HELP!!! mis sold loan for a kitchen

diddiwedd

Hi im after some advice, we took out a loan over a year ago for a kitchen we purchased from a diy store, we had 1 year 0% and were told that after the year we would pay interest on any outstanding balance. we payed off 99% ofthe loan within the year but still had £200 to pay but not worrying as we were under the impression that it would only be interest on the £200 we would pay.
When we went to pay the remaining £200 plus interest we were told that our outstanding balance was £3000 + and that as we didint complete within the year we would have to pay interest on the initial balance.
I have contacted the company ' creation finance' on a number of occasions but they are saying we have no case.
we were catagorically told when signing the documents that we would only pay interest on the outstanding balance and the paper work suggests the same but they are still not backing down.
What should we do? is there anyone else who has had simular problems or mabey dodgy dealings with creation finance?
We are going out of our mind with worry as we worked so hard on one income and three little ones to pay off asap and now we are faced with another £3000 that we just cant afford.
HELP!!!!!!

Tixy

These agreements often work like this. What does the consumer credit agreemet actually say. You state the paperwork 'suggests the same' but without knowing the actual wording it would be very hard for anyone to advise you.

Also you say you have contacted creation - has this been by phone or in writing?

opinions4u

we were catagorically told when signing the documents that we would only pay interest on the outstanding balance and the paper work suggests the same

A bit more information on the bolded bit please.

chalkie99

As Tixy says this is how these companies make their money and, even if you were told verbally that interest was only payable on the balance, you would have a hard time proving it.

I would be pretty sure the agreement you signed will say you pay the full interest in the event of the account not being fully settled within the 12 month period and, unfortunately, the onus is on you to read what you are signing and the written agreement overrides what may have been understood verbally.

KingElvis

Interest free is a trap for those not on top of their stuff 100%

I was in DFS the other day watching young couples happily signing over their future for a cheap mass produced setee.

CH27

This is how companies can afford to offer 0% deals.

Enfieldian

Did you really spend £20,000 on a kitchen?

Then you paid off £19,800 of it in the first year, but left £200 outstanding....?

How very odd.

JimmyTheWig

Enfieldian wrote: »

Did you really spend £20,000 on a kitchen?

I imagined that the 99% bit was an exageration.
But that then works out around 28% APR, which is probably about right.


OP, I agree with the other posters. This is almost definitely right. It's the norm for these schemes. If you were told differently then you may be able to chalenge it, but it's as good as impossible to prove what you were told.
If your paperwork really does back up what you've been told then you should be fine, but I doubt it I'm afraid.

I suggest that you pay the £200 plus the interest that you were expecting and ask them nicely to waive the rest of the interest as a goodwill gesture seeing as you (a) misunderstood the contract and (b) have settled so soon after the year.

KingElvis

JimmyTheWig wrote: »

I suggest that you pay the £200 plus the interest that you were expecting and ask them nicely to waive the rest of the interest as a goodwill gesture seeing as you (a) misunderstood the contract and (b) have settled so soon after the year.

Look....there goes a flying pig

Apples2

The Interest starts accruing from day one, even on a 0% deal.

If you don't take advantage of the 0% deal and pay in full by day No 365, you already have a nice fat 12 Months worth of interest on top which needs clearing.

The OP isn't the first, and will not be the last (by some margin) to fall over this trap.

JimmyTheWig

KingElvis wrote: »

Look....there goes a flying pig

For the sake of a phone call I'd say it's worth it.
I wouldn't hold out much hope, but it's worth a try.

I'd also speak to the store manager.

If that gave no joy then I'd be tempted to go to the local press. How many days was it between the "interest free" year being up and you finding out it would cost £3000 to settle the loan?
We could use that to calculate an equivalent APR for borrowing the £200 for that many days. Would be huge, I tell you. Quite possibly the biggest number the local paper has ever printed. Could be as high as a nonillion percent!