arrived at anyhow.

My APR was amended in April 07 from 9.2% to 9.7% as a direct result of a FHBR increase (source – your letter). It was then reduced in March 08 due to “market conditions” (source – your letter). The FHBR in April 07 & March 08 was 6%.

Question 6 – Can you please explain how condition 7 of my loan works in practice, specifically the variance against FHBR in any 12 month period?

Question 7 – Can you please reiterate the justification for the 8 changes to APR since the inception of the loan? As these have been in line with BoE / LiBOR / FHBR changes I assume there is another reason due to your current failure to pass on rate reductions.

Question 8 – following on from question 5 please explain what has changed in order to arrive at the current variation from BoE / LiBOR / FHBR?

You provided a loan to me using an industry understood term – “variable”. It is my contention that Barclays First Plus is using the term “variable” unfairly. Please provide a detailed response to the question raised and give due consideration to realigning my APR with market conditions. I will, depending on your response, pass my file to the Financial Ombudsman for a ruling.

JudiBee123

Welshdresser wrote: »

Hi everyone...

I have a thread running in Moneysupermarket.com regarding FP's refusal to cut interest rates. There is a great member there who is using his financial expertise to see if we have a solid case to take to the OFT about their practices. He needs to have details from other FP customers about their interest rate changes over the last few years to compare and see their rate increases have been fair and consistent across all of their customers, or if they just tinker with individual customers as they feel like it - which is the perception I and other members have.

If anyone is prepared to back through their loan and list the date of every increase it would be really helpful. You could list them here or go to the other forum which is in: Moneysupermarket.com - go to forum - money & finance - loans - and the thread is 'interest on secured variable rate loan'. (Sorry i'm not great at posting a link).

My interest increases are as follows:
Sept 06 - agreement signed APR 7.7%
Dec 06 - increase to 8.2%
Feb 07 - increase to 8.5%
April 07 - increase to 9%
July 07 Increase to 9.3%
March 08 - decrease to 8.5%
August 08 - increase to 9.3%
Don't pay for the information, If you haven't got all the letters from FP, you may be able to see where your rates increased from your bank statements.

I really hope to hear from you all - there is strength in numbers!!
Aly

Hi - just been going though the website in relation to my FP loan and hope to be able to get things on the go to claim some monies back for my PPI. Meanwhile I notice that I seem to be paying 2% more than you on interest all the way down the line - interesting to see their interpretation of "variable" .... For your information and use as you feel fit:

Loan signed in Feb 2005 - 7.9%
Dec '06 increase 8.4%
Feb '07 increase 8.7%
April '07 increase 9.2%
July '07 increase 9.5%
March '08 decrease 8.7%
May '08 increase 9.2%
Aug '08 increase 9.5%

Regards
JudiBee

m.dowsett

Hi,
I have complained to the ombudsmen regards the unfair contract terms with firstplus. The agreement suggested that my rate should follow banking trends generally, it clearly does not.
The F/O ruled that F/P are entitled to charge what they like, now I have written to the office of fair trading whom are trying to find their licence to issue credit.
Ultimatly one or all of us will have to get this company [Barclays] in court, this will be the only way for justice to prevail.
I shall wait for the five year period befor trying to claim my ppi back [per agreement]
This company will eventually learn they need to take less or end up in many cases with nothing, although im suprised Barclays are so slow to realise this.

halifax71

Hi - what grounds did you use to complain to the FO? Were any of them similar to mine detailed above?

What did the FO say in judgement? Any chance you can copy on here?

Sorry to ask but we need to know as much as possible about what the FO are thinking about FP.