Intrest Carged on a Debt?

Hyp3rion

Hi people.

Firstly, I would just like to say what a fantastic forum this is for help and info, i only found it by chance and on browsing through the posts its great to see so many people helping each other through tough times.

The reason i post is this:
I have quite alot of debt which is all part of my divorce a few years back and the loss of my house. I have been struggling ever since but have arrangements with several debt companys to pay a set monthly amount.
But 1 debt is bothering me. I had a letter from Cap Quest Debt Recovery for a debt that they had purchased from Royal Bank of Scotland, this is for a credit card i used to have and the balance is just shy of £1600. I have an arrangement to pay £50 per month for the time being. I called them last week to enquire about the balance and it was not as i thought it should be, seems they are charging me 1% intrest per month on this debt so everytime time i pay £50 they are slapping £20 back on the debt.

I didn't know they could do this, i thought debts like this were not subject to intrest, can someone advise please.

Conor_3

THEY ALL DO THIS. They can charge whatever they feel like. They can also charge a monthly administration fee. Baines & Ernst were good at this. Repaying £125 a month could see as little as £20 actually going towards paying off the balance of the debt!!!

This is why you should avoid debt recovery companies like the plague. Their aim is to make as much money off you as possible, not to help you repay your debt as that doesn't earn them money. They do everything they can to prolong the debt as possible.

And they're sneaky barstewards too. They make a big song and dance about the fact they reduce your monthly payment. What they try to hide as much as possible is that you'll be paying it back for DECADES, and yes I DO mean decades..15 years is the usual minimum once you get into several thousands of pounds. They also hide the fact that you'll pay back several times the amount owed.

Take your £1600. You're paying them £50 a month but only £30 off the balance so in effect your monthly payment is £30. So that's going to be about 53 payments - nearly four and a half years. Meanwhile, you'd have paid them £2650. They've made £1000.

To bring this into perspective, if you had put just £20 a week towards this debt, it'd be clear in just over a year and a half.

You need to get out of the control of these debt companies. Contact Payplan and the CCCS. See what they can do.

sparkle84

THEY ALL DO THIS. They can charge whatever they feel like. They can also charge a monthly administration fee. Baines & Ernst were good at this. Repaying £125 a month could see as little as £20 actually going towards paying off the balance of the debt!!!

This is why you should avoid debt recovery companies like the plague. Their aim is to make as much money off you as possible, not to help you repay your debt as that doesn't earn them money. They do everything they can to prolong the debt as possible.

And they're sneaky barstewards too. They make a big song and dance about the fact they reduce your monthly payment. What they try to hide as much as possible is that you'll be paying it back for DECADES, and yes I DO mean decades..15 years is the usual minimum once you get into several thousands of pounds. They also hide the fact that you'll pay back several times the amount owed.

Take your £1600. You're paying them £50 a month but only £30 off the balance so in effect your monthly payment is £30. So that's going to be about 53 payments - nearly four and a half years. Meanwhile, you'd have paid them £2650. They've made £1000.

To bring this into perspective, if you had put just £20 a week towards this debt, it'd be clear in just over a year and a half.

You need to get out of the control of these debt companies. Contact Payplan and the CCCS. See what they can do.

Hi you have misunderstood the question Cap Quest are a Debt Recovery Company not a Debt Management Company however your post re Baines & Ernst and their like is correct.

re the 1% interest I am not 100% sure but I didn't think they could charge interest but hopefully someone with more knowledge then me will be along shortly