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Cahoot Flexible Loan

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Comments

  • Well, the closing of my Cahoot flexible loan is still "processing" so it seems.

    As I have been waiting, I noticed a post somewhere on MSE from someone saying they were in the know and that it's worth emailing Cahoot asking if they'll reduce the interest. I thought it was worth an email, so I sent one through the website saying I would consider not closing the account if they'd reduce the interest rate. I got the following email back, which reveals a little about their reasoning behind interest rates (if indeed it's true). I am a bit annoyed that they seem to have done a credit search - I didn't realise that they would (probably silly of me) but I was trying to avoid getting any searches on my record.

    "Thank you for contacting cahoot in Coventry.

    "We refer to your recent enquiry regarding the APR on your Flexible Loan account.

    "As requested we have now reviewed the APR on your account. This was completed by assessing information provided by you at the time of your application and by assessing the way in which you have managed your account.

    "After full consideration, we regret to inform you that we are unable to lower your APR at this time, fully accepting the disappointment this may cause.

    "In reviewing an application, we use a number of different sources of information. Analysis of each of these sources is considered and a credit score is obtained. This credit score and the outcome of various searches then leads us to either accept or decline individual applications. Our scoring system also determines the APR rate, which is offered.

    Our first source of information is the application data supplied and input by you on our website. We check the authenticity of the information provided and use it to carry out a credit reference agents search." [For the record I'm not sure that this is true. The work phone number they have for me is out of date, for example. I'm not sure what they have which they could have checked.]

    "Our second source of information is the credit reference agency check, which is undertaken. This contains information on your current financial commitments and records the number of searches carried out by other financial institutions as a result of applications made for other credit products.

    "The interest rate that has been offered to you does not question your credit worthiness or in any way suggests that we have received adverse information from Experian. cahoot would not have proceeded with your application if any adverse data had been received.

    "We reward customers on the basis of their credit risk profile hence our application process. This process and conditions are clearly outlined on our website and were accepted by you when you applied on line.

    "If you have any queries regarding the above, please do not hesitate to email cahoot using the ‘Contact Us' facility on your personal homepage.

    "Kind Regards,

    "Katy Cullen
    "Who would you rather be in cahoots with?"

    So there we are - although I have to say I'm a little confused about this "we would not have proceeded if we had received adverse information from Experian" thing. I guess they're just standard paragraphs.

    Thinking about it, I bet they haven't even done the credit check - I bet they've simply refused my request because they feel like it, and then sent me the standard letter. Hmm, perhaps an up-to-date statement from Experian is in order... ;)

    HFM
    Everything turns out all right in the end. If it's not all right, it's not the end.
    __________________
  • wacko911
    wacko911 Posts: 678 Forumite
    Part of the Furniture 500 Posts Combo Breaker
    Just had a phone call from Cahoot regarding an email I sent complaining.
    Basic points were:

    I didnt get 30 days notice:

    [Cahoot] The banking code states interest rates can be changed with 3 working days notice and not 30 days notice, the 30 days applies to T&C changes only. I check with the banking code website and this appears to be correct.

    I was on an introductry rate for 12 months (I clearly remeber this be mentioned on the website, it said 9.5Apr for 12months then 10.5% apr variable)

    [Cahoot] You were not on an introductry, the intro rate was for Risk band 1 customers only and you are risk band 2. There was no intro rate for risk band 2 customers in feb 2006. They also explained there were 5 risk bands, I asked if EVERYONE on risk band 2 were having thier interest rates increased and they explained yes unless there were on an intro rate for 12 months.

    [Cahoot] you can have a fixed rate loan @ 7.7 apr if you wish

    I asked why I get charged 10.8% apr on my £1000 overdraft yet my flex loan is now 11.9% apr

    [Cahoot] The maximum you can have of an overdraft is £1000 (anyone disagree?) so the risk is less

    I asked why I was risk band 2 anyhow as I have no other loans, a clean credit file and I have my current account with them and pay going in each month etc..

    [Cahoot] We will check with the credit scoring team and get back to you

    End call

    I have no way of proving I was offered an intro rate, they said it was for risk band 1 customers, but when I was sigining up on the site it gave me 2 different rates one for the first 12 months. I only wish I had printed out or saved the webpages at the time. Do they keep a record of this or anything I can request? On my credit agreement it does say 9.5% variable so Im guessing it hardly matters. Another intresting point was cahoot insisted I was on 9.9% apr, yet I was on 9.5% and only after being on hold a couple of times did they then say, oh you were on 9.5%. It hardly inspires one with confidence if they cant get the basic facts right. I'm only 4 months in on my loan so cant really apply anywhere else for another few months. I wish I would have just gone with Zopa.

    Gareth
  • lynzpower
    lynzpower Posts: 25,311 Forumite
    10,000 Posts Combo Breaker
    Gareth,
    Just a quick one here as IM off out. Did you speak with trading standards. the fact that they dont seem to have a clue what youve got and how youve got it suggests either incompetence or lying. Maybe its bods in the call centre back covering ( Ive been there, has to be done)

    Speak with consumer direct, I wonder whether the consumer credit act will have something for you. I suspect you can get all info about what you applied for via a data protection act Subject access request- or ask them for a copy of your credit agreement, they have to hold onto this by law as far as im aware for 6 years.

    I lok forward to your update ;)
    Lynz
    :beer: Well aint funny how its the little things in life that mean the most? Not where you live, the car you drive or the price tag on your clothes.
    Theres no dollar sign on piece of mind
    This Ive come to know...
    So if you agree have a drink with me, raise your glasses for a toast :beer:
  • wacko911
    wacko911 Posts: 678 Forumite
    Part of the Furniture 500 Posts Combo Breaker
    I have a copy of my credit agreement and it does state 9.5% variable and nothing else. So im pretty much screwed, but I took 9.5% variable to mean if the base rate goes up 0.5% my rate would go up to say 10%. Silly me I know, I didnt think it would mean they could just ad 25% to the rate 4 months in to the loan.
    I've check my webcache for the pages I signed up with but its long gone, and even if it did say something different, they will tell me, you signed the credit agreement for a variable rate loan, very hard to prove any misselling.
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