Secured Loans: cheapest lending of last resort

andy61_2

I would like some advise on my secured loan which i am having trouble keeping the payments up, I pay £1020 per month but over the last few months missed some payments, I just dont know how to cope with all this and not sure what to do.

Anyone please help.

Andy

regularsaver1

have you spoken to the lender?

dsack

Hi all, im trying to sort out my mums finances as she is now retired/partime has no mortage an wants to borrow 25000 over ten-15 years to pay of loans outright an home improvements, the repayments on a single loan should be better, does anyone have any advice as to what the best route would be to take in this case? Ive heard my mum mention "life mortage" an have kinda looked into them but the idea doesnt sound in the consumers best.. any advice on this matter would be most welcome..Thanks

chancer10

I made the mistake of taking out a secured loan with First Plus back in 2001 for £49,000. £9,000 of that was the PPI that was sold to me as a savings plan!! I had to keep the loan going for 5 years before I could get this back in the form of a cheque.

My question is in 2004 I paid £40,000 of the loan. It still left some to pay as I did not want to pay all the loan off and lose the chance of getting the £9000 back. What I was not told until I complained about the final settlement figure in 2006, was on the same day I paid off £40,000 they charged me £5,000!!

I was never advised of this and only ever received a letter telling me my new monthly payments. I have complained to the Finance and Leasing !!! but to be frank they were of no assistance as First Plus just ignored them, they have also ignored me since Jan 07 after giving me the run around for two months(since Oct 06). To date they have not explained how they come to the £5000 figure and there was nothing in the Data Protection information I received from them, I have never even been given a statement.

The customer services Dept at First Plus is utterly Cr***.

I know the procedures in respect of getting bank charges bank as I have done this with Abbey, but have I got any case with First Plus in respect of the £5000? I am aware of the 78 rule, I could do with some feed back.


Thanks

alexpoirot

Having taken out a secured loan (now repaid, by taking out another-doh!) and defaulted on 2 payments, were charged 2 x £600 legal fees,and £30 per phone call and letter, plus on two occasions we requested a figure for repaying the loan and were charged c.£700 and c.£900, just to know the price of repayment? Surely these charges are illegal in the same way as Bank charges...they are as disproportionate? Having sent a first shot letter to reclaim the charges, and a county court pre-summons letter I have had two identical 'thanks but we're doing it by the book, and you did default' letters, which kinda gives me hope that some of the charges may be recoverable, don't want to take on the finance co as cant afford to lose....... anyone got experience..thanks

james_124

hi there, am considering a secured loan at the moment and have applied to 4 lenders to see what terms are available.
I have 15k credit card debts
3 secured loans: 1 owing 15k, (3yrs remaining) 1 owing 9k (2yrs remaining) 1 owing 2.5k (2yrs remaining)
current repayments per month are: 350 credit cards, 700 loan, 700 mortgage, thats 1750 without council tax, and utility bills, apprx 250. Earnings are 2200 per month net. so as you can see it is becoming nigh on impossible to live through the month. I have no ccj's but just a bad credit record, cant get an unsecured loan. If i were to be offered one for 18k (paying off credit cards mainly and council tax arrears), would you think this would be a good option to take, as currently i don't see any other way out.

regards

James

asterisk_2

We had a £16k secured loan over 10years, which we're looking to repay 6 years early but the lender has stipulated that we must pay an additional £1,600 for early redemption charges calcuated on what they would have received in interest if the loan ran to the end of the term. I've read somewhere that to avoid redemption charges we could pay the bulk of it and leave a small amount outstanding. Has anyone else come across this?

Also, I phoned the lender last week and said I was thinking about making a payment to clear the bulk of the loan and asked what would happen to the balance - I was told it would just be cleared early by my normal monthly repayments and there was no mention of redemption charges kicking in. Did this person not know what they were talking about -I'd hate to do it and then find out they can hit us with the redemption interest anyway?

lisacmitch98

Hi All

A word of warning -If you already have a secured loan with payment protection and are contacted by the company offering more money for no increase in terms please do not get caught out. I used to work (For 5 months) for a secured loan company and the company would telephone the customer after a year to ask them if they would like to borrow more money. A lot of people take up this offer, however it's not as great as it seems. Instead of adding the extra cash onto the existing loan, the company would raise a new loan with new payment protection. That new loan would be used to pay off the existing loan along with the interest penalty for paying a loan off early. In addition to the exisiting loan being paid, the remaining payment protection would be paid off (without rebate). Therefore the customer would have paid for 5 years payment proection which would then be cancelled and then they would be charged for a further 5 years protection. The company would be very cagey about telling the customer this and hence there were many customers that had shelled out in excess of £5000 for something they could not use. Also something to be aware of when taking out a secured loan is exactly how much interest you would be paying back. It looks quite a good deal sometimes but when you calculate the daily interest that is added to the loan, a lot of the time the customer ends up paying back almost twice what they borrowed.

bravemanscotland

especialy First Plus come and join our campaign

JonnyDisco

I have regularly popped into the MSE forums over the past few weeks looking for information and there seems to be at least a few people who know something about what they are on about, so I’ve registered today and I was wondering if anyone has any comments and advice on my current situation. Apologise if it seems a bit long, I suppose I’m trying to draw you a picture.

Won’t give you all the in’s and out’s of why’s, wherefore’s and reasons but I am where I am…… Been having my lightbulb moment for a few weeks and not sure which path to enlightenment to take.

A few years ago I got divorced and ended up in a bit of a state, work went downhill (self-employed) and through illness ended up taking about 9 months off to pull myself together, finalise my divorce (ended up with nowt apart from my LG pension from a previous job), eventually moved back to my parents taking time to start all over again.

Things were cool for a while, bit of rest and relaxation but could sense there was something up with my folks especially my dad and within a month or two found out by chance that he was about £7k in arrears on his mortgage with the Lambeth. So with the small amount of money I had left over set about arranging with the Lambeth a repayment plan, got myself some work and started all over again.

Due to my illness and not working, I could not repay my £1500 Business Overdraft with Lloyds (which subsequently increased to £2,028 with default charges, no I had no insurance) and my personal bank account with them was closed owing £788.

At the time I also had a Capital One card with a £200 limit on for personal purchases on the net which I used about 10 times, clearing the balance some months but eventually it went up to the limit (well £196). There’s a whole other story around what happened to this debt but I ended up with a default for £2151!

About 2 months after I had started work again, my dad (64 then) went off sick from work (only on SS pay) and could not afford to keep up repayments on his mortgage, my mum was retired (76 then) so I agreed to fund his mortgage payments and the arrears totalling approx £650 a month (paid through my bank to Lambeth) until such a time he goes back to work and saying he would give me back what I’d paid, not sure how he was going to do that but hey ho as they say, its family.

I made my somewhat revised life-plan to clear my debts, save up over the next few years so I could start a new business again at the end of my 3 year contract (April 2007)and get back on life’s windy road….

Well, that was the plan…..

During that time and 3 years later…..

• Managed to reduce my debt to Lloyds to £1,777 and £557 by minimal payments, ok, missed a few as well
• Reduced my debt to Capital One by £75 before deciding to totally dispute the extortionate cost of the original £196 debt which still continues to this day
• Paid over £20k on my parents mortgage (together with countless other bills) and my dad is now permanently signed off work and will not work again due to an industrial disease, of which there is a potential claim going through court at the moment
• Met a lovely lovely lady and some how managed to dwindle the money I had been saving up to raise the £15k I needed for my new business venture
• Got misled on my final pay day and ended up spending virtually £1300 over my agreed overdraft limit. With all the additional costs and charges has now left me with a debt of £2,700 with Natwest (although I am potentially looking at a claim for charges of about £1,700 if it’s a road I go down)

Back to square one…..

Contract finished, no money left to start new business, got blown out for a job it was inferred was mine and finding it tough to secure work in my line of business as it is very competitive and 3 months arrears on the mortgage again although not directly my responsibility as my name is not on the mortgage.

I really was geared up to starting my new business as soon as my contract finished and as you can tell has not worked out and have projected a requirement for £15k to set-up and commence trading with 2-3 months.

My Dad has suggested whether I could look for some sort of Business Loan to fund the set-up and has indicated some sort of willingness (not sure what he means by that) of offering security of the loan against his home which currently has about £100k worth of equity considering I have paid his mortgage and debts for the last 3 years. Can anyone advise whether this is possible given the circumstances?

I said the problem would be their ages and following a call to the now Portman Building Society as their existing lender (before the arrears started) and they have refused to look at this given their ages.

Is it conceivable the loan could be in my name and secured on their home? No idea if this is right. Obviously there are some serious considerations securing against the home but as they have no real form of income to support paying the remainder of their mortgage (approx 6 and a bit years) and are probably leaving to me to sort out.

Another option I have been looking at recently is to clear the existing mortgage and clear commitments for them through an Equity Release Plan.

I have made some prelim enquiries and potentially they could raise £45k on a £140k house, pay off existing mortgage approx £25k and £10k on a Charge Order made against him for his credit card debt, leaving them clear of about £10k. By the time they have finished messing about this will be down to about £6k. Not much to hand back after paying over £20k on his mortgage, hey ho again but at least there’s no mortgage as such for them to be hassled with. I get some work, save up again and pay off debts which will probably take 12-18 months.

Trouble is I am concerned with the ER Plan route (which my mum prefers for some reason) as losing a considerable amount of equity together with potentially high early repayment charges if work goes well and we chose to opt out of the plan early. The interest on the £45k will double over say the next 10 years (i.e. £45k borrowed means £90k owed) not taking in consideration any market price increases of property over this period, which we all know were we are now, a potential slowdown.

As I said, if we could continue to service the mortgage payments with possibly some over payments over the next few years if things go well, within a few years this could be paid off and we retain 100% value of the property for them to pass on to the grandchildren, if’s and but’s. Repayment of a £15-20k loan over 7-10 years works out considerably less than the option above.

Also as I mentioned earlier, there is potentially a claim going through court at the moment (which may rack up to a sum approx £20-25k) for my dads industrial disease but I have said to him he really can not rely on this as this is a matter for someone else to decide but if successful could go some considerable way to clearing off any outstanding amount on his mortgage.

Oh well, I think I am about done….picture painted now I just need to await any advice that may be given as its all going round and round in my head going nowhere. Grateful in advance for any comments and suggestions you have.

Much appreciated