Secured Loan

Pinklouise

Hi,

I made the biggest mistake of my life by taking out a secured loan. It is a variable rate loan and i have only seen one reduction since base rate altered. They are quick enough to increase the rate but not so in reducing. Does anyone know if they have to?
Im currently paying 8 or 9% and thought the purpose of reducing the base rate was to help out with lending. its not helping me!!! Except now that im concerned that when they increase base rate again they will increase may with it which i wont be able to afford.

Thanks in advance

Louise

onlypaddy

is that 'variable' or 'tracking' rate?

big difference is that tracking rates stay a certain amount abouve the bank of england base rate, whereas loan companies control when variable rates change.

if its only variable i wouldn't expect any decreases

Pinklouise

Its a variable. You would have thought that they could pass something on.

_Andy_

As its variable there is no obligation for them to pass on any cuts in the base rate.

[Deleted User]

Pinklouise wrote: »

Its a variable. You would have thought that they could pass something on.

could be they have pulled out of lending and dont need to impress anyone,so existing borrowers will pay and pay and pay,happened to me in the 80s when citibank pulled out of mortgage lending.

halifax71

http://forums.moneysavingexpert.com/showthread.html?t=1945441

Have a look at the above thread - this will probably explain why and how thay are doing this. Although the link is Firstplus related i've no doubt it's relevant to other secured loan companies.

When you say you're concerned that rates will increase when base rates increase - of course they will. Many posters on here say that that will your own fault by the way.

Did you not know that "variable APR" was supposed to mean that all base rate increases would be added to your APR but base rate decreaes are to be treated as a bank bonus? Never mind - pay up or we'll take your home.