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unenforceable Loans

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lugsie
lugsie Posts: 7 Forumite
6 Years ago i took out a loan with the Halifax for £25,000 over 120 payments of £277 per month. But from the first payment they have only been taking £177 per month going down now to £138 per month as interest rates have dropped. It seems to me that they have actually put the loan to a longer term than that which is on the agreement, ie if you pay £177 for 120 payments it only comes to £21140, so there is an odvious shortfall. My question is this, is this loan unenforceable and do i stop paying it or do i continue paying untill i have made 120 payments then stop. any advice would be brill.. many thanks.

Comments

  • Jamesf81
    Jamesf81 Posts: 125 Forumite
    Dont stop paying keep up with the payments then you will not be leaving yourself open and they will not have anything on you.

    If they have made the term of the loan longer this could result in you paying more. Really you need to discuss it with the bank first hand and if it turns out you are not paying extra then it is a good thing for you as you are paying lower monthly payments.

    If you are paying more then you need to ask them why they have not been sticking to the original agreement and you have not agreed to any change.

    Keep paying though!
  • Tixy
    Tixy Posts: 31,455 Forumite
    I agree with James, whatever you do don't just stop paying.

    Have you still got your original loan paperwork? presumably it does say on there 12 payments at £277 as you had requested?

    You will almost certainly be required to pay back for longer than the 120payments. You may be able to negotiate so that you only pay the same amount of total interest that you should have paid over the 120 payments (even though you'll be paying for longer).

    Find the paperwork out and then raise the issue with the bank, at least then they can correct it to the correct repayments sooner rather than later, otherwise you could be paying off the loan for years.
    A smile enriches those who receive without making poorer those who give
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  • Anihilator
    Anihilator Posts: 2,169 Forumite
    What would you have done OP if they were taking £377 per month?
  • _Andy_
    _Andy_ Posts: 11,150 Forumite
    Why didn't you contact them six years ago and ask why they were taking a payment that was different to what you expected?
    It seems like it's only caused you concern recently when you've got it into your head that you don't have to pay.
  • ouch - that gotta hurt :(
  • Wutang_2
    Wutang_2 Posts: 2,513 Forumite
    _Andy_ wrote: »
    Why didn't you contact them six years ago and ask why they were taking a payment that was different to what you expected?
    It seems like it's only caused you concern recently when you've got it into your head that you don't have to pay.

    Maybe he only checks his bank statement every 6 years?....and reads a lot of stuff about getting out of paying inbetween?
    Hi, we’ve had to remove your signature. If you’re not sure why please read the forum rules or email the forum team if you’re still unsure - MSE ForumTeam
  • I think it depends on the type of loan OP has - if it is a fixed rate personal loan then he makes his payments and that is it - if it is some kind of variable loan then there will be a term and condition covering this in the paperwork.
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