HSBC Managed Loan, 0% APR

saskia1

touting for what??? business?? hahaha

just meant it as giving advice as work for the bank and am in financial dire straits myself (just read that back and what a contradiction!!)

just trying to help & offer support..............

but you're quite right - DON'T PM me anything bout HSBC bank -ask on here!!!!!!!!!!

10past6

saskia1 wrote: »

but you're quite right - DON'T PM me anything bout HSBC bank -ask on here!!!!!!!!!!

My posted never stated you were “touting” I stated it could be seen as “touting” however, I posted for your own benefit

303

Well to cap off a particularly stressful week, my wife and I have both come down with tonsillitis, so I haven't been online as much as usual and therefore haven't visited the forum until now.

We finally decided to bite the bullet and signed & returned the Managed Loan agreement earlier in the week. It's now been processed, and logging into Internet Banking I can clearly see that the balance now showing for our 'Managed Loan' account is the exact same figure quoted on the initial offer. I can also see that our credit cards, overdraft and personal loan have all been paid in full and closed off. So now, a week from pay day, we find ourselves in the very unusual position of actually being in credit with our current account! Can't remember the last time that happened!

@foolishqueen - I have to say, it's probably not worth calling the CCCS about it - I spent ages on hold to them the other day (at least the phone call was free), just for some very uninterested sounding girl to tell me to make sure I check the small print, and things like that. I thought they were supposed to be trained debt counsellors?? Maybe try National Debtline - I tried calling them but was unable to get through. But having gone over and over the fine print of the Managed Loan agreement, and spent hours searching online for information about them, my wife and I came to the conclusion that the terms we were being offered (which seem drastically different to the majority of Managed Loan agreements) were worth accepting. I mean, it was only when I was looking back over our credit card debts yesterday that I realised that the APR on our HSBC Mastercards is now 17.9%, for crying out loud. And I have to say I don't actually know what the interest rate on our overdraft is, but I'm guessing it's even higher than that, so it would take a fairly major hike in the base rate before our Managed Loan agreement starts to look like a bad decision.

@saskia1 - Thanks for your comment(s), they made very interesting reading! So HSBC staff are just as likely to get harsh treatment as its customers?! I think I would like to talk to you a bit more about how MLAs work, so I may well PM you if that's OK

foolishqueen

Hope you are both feeling better 303

I think I may sign up to it to. Whilst I'm sure eventually interest/charges would be stopped on my current HSBC loan, I bet that would take a while. With the MLA, it stops straight away. Does anyone know if they default you on your credit file, or is it just a straight swap from one loan account to another?

I suppose the only downside is HSBC reserving the right to change the rate on the loan, but nothing is certain anyway without an MLA. I think I'll save myself some hassle now and agree.

Cheers guys.

Eupho

I have a loan (about £3500 left now) and a £2250 CC with HSBC.

I've just sent all my creditors letters/offers DMP etc.

If HSBC sent me something like that I might be tempted to tell them to shove it.. :rotfl:

But that's just me personally ... I went to them for help when I had £15G on cards I wanted to pay off.. They wouldn't help me. :mad:
But said I could have a 6G loan.. and £2250 CC (that I could do balance transfers on) ..instead..
It didn't really work well (at ALL!) ... all I got was £240 more to find each month for those..

now here I am some way down the line with £34 G of debt instead.. :rolleyes:

I hope they dont offer me that too.. I might let Rrrrrrrrriiiip. :rotfl:

DevonGirl

Good for you Eupho! I have turned down an HSBC managed loan and don't regret it for an instant. I did do internet research on the subject, just in case there was any bias on this site, but really struggled to find any good reports on them. See below for BBC story.
http://news.bbc.co.uk/1/hi/uk/7145579.stm

Finally, CCCS advise against managed loans - they are totally unbiased in my experience so I'm happy to go along with this.

Gettingontopofdebts

Had Managed Loan with HSBC for last 3 years (£22ooo) - total debt was £75000!!!! Things gradually becoming better.Terms for ML are 1% above base rate - NOTHING has been changed regarding my Terms and Conditions over past 3 years, and all has been well. The interest on my Personal Loan at the time was also taken off the total owed on the ML.
Best of Luck.x

foolishqueen

With the rate being offered on my MLA of 0% and the same for 303, I'm not sure I can think oy many reasons not to take them up on it :S

A few things though look off in my agreement:

1. In the Key Financial Information section (first part) is says x number of payments at £x, starting on 25/06/09 with a final payment of £x on the 25/06/09 i.e. it says the last payment will be the same date as the first payment. I assume this is an error when they produced the document?!

2. In the Early Settlement section, it says the amount to settle after a quarter of the term has passed will be £26,403:eek: But after half of the term it's £17400. Any reason why the first amount is so high?

3. Finally, it says in the document I have to sign that I agree to payments for the MLA going out of the current account I have with them (but no longer use!). Obvioulsy I pay CCCS on the 1st of the month and they in turn pay my creditors. Can I just amend this bit or do HSBC insist on paying them directly?

I'm thinking points 1 and 2 are to do with the APR being set to 0 and their systems getting a bit funny when it tries to work out the life of the loan and the required payments!

Any advice appreicated before I sign the thing

DevonGirl

Hi FQ
I've made my feelings known about managed loans but will try to help you in an unbiased way!

foolishqueen wrote: »

With the rate being offered on my MLA of 0% and the same for 303, I'm not sure I can think oy many reasons not to take them up on it :S

A few things though look off in my agreement:

1. In the Key Financial Information section (first part) is says x number of payments at £x, starting on 25/06/09 with a final payment of £x on the 25/06/09 i.e. it says the last payment will be the same date as the first payment. I assume this is an error when they produced the document?!
Yes, assume this is a typo - ask for a new document before signing though, rather than just taking their word for it on the phone.

2. In the Early Settlement section, it says the amount to settle after a quarter of the term has passed will be £26,403:eek: But after half of the term it's £17400. Any reason why the first amount is so high?
I think this is because the loan is 'front loaded' i.e. the interest comes off first, so if you were to settle soon after taking on the loan, you still need to pay the vast majority of it and they still want to make a profit.

3. Finally, it says in the document I have to sign that I agree to payments for the MLA going out of the current account I have with them (but no longer use!). Obvioulsy I pay CCCS on the 1st of the month and they in turn pay my creditors. Can I just amend this bit or do HSBC insist on paying them directly?
I assume you now have your wages paid into an account separate from HSBC, as CCCS advise, so you can have complete control of your money? If so and HSBC require it to come out of their current account, just set up a standing order from your new account for the exact amount, into the HSBC current account.

I'm thinking points 1 and 2 are to do with the APR being set to 0 and their systems getting a bit funny when it tries to work out the life of the loan and the required payments!

Any advice appreicated before I sign the thing

Hope this helps!
Good luck!
DG:D

foolishqueen

Hi DevonGril,

Yep, I hear what you and many others are saying about managed loans I suppose in one way, it's just the easiest option - I may live to regret it, but then my finances are wrecked anyway, so I think hey, why waste time worrying over the small details.

I think what I will do is write to HSBC and ask them to confirm some of the points above. I don't want to have to pay them separately as I'm sure this would end up confusing things, especially with the CCCS.

My understanding is that basically I'll have no interest to pay, although I know they can up the rate in the future (which I am sure they will!).

I'll post back and let people know what they say.

Hope everyone enjoyed the lovely bank holiday weekend. Back to work tomorrow :mad:

Thanks.