Irresponsable Lending

Nitronick

I wonder if anyone can assist me???

I am currently in the process of making a formal complaint against Lloyds TSB relating to possible miss selling of loans (including PPI) and irresponsible lending after they allowed my wife to run up a 1,000 overdraft dispite not having a regular income. They sold her a loan to clear the OD of £1,100 at a rate of 18.9% APR including PPI over 5 years at £35 pm dispite the fact she wasnt working. Then 1 year latter they allowed the OD to run up again to £1,200 and this time sold a £3,000 loan @20.1% APR including PPJ over 5 years at £100 PM. At this time my wife was now working earning £7k PA PT hours. The loan was taken out less then 2 weeks ago and the bank are refusing to cancell the latest loan dispite my wife paying £1,600 back into the loan account. They also are refusing to reinstate the Overdraft and when the 3k loan was issued they didnt offer to clear the original loan dispite lending more then enuff to do so.

Can anyone give me some advice on this matter? I seriously think that they have acted irresponsibly in there lending and sold products that were not needed at seriously over inflated rates.

Just to complete the picture My Wife and I were seperated and are just in the process of reconciliation which is why I was not around to advise her regarding this matter.

Many Thanks

Nick

mollymauk

Hi Nick,

I'll be watching this thread with great interest, as I'm in a similar situation with Lloyds.

I'm now about £5000 in debt, which all started when I was £1000 overdrawn, and Lloyds persuaded me to get a loan to pay it off (even though I didn't have a regular income), and then that process was repeated 3 times.

I was sold PPI too ( I was young and foolish enough not to notice for years and years) even though I was already self employed, and therefore not eligable to claim.

I'm curious to see how many people feel that Lloyds were lending irresponsibly.

Xbigman

Your wife did not have a regular income. Do you mean she was on benefits? If she was on benefits then that was her income, if she was being supported by someone (you?) then she had money coming in and that was her income.

She ran up an overdraft. How? If its bank charges then you should claim them back. If it was an historic overdraft (from before her income vanished) then she should not have used it in her new circumstances. Now, if she went to Lloyds and asked for an overdraft facility and told them about her new income circumstances and they granted it, she has a complaint for irresponsible lending. But that in itself means nothing.
If you could give us some more detailed info on how the overdraft came about. IE Did she apply for it, was it increased over time or done all in one, this would be a lot clearer to us.
I do think you are being a bit rich complaining that they will not reinstate her overdraft. Has she not learnt the dangers of OD's? They have probably done her a favour.

Banks are there to sell loans to people so if your wife kept running up an overdraft and then struggling they will then convert to a loan to be helpfull (although it often isn't helpfull). As far as the loans are concerned I don't think you have any legal complaint.
If the loan has it in the terms and conditions that it cannot be repaid early or that there are penalties then thats it. I suggest you get the loan documents and have a good read to see what it says. There may be some room for a complaint there but you (we) need to know exactly what the situation is.

PPI, now that is different. If she was sold PPI with no regular income then she was mis-sold. Make a complaint and try to get it cancelled and refunded.

Don't forget to reclaim any bank charges.
Regards



X

ManAtHome

Generally sound advice from Xbigman - bit of research needed (particularly the PPI and charges, although even the interest rates look more like credit card than loan rates).

Dunno what it's like these days, but they always used to sign off loans/overdrafts etc on joint accounts based on overall income whether one or two were earning (OH being implicitly liable for debt). Mind you, that was when you had to pop in and see the manager, not just click on a website...

Did you still have a joint account at the time? If not, did she declare her income and expenditure accurately?

Phoenix79_2

Irresponsible lending by Lloyds? or irresponsible spending by your wife?

The APR on the loan is scandelous though. Is it possible to take out another loan with a different provider to clear it? One without PPI. Then you can leave Lloyds. Also consider moving your accounts away from them.

Nitronick

Thanks for all the replys so far.

Just to clarify a few details as requested.

The initail OD was set up and increased £100 a time over a period of 6 months. This was when my wife and I were still together and she did not have access to my account. This was a root cause of the split. Just after the split she took the 1st loan out.

After the split, I was making regular payments to help maintain my kids so I suppose this could be looked at as a regular income.

The second over draft was increased again by £100 a time and once again the bank converted this to a loan.

I will agree that my wife is responsable for irresponsible spending! But my argument is how can a bank continue to raise an OD limit when the account holder has a recent history of struggling to reduce an OD. Secondly how can they justify lending £3k to clear a £1k OD and not use the excess to clear an initail loan? It smaks of poor irresponsable advice aimed at increasing the commision payments of the guy who sold the loans.

When The Wife and I visited the bank yesterday the "finacial advisor" who set the loan up refused to give us a breakdown of all charges made by the bank when from reading parts of this forum it seems my wife has a right to ask for these.

I have a meeting with the manager on 30th November and will post back then as to the result. And yes I will be leaving Lloyds TSB and never allowing my wife near a debit card ever again. Infact never near a shop again:eek:

Thanks

#Nick

regularsaver1

Come on - your wife obviously asked for the overdraft to be increased

and also signed for this loan the other week and signed for the ppi - why did she sign for it?

I can see some points that when the loan was taken the o'd should have been cancelled, but it sounded like she relied on that overdraft when she was in that situation

Nitronick

regularsaver1 wrote:

Come on - your wife obviously asked for the overdraft to be increased

Yes she did. But it is the banks responsabilty to ensure that the person they are lending to is in a positon to pay the money back. My wife had a history of financial problems yet the bank still willingly upped and upped the OD. That In My Book Is Irresponsible.

regularsaver1 wrote:

and also signed for this loan the other week and signed for the ppi - why did she sign for it?

Because she was pressured into it. Made to feel that the only way out of her situation was to take a loan from them at a rate HIGHER then the Overdraft. That In My Book Is Miss Selling

regularsaver1 wrote:

I can see some points that when the loan was taken the o'd should have been cancelled, but it sounded like she relied on that overdraft when she was in that situation

Yes the OD should have been and was cancelled but the pre-existing loan was not.


On The Plus side. After a meeting yesterday with the bank when the guy flatly refused to cancell the loan and reinstate an overdraft today he phoned my wife and informed her he had cancelled the loan and reinstated the overdraft facility. He also sounded very worried that I have a meeting with the bank tomorrow at 15:30 and even suggested that we cancell.

How wrong is he. I intend to file a complaint and claim back all bank charges and have the PPI on the first loan cancelled and refunded. I am also in a positon to clear that loan and once I have done that will be leaving Lloyds TSB. I want to push this not just to help my wife but to wake Lloyds TSB up and hopefully prevent anyone else being put into this situation.

Lloyds TSB 0 NitroNick 1

Nick

regularsaver1

so the old loan was not consolidated with the new loan?

won't your wife have to file the complaint as it was in her name and you know data protection they can;t discuss with you, blah blah blah

Tootsie_Roll

Yet another example where the real fault lies with the partner but it's the bank getting all the blame ! Truly unbelievable.

Get your Wife to take responsibility for her actions or you will find yourself in exactly the same situation again if you can't learn from this mistake and move on.

Emmzi

Nitronik,

unless she is mentally incapactitated (and it can be shown that the bank should reasonably be aware of it) I can't see this going much further. If hse's signed for overdraft application/ loans and has been given time to read them.. she's liable. I think you could expend a lot of fruitless time and energy putting the blame elsewhere.

btw the mentak illness thing is not meant as a 'slur' - it's just the only circumstances in which I have seen this kind of thing be reconsidered.