An unwelcome loan

BigIan

Hi,

Please could someone help me, 4 years ago I got a loan with welcome finance for £1500 in 2008 I topped it up to £5000.

I have recently reclaimed my ppi from them and got a rebook form through saying that after they have taken some of the money for arrears (i am in debt management) I would owe £5000 having paid £4300.

Today I got a statement from them with a new account number (I am presuming they do this for the rebook of an account) it shows all of my payments but when i turned the page over it had capitalisation £18861.54 for a month in 2008 then raising from 733.15 a month to 1604.09 for the current month every month since. Surely this cannot be right.

As in the rebook details of the loan my outstanding balance would be around £5000. I have also received a notice of sum in arrears which is a total of £53,236.39

They were meant to be sending me a cheque but instead my account has gone up from £5000 to £53,236.39

They are adament this is right even though they have sent paperwork through to me stating I owe £5000 all it says in the notice is fees for payments i failed to make, I have never missed a payment even before DM. I just pay at a reduced rate they have accepted.

I have had nothing but trouble with welcome as i originally cancelled the insurance within 30 days of the loan but they never took it off even though they faxed me to say it was done.

Thanks in advance for any advice

Ian

Emmzi

£53k seems unlikely to be the arrears amount. I think you need to post the exact wording of the original loan paperwork, your debt management paperwork, and what you have been sent now.

BigIan

Hi,

Original loan £5000 over 48 months 45.63% APR
Acceptance fee £75
Interest Charge £4744.84

Total paid so far £4296.12

This was the loan agreement/Update that I received at the end of June once PPI had been removed

I then received a statement which had a list of payments from dec 2007 and on the other side a list of Capitalisation starting in Jan 2008 the first one £18861.54 then in Feb 2008 £733.15 increasing each month until July 2010 where it reached £1604.09

Then I received a notice of sum of arrears

which states

Opening Balance £53,236.39
Shortfall for the purpose of this notice £2601.01

According to my debt management company

Welcome wrote to them saying that the amount owing on the loan was £7721.17

I am hoping that this is just an error in the system as I cant see how they could charge £18861.54 interest for one month!!!

Any advice welcomed (forgive the pun)

Emmzi

I would write to welcome and ask them to state the outstanding amount including a breakdown of interest and charges. The £53k clearly does not stack up at all.

Apples2

I reckon there is a decimal point in the wrong place. That would be some kind of record even for Welcome.

PNPSUKNET

I would raise a formal complaint by recorded delivery, then get the fos to take a look. You have a high chance that they will slap them for it.

Silvafox

Yeh, that's clearly a mistake. I have had plenty of dealings with them, and unless you're not telling us something - they must have made an admin error somewhere. Do as the other posters suggest and get a breakdown of the £53k.

BigIan

Hi All,

Thanks for all your advice, I have received a phone call today from Welcome stating that it is a mistake in the system and they will send a letter out confirming this. They cant give me my PPI money back as they cant correct the mistake for 4-6 weeks as it has to go through the IT department!

Cheers

Silvafox

Phew, that's good news then mate.

Fiddlestick

BigIan wrote: »

Original loan £5000 over 48 months 45.63% APR

45.63%?!

Is that typical for Welcome Finance?

Silvafox

I think it is around that figure for unsecured. Even their secured loans are about 30%...