guarantor loans

bywing2327

Hi need help urgently. I recieved a bank statement today and noticed that some money had been taken out £173. I phoned the bank and have found out that my wife is guarantor (unknown to me) for her sister who took a loan out for £3000. This loan was taken out 3 months ago and her sister has defaulted on the loan, which is why our bank account has been debited for £173.

As we are on the mortgage jointly can we decline being a guarantor on the grounds that i knew nothing about it?

After speaking to my wife about this, she has also told me that when she became guarantor she had a conversation with the loan company who told her that if her sister did default on the loan that the money would not be withdrawn from our account untill 2 weeks after the due date. This has not happened, in fact they have taken it 3 days after the due date.

Can we decline to be a guarantor because they have breached their contract?

Any help or advice would be greatly appreciated

thanks

Emmzi

not unless you have it in writing about the 2 weeks.

I think your arguement here is with your wife, not the lender. Or wife's sister.

CLAPTON

what were the T&Cs she signed say about payments?

bywing2327

Hi i am just trying to find them

fozmcfc

Is it with FLM loans as well?

Apples2

Second thing to find is your Wife and her Sister.... then bang their heads together.

You're going to end up repaying that £3k loan but with daft interest, probably about £4k.

bywing2327

hi yes absolutely this loan was with FLM

fozmcfc

From their website

If a guarantor jointly owns a property with someone else can they still be my guarantor?

Yes, it's not a problem if you're guarantor is a joint homeowner, as long as their name is on the mortgage. We'll send loan statements to the guarantor and an initial letter confirming the loan. These are sent in FLM envelopes so we would always recommend that both homeowners are aware of the agreement.

So it does seem as though it can be done with just one of the homeowners.

I think you really need to speak to your wife, FLM are pretty difficult to deal with reading other peoples post, but as someone else has said, if the sister doesn't pay then your wife has to, that is basically what she has agreed to.

If not you will be in for a lot of hassle, phonecalls and letters and could end up with ruining your wifes credit history and yours if as I suspect you are linked credit wise.

I wouldn't disappear from the boards though, others may have some more advice, but it looks grim to me for your wife, unless the sister starts to pay up.

bywing2327

Hi I am the wife, when i agreed this over the phone i asked them what happens if my sister misses a payment - they told me that they give them 2 weeks to sort it out before they come to me for the money.

When i spoke to the loan company last month, he asked me for my debit card number so i gave it to him so he could take the payment.
When i spoke to the loan company today in regards to this months payment they had already taken payment from my debit card of which they had stored on their computer, so i asked him why i was told that they wouldnt come to me for the money till after two weeks and he said 'if we have your card details then we will take payment automatically but if it is by Direct debit we will give you 10 days notice.

Apples2

I still think your focus is in the wrong direction. It should be aimed at your Sister.

Why isn't she paying HER loan like she promised?

FLM are going to be very difficult. They make a living from taking money from the guarantor (not the borrower, the guarantor).

All the mainstream sensible lenders KNEW your Sister was not going to repay this loan, so did FLM.

It is common practice for them to take payment immediately after the attempt fails from your Sister.. you need to get used to this, you will face this repeatedly.

If you start avoiding/missing payments, it is your credit file you are destroying. This is essentially YOUR loan, not your sisters.

Your sister can happily ignore this debt from now on, most posts on here are regarding this issue where the borrower legs it leaving the guarantor feeling cheated.

fozmcfc

TBH it what is signed for in agreements, that really count, I agree with Apples, sister needs to really be contacted and find out why the payment hasn't been made.

If it is a case of the sister never going to be able to afford the repayments, then you might even be better settling it early and see if you can save on some of the high interest.

Even if you need to take out a loan to cover it, it could well work out much cheaper.

Looking at the FLM website it is full of Q&A's and having looked, it looks like you will find most questions you are querying answered on the site and also in the terms agreed.

Hopefully others who have had dealings with FLM can give you further advice on what to expect if payments keep getting missed.

As one who has been let down by people a few times after lending them similar money I do have sympathy with you, but I just can't see you will get anywhere arguing with them.

Good luck with whatever you choose to do.