Toothfairy Finance / Right of withdrawal from loans

dyson1927

I was wondering if anyone out there has any sensible advice around the rights of borrowers to withdraw from a loan under the consumer credit act, and in particular the interest lenders are allowed to charge borrowers who exercise this right.

On July 21st I took out a payday loan with Toothfairy Finance. On 22 July I sent them a written instruction (to an email address set out in the loan agreement) stating that I wished to exercise my right to withdraw from the agreement, and asking to be notified of the amount due to be repaid.

Despite several mails the comminications were ignored and only a week later was I able to speak with Toothfairy Finance. I was surprised to be informed by them that irrespective of my exercising my right to withdraw from the loan that I would be required to repay the full amount of interest as if the loan had been taken to maturity. This would appear to be in contradiction to the loan agreement terms and conditions (which in the relevant clause on the right to withdrawal sets out different interest payments due in the event of a withdrawal and which does not disclose any requirement to pay the full interest on the loan). This also seems illogical....if a borrower were to take out a £10,000 loan from a bank on a five year term and decide to withdraw after a day, the borrower surely would not be expected to repay five years worth of interest?!

Any advice welcome. I have repaid the full amount in the interim but have noted in writing that in doing so I am not acknowledging that this was the amount due, but rather I have done so to avoid Toothfairy Finance seeking to charge me late penalty fees.

Thanks!