HSBC Interest Hike

morewedge

I have a business loan with HSBC of £50,000. Unfortunately, I had to close my shop a year ago and HSBC agreed to let me pay the interest only for a year, although they increased the interest rate by 0.5%. Therefore I have been paying 3.5% above base in 2009.

It is now time to review this loan and I have asked for a further year on interest only so that I can sell my house to pay off the loan when the market improves - hopefully next year - HSBC by the way have a second charge on my property.

I am at present out of work, which they now know.

They have just come back to me with an offer of a further 3 months interest only, but have increased the interest rate to 6.5% above base making the interest at present 7%. This makes it virtually impossible to meet the repayments.


"The bank is concerned over my
1. Failure to convert back to capital repayments as agreed - NOT TRUE
2. My property has not been sold/remortgaged to repay the borrowing. THIS WAS NEVER AGREED"

I'm not sure what I should do. Do I sign the forms and continue, offer to pay some money off the loan? I do have a small amount.

Has anybody any suggestions or have been in this position before?

Thanks