added interest on a front loaded loan

burntfingers_2

Hi peeps

I hope that someone can help with this question...???

I have a loan that is currently outstanding with Santander...originally it was Alliance and Leicester and I borrowed I think at the time around £11,000/£12000 (it was so long ago that I have forgotten). The interest was front loaded and I had made several months/years payments without any problems then I separated from my husband. (peeps who read my diary know of the bigger picture) and couldn't afford to pay any other than a token payment of £5.00 per month.

I recently received a statement of arrears showing that they have now added on £246.47 as outstanding interest.

When I originally wrote advising of my difficulties Santander advised that as the loan was front loaded interest then they couldn't freeze the interest on the account as it had already been added....but can they then add further interest ???? which is more than what I am actually paying them, at this rate the loan will never, ever be clear.

Any ideas?

Thanks
Bf

CLAPTON

better to post on the debt free wannabe board
lots of info and support on that board

redpete

burntfingers wrote: »

can they then add further interest ???? which is more than what I am actually paying them, at this rate the loan will never, ever be clear.

Any ideas?

Quite possibly, the interest calculated at the beginning of the loan would be on the basis of you paying off the capital at a certain rate. If you are paying the capital off slower than this then there could well be additional interest to pay - you are borrowing the money for a longer period.

Common_Sense_2

The interest probably refers to interest charged on the missed payments.