G E Money Home Lending

bullinn1

Hi chaps I don't have a lot of detail because my sister was upset when we spoke on the phone. She works all hours and has very little money but some while ago she had a big repair bill for the gas boiler, she needed to spread the cost and the guy got her to take a loan with G E Money Home Lending which is costing a fortune. She has to renegotiate her mortgage (Lloyds) and the bank manager, kindly, has offered to increase the mortgage (4.9% fixed) to pay off the gas debt but she says the penalty is exorbitant ... has anyone any experience of this sort of draconian behaviour please ? Best Roger

Joyful

I dealt with a similar problem last week for a customer. Although the interest rate was on the paper she signed it was very high and she now could not afford it. It was also over 10 years. She advised me that she had a Solicitor friend who was looking into it. I suggested the CAB or her local Councillor to contact GE money to see if they could re negotiate the interest rate as she was elderly. Until we can get people to check over a contract with a 3rd party before they sign this will keep happening.

As always if a repair to anything is needed we should get a quote and then shop around for the best deal. We should always check the interest rate.

For any Elderly or low income people out there Warm Front for England and EAGA for Scotland can help sometimes with a whole new heating system.

bullinn1

Thanks for that Joyful - I'll let her know. It, of course, shouldn't be possible for companies to take advantage of the vulnerable but what can we do ! - Roger

david39

When you say that to pay off GE Money by upping her mortgage involves an enormous penalty - is the penalty being imposed by GE for early redemption or by the bank as a fee for changing the terms of the mortgage?

If the penalty comes from GE then I understood that the law had been changed a few years ago so that the maximum penalty for early repayment on such loans would be one month's interest (which because of the way it is implemented becomes two month's interest).

This change to the law was retrospective. I had a loan from GE that had a huge penalty for early repayment that got changed to the new terms when the law was passed. The original GE terms were draconian but, to give them credit, GE did honour the new terms without any prompting, when I asked for a redemption cost after the change.

If the charge is by the bank for a renegotiation of the mortgage, then I don't think you have a choice other than to accept or reject it.

bullinn1

Thanks David, it's GE for early redemption - maybe she has out-of-date information, I'll get her to check. Good of you to take the time. Roger

david39

Rogertb

If it is a loan made prior to 2007 and GE are asking for an exorbitant sum to clear it, the redemption terms may be covered by the "Rule of 78".
I won't go into the complexities of this (Google it for a detailed explanation) but the legislation I referred to in my earlier post outlawed these terms. Other than under special circumstances, GE cannot apply them and must abide by the terms of the new legislation.

I would write to GE and ask them for a redemption figure and also ask them to show how this has been calculated.

bullinn1

Thanks David, I'll check out Rule of '78 - good of you. Roger