Irresponsible lending by looted? Advice really needed

Nat85

Hi, my husband banks with lloyds Tsb and has had an £8k od for years at it's max. I have received family money before now which we have used to pay it off but our outgoings are more than incomings so it it maxes out again and again. We have consolidated our debts before now but last year my husband was made redundant. He didn't want to worry me that we couldn't afford food etc so he used a lloyds credit card with a limit of about £1k on it. When maxed he asked to Inc limit which they did repeatedly until it went up to £17k! As my husband banks with them they could see he had no incomings at all and was maxed on his overdraft. We have written to them saying we can afford the 400 monthly payments but as the interest is about 380 it will take forever to pay back. Could we put it into a loan with a fixed end date or freeze interest? Answer.....no. On Friday he then got a sales call offering him a lloyds loan! They went through full process saying he could pay off his od and credit card, totalmof 25k and have it on fixed payments of 400 and pay off in about 8 years. They then said he didn't meet lending criteria. I think they have been guilty of irresponsible lending and want to know what, if anything, we can do? Please help me!!!!:o

dmg24

I think you have been guilty of irresponsible borrowing. What you can do is stop blaming the bank, and contact one of the debt advice charities for advice on managing your debt.

Tixy

Your husband requested the credit limit increases so he needs to take responsibility for how large the debt has got.

If you are struggling to repay the debt you could consider seeking some free advice from one of the debt charities. You might also want to seek some advice over on the Debt Free Wannabe board and post up a statement of affairs on there to see if people can make suggestions to decrease your outgoings so you can afford to throw more at this debt each month.

Nat85

Thank you both for quick replies. I know we are responsible but is it really that straight forward that we have to pay it all back on current int rates? Happy to pay back what we borrowed just not at ridiculous rate and also as his bank shouldn't they be checking his salary etc before adding 16k onto credit limit? He didn't say he was earning and also they could check as he has banked with them all his life?

opinions4u

I think they have been guilty of irresponsible lending

You're right. They are guilty. Of lending to an imbecile.

Tixy's post above points you in the right direction.

Sorry if that's harsh, but he's a grown up, he had limited income and borrowed stupidly.

Nat85

Not harsh, I just thought advice would be more constructive. Maybe I'm naive but I though banks had to do credit checks before lending???? and if they did they would have seen that apart from our mortgage almost£60k of credit cards and loans are in his name. Stupid I know and I am living with consequences but am trying my best to sort our situation out. Thank you anyway for taking time to reply.

ILW

Who spent the money?

Nat85

To clarify I am not after a free meal I am after a lower interest rate and an end date on paying it back. I have already said that we accept we owe the money!!!! I didn't ask for advice on how to write this off, I am asking where I stand on maybe reducing interest etc. Don't assume everyone is after a free ride!

Tixy

What did he spend £17k on in a year? Thats some sizeable spending for someone without an income. Is there anything that could be sold to put money towards the debt?

What is the 'ridiculous' interest rate? Is that the rate that the card was at when he spent the money?
Or have they rate jacked his interest rate? if so why did he not reject the increase rate rise?

If he couldn't afford the minimum debt repayments based on reasonable living costs then its possible they may agree to freeze or reduce the interest, although that would be at the expense of his credit file (which if your are financially linked would have a knock of effect to yours) - you'd need to work out the statement of affairs or speak to a debt charity to see if this might be an option for him.

Edit - I see you've mentioned he has other debts as well - I really would seek some advice from one of the charities. Creditors like you to treat them all equally so if he needs to ask for reduced payments or an interest freeze for one he should do it for them all.

Nat85

The money was mainly spent on paying other debt..... It is useful to know it would impact on my credit rating as I assumed that but didn't know. My credit rating currently is fine as I manage my money well. A series of redundancies and silly loans from years ago have contributed to the current situation. I think it is hard to face up to but we need to now. Thank you or posts. Int rate not changed no, I think it is over19.9 apr but on 17k that adds up.... Thank you for help. Oh and as for selling.... Not much left to sell!!!!

opinions4u

Nat85 wrote: »

Not harsh, I just thought advice would be more constructive.

Post #3 by Tixy. Get a statement of affairs from www.makesenseofcards.co.uk.

Post it on the Debt-free Wannabe part of this forum.

Take it from there.

One outcome could be that it's a mess you won't get out of with a bit of smart budgeting. In that case CAB or one of the debt charities is the way to go to get help with negotiating lower payments etc. If that's a route you have to go down it will trash your credit rating for years to come. But that might not be such a bad thing.

Good luck (and give hubby a slap!).