HSBC Graduate Persoanl Loan Settlement

shazzer22

I foolishly took out a consolidation loan with HSBC last August £16k over 8 yrs meaning I'd repay nearly £27k!

Fortunatey for me a friend has just come into a nice large some of money and has loaned me £20k to pay off my debts (see other thread)

I called HSBC to get a settlement figure and recieved the following:

Thank you for your request for a settlement figure in respect of account number XXXX. I am pleased to advise you of the follwoing details. which apply, provided payment is recieved in full by the settlement date of 2 April 2006.

Outstanding balance 25676.28
Less rebate of interest 5413.24
Total outstanding net of rebate interest 20263.04
less refund of insurance premium 4076.10
settlement fugure 16186.94

the settlement figure above is the amount you must pay to settle this agreement. payment must be recieved by us on or before the settlement date shown above. Please note, you should continue to make your regular monthly payments as they fall due prior to the setllement date. You may deduct these payments from the settlement figure when you pay.

Payment may be made at your local branch or by completely the enclosed authority form.......etc


Now I went down to my local branch yesterday afternoon, asking to settle, with my letter. I was informed my new settlement figure was 15921.93. I have made a payment of 305.67 on the 3rd of March therefore according to my letter I should deduct the figure from my settlement figure, but the figure i was given means i lose out on about £60!

I pointed out the statement on the letter (as above) and the lady agreed with me that it was slightly misleading an went off to discuss with her manager. after a long time she returned and said that everyone she had showed it to agreed that it seems as though you should just do the simple deduction! however they were not prepared to carry out the transaction until her manager had looked into it! therefore i will be contacted on monday! :mad:

Now i'm not quite sure what to say when they do call, i do just want to get it sorted out and pay it off but in the same token dont see why i should let HSBC have an extra £60!

Any thoughts gratefully received!

MORPH3US

Its because of the £360 you paid, £60 of that is interest which they deducted but since you have paid it now its not coming off the reduced amount.

Its hard to explain, but I think the bank is right!

M

Right, maybe look at it this way: the settlement assumes you pay the loan off before the next payment, but since that has gone through now, you have to adjust it. Now they got the settlement figure by taking away the amount of interest saved from the full amount to be paid, but now the extra £360 has come out, 300 of that will come from what you owe and £60 out of the interest rebate!

Sorry, probably confused you more now!

shazzer22

yeah, thats exactly as i would expect it to be but if you look at the wording of the letter there is no mention of any terms, merely says any payment made would be deducted from the figure ! I told them it was misleading and they agreed. surely as its written in black and white i should be able to get it ?

matto

Maybe the difference is due to PPI payments. As these are probably part of your monthly payment they don't count towards the settlement figure. Once paid I don't suppose they can be refunded and this would also have the effect of reducing the insurance refund quoted in the letter.

Nevertheless the letter seems misleading.

shazzer22

I received a phone call from the manager of my branch today to inform me that she has logged a complaint due to misleading information i was given in the letter and agrees that it infers that it is just a deduction of my payment that i made that wouldl give me the figure for settlement. I told her to go ahead and do the transfer anyway as the longer i leave it the less of a PPI refund i would get!

Thanks for your comments, i'll let ou know what they come up with, they have promised an answer for me by next Monday!

shazzer22

well, just to update you on this, checked my online banking today to find i was credited back £52! so i am glad that i compained about it! woo!:T :rotfl: