First plus ripoff

purpleparrotuk

Just had a letter from First Plus. They are increasing the rate by 0.8%. This increases our payment by over £40 a month. It's not their usual reason of a base rate change but this time it's to ensure our business is substainably and prudently managed.

What the heck is that supposed to mean?

Clive_Woody

It means they would like even more of your money...nothing more nothing less.


The joys of variable interest rates.

CHR15

And to give them an extra wedge to cover all those borrowers looking for unenforceability.

The good and honest guys always lose.

ILW

It's to cover themselves from all the high risks borrowers they took on a few years ago

Funky_DB

Yep, I too had the same letter. I thought the rate was supposed to be linked to the FHBR?
And does anyone who has a loan have the document which states that PPI is included or not?. I cant find any reference to it on my loan agreement.
Thanks

halifax71

You need to complain to all regulatory bodies now before base rates force further increases. See my other thread http://forums.moneysavingexpert.com/showthread.html?t=1924209

This latest rise is in line with Clause 7 of most peoples agreements. The clause is unfair and must be classed as such.

Be assured once BoE rates rise to circa 5% then Barclays FirstPlus could increase rates by DOUBLE that amount.

I don't know about you but a 20% APR would bankrupt me.

halifax71

Long explanation of what is happening.

It doesn’t matter what the FHBR does NOW, whether it falls or rises. What matters are ONLY two things: (A.) how does the current FHBR compare to its value of one year ago, and: (B.) how does our current FP interest rate compare to its value of one year ago.


Then there are ONLY 3 possible cases, and we can use them to predict their next move:


Case (1) If FHBR today is below FHBR of one year ago, then there are 2 sub-cases:
(1.1) if your Barclays FirstPlus (FP) rate of today is lower than your FP rate of one year ago, FP will either not change it (this is the current situation with all of us) or at most increase it back to its level of 1 year ago THIS IS WHAT HAPPENED TODAY THOUGH.

(1.2) Conversely, if your FP rate of today is higher than your FP rate of 1 year ago, FP will HAVE TO reduce it at least to its level of one year ago (that's what happened to many of us with the FHBR clause back in March-April, and that's what BFP refers to as the "contractual" reduction. Incidentally, only the FHBR clause people received this MINIMUM TERMS reduction, the others didn't, which is unfair in itself).


Case (2) If FHBR today is the same as FHBR of one year ago, then again there are 2 subcases: (2.1) if your FP rate of today is lower than your FP rate of one year ago, FP will rise it to its level of one year ago (that’s when you get the letter saying: “we increased your rate but we made sure you don’t pay more than you did a year ago”); (2.2) Conversely if your FP rate of today is higher than your FP of one year ago, FP will reduce it to its level of one year ago (again, that’s what happened to some of us in March/April last year).


Case (3) If FHBR today is higher than FHBR of one year ago, then it doesn’t matter whether your FP rate of today is lower or higher than your FP of one year ago, FP *will* increase it, by up to twice the FHBR increase from one year ago. No sub cases here! (that's when we got the BoS type letters, excuses, etc.)


We are currently in (sub)case (1.1). In other words, so long as FHBR remains BELOW its level of one year ago, there is hopefully nothing to worry about just yet: our FP rates WILL STAY PUT AND IN ANY CASE CANNOT GO HIGHER THAN WHAT THEY WERE 1 YEAR AGO.

ILW

halifax71 wrote: »

You need to complain to all regulatory bodies now before base rates force further increases. See my other thread http://forums.moneysavingexpert.com/showthread.html?t=1924209

This latest rise is in line with Clause 7 of most peoples agreements. The clause is unfair and must be classed as such.

Be assured once BoE rates rise to circa 5% then Barclays FirstPlus could increase rates by DOUBLE that amount.

I don't know about you but a 20% APR would bankrupt me.

If that is the case, why the hell did you take out a variable rate loan then?

edwards97

ILW wrote: »

If that is the case, why the hell did you take out a variable rate loan then?

When I took out my loan with first plus I was under the impression that variable means that it can go up or down, the best rate i have ever paid was when i took the loan out!! It has never gone below the original rate. This loan is a complete con and I dont know how they can get away with it! I will be complaining to the ombusman again.

I am so angry!:mad:

CHR15

Bewilders me why anyone would think the rate would EVER go down.

No doubt it would go down a fraction of a percent for a short period to satisfy the regulators, then up and up and up and up.

ILW

edwards97 wrote: »

When I took out my loan with first plus I was under the impression that variable means that it can go up or down, the best rate i have ever paid was when i took the loan out!! It has never gone below the original rate. This loan is a complete con and I dont know how they can get away with it! I will be complaining to the ombusman again.

I am so angry!:mad:

What are you going to complain the the ombudsmn about?