Warning on Moneyback loan catch

edited 30 November -1 at 1:00AM in Loans
2 replies 742 views
mayb_2mayb_2 Forumite
894 Posts
edited 30 November -1 at 1:00AM in Loans
One of the best sources of a cheap unsecured loan, without insurance, sugested on Martin's site is Moneyback an off shoot of Alliance and Leicester.

I wonder if anyone else has had the same experience with this as I did.

This is an online loan application and both my husband and I applied for a £6000 loan over 3 years without insurance. The response was that we had to phone a telephone number to process our application. I did this the next day and spent a very long time on the phone warding off a sale of the insurance with the loan. I informed the salesman that we had decided we did not need this insurance and that no matter what he said would not be buying it. I also said that we would buy insurance separately if we thought we needed to. I said that if it was a condition of the loan then just forget it we would go elsewhere. I said that no matter what he said to me I was not going to change my mind. In the end he agreed to grant the loan without the insurance.

We then received written notification of our loan including the insurance we had agreed to have!! To make matters worse the amount of the insurance for the term of the loan, was added to the loan and interest would be charged on that whole amount over 3 years. No mention of this insurance being added to the loan was mentioned during the sales spiel and what sort of a scam is that?

A phone call followed from the company asking us if we intended taking up the loan - I think they now understand that we wont be and why. However, they said not to worry they could take the insurance off of the offer. So why did they put it there in the first place?

We went to another suggested site and did the whole thing on line with no problems whatsoever.

Anyone else had this experience of was it just one over enthusiastic salesman giving this company a bad name.?

Replies

  • All calls are recorded and monitored (I kick up a fuss and complain)... But you should take on board that it is part of the agents job to offer lp, and TRY to ask questions around the lp, if not and you took the loan without lp unadvised on the lp product (as all lp products are different - believe it or not!) and unaware of the product your actully saying no to, then something happened to you in the way of for example you get hit by a bus and but the loan still needs repaying is that not a form of irresponsible lending? In five years time are they not going to be screaming why wasnt I offered it or at least informed of it?

    You might not agree with lp (or just lp from a lender) and the agent certainly shouldnt have made you feel pressurised or upset (and definitely should have sent it with lp) But arent we all ultimately 'just doing our jobs?'
  • mayb_2mayb_2 Forumite
    894 Posts
    I did write and complain and subsequently received an apology from the loan company. However, I had explained to the sales person that I had looked into this and I knew I could purchase a much cheaper cover elsewhere. (see Martin's main site for this). I also had enough money in savings to cover the loan but for my own reasons did not want to use these to purchase the car and explained that too. I had the product explained to me ad infinitum and constantly repeated the above.

    The part I objected to most of all was that in all the time he took to explain the product he forgot to mention that the whole cost of the insurance would be added to the loan and then interest charged on it for the next three years.

    So whilst I take on board what you are saying and understand this, why sell a product on line and then insist you ring up, why ignore the fact that the insurance is available elsewhere at a lower cost, why not take the 10th no for an answer and why try to hide the fact that there is a rather expensive hidden catch if you do take on the insurance and then why pretend you didn't say no at all. Hardly a way to sell your product. Oh I forgot the threat that if I didn't accept the loan there and then the interest may go up before I had bought it.
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