credit union loan mistake

evondoll

Looking for a bit of advice and hope I've posted in the right forum.

Early January this year my step dad took out an emergency loan from the credit union. The loan was to cover funeral costs as my mum died quite sudden and he didn't know how else to pay for the funeral.
A couple of days ago he mentioned to me that he hadn't started paying back the loan and wasn't sure when he was to pay it back as on the loan agreement form the date for the first installment was blank.
He went down to speak to them today to arange making payments towards the loan and was told that he was ment to start paying it in January and he is now three months behind......they have asked him for three months payments + and extra £70 interest due to the late payment.
I don't think its fair being charged the extra £70 as the error was credit unions. Can they force him to pay the extra?

E.

[Deleted User]

would he not have qualified for a social fund grant to pay for the funeral?

jonesMUFCforever

If the credit agreement is not complete it is unenforceable.
(I can't believe I actually said that LOL)

A credit union has a duty under the CCA to ensure its loan documentation is correctly set out just as any bank or other lender.

Mention this to them and if need be get this confirmed by someone like CAB.
I think if common sense prevails then they should waive the charge.

Dr.Shoe_2

Indeed.

The thing is though a credit Union is run on a no profit basis and so by not starting the repayments means that someone else has been deprived of amuch needed loan, probably in similar circumstances. How would you have felt had they told your step-father that they couldn't give him any money because someone else hadn't started to make repayments?

OK, The CU may have been in the wrong to have not filled in the CCA right but you are not dealing with RBS or somebody here you're dealing with an organisation that only exists to help you.

Happytogetdebtfree

whoa i think in the circumstances dr shoe comments like that are uncalled for, if he took the loan in january hes had it 3 months, at the time i imagine the mans mind was on sorting out fumneral arragements etc etc,as stated there is no date on the agreement again it says he activley went down.... less of the
"credit Union is run on a no profit basis and so by not starting the repayments means that someone else has been deprived of amuch needed loan, probably in similar circumstances. How would you have felt had they told your step-father that they couldn't give him any money because someone else hadn't started to make repayments?"
we arent here to make people feel teribble we are here to offer help !

Tixy

The OP doesn't say that this is a charge or punitive interest though. Its simply the additional interest because he has owed more for longer than expected on the original calculations.

I think to consider the route of unenforceability is a bit harsh considering its a credit union (though I appreciate the OP didn't say that they wanted to do this).

jonesMUFCforever

Why do people think that credit unions being a non profit organisation should be treated differently from other financial institutions?
Building societies are in theory non profit organisations - there for the benefit of their members.

Tixy

Okay maybe a wrong choice of words - I think credit unions should be treated differently because they are financial co-operatives.
Because they are funded by people 'close' to you, people who are like you. People who do want to help their community.

If your friend lent your £50 because you were in a financial fix, you'd want to pay them back. Whilst it may be possible to get out of paying them back most of us would feel a higher obligation to pay them back than a bank.
For me a credit union is closer to that situation than to being loaned money by a large corporate commerical bank.
That said I personally feel an obligation to pay back all my debts to banks, to anyone.

evondoll

Sorry it took so long to get back to this. Thanks for the replys.

evondoll

woodbine wrote: »

would he not have qualified for a social fund grant to pay for the funeral?

Sadly at the time with everything being quite sudden we didn't know if this was an option. We knew that there was money in mums bank account to pay costs (but didn't know at the time that the bank could have delt with this).

The credit union loan was only ment to pay costs upfront......as the funeral directors where threatening no funeral without payment before hand.

Evon.

evondoll

jonesMUFCforever wrote: »

If the credit agreement is not complete it is unenforceable.
(I can't believe I actually said that LOL)

A credit union has a duty under the CCA to ensure its loan documentation is correctly set out just as any bank or other lender.

Mention this to them and if need be get this confirmed by someone like CAB.
I think if common sense prevails then they should waive the charge.

Thanks for that info. Although I know my step dad has no desire not to pay the loan, its the fact that it was them that made the mistake and then go and make him feel bad about it and charge extra money when the fault was theirs in the first place.

Evon.