M&S 6% Loan misleading advertising

Jack_Frost_2

I applied for a loan with M&S Money at their advertised rate of 6%, which I felt was favourable. I received a letter today saying I have been accepted but when reading the small print on the contract noticed that it was at 11.4% :eek: I phoned them to ask the reason why and just got told that due to my personal circumstances that was the rate they would offer to me and that the low rate was not guaranteed. I saw no mention of this anywhere when I applied for the loan, and the covering letter with the contract also does not mention it or the fact that I was going to be charged a higher rate. I find this very very very misleading, and totally wrong.

somethingcorporate

They only have to offer this rate to 51% of successful applicants - it says representative rate not actual rate.

YorkshireBoy

Somewhere in the paperwork or on their website they should define "representative" as that rate which will be given to at least 51% of successful applicants. Do they?

The first page of the online application form states...

Credit and interest rates

Credit is subject to status. The rate we offer will depend on our assessment of your circumstances.

...which gives a clue that you're not guaranteed to get the representative rate advertised.

DCFC79

Jack_Frost wrote: »

I applied for a loan with M&S Money at their advertised rate of 6%, which I felt was favourable. I received a letter today saying I have been accepted but when reading the small print on the contract noticed that it was at 11.4% :eek: I phoned them to ask the reason why and just got told that due to my personal circumstances that was the rate they would offer to me and that the low rate was not guaranteed. I saw no mention of this anywhere when I applied for the loan, and the covering letter with the contract also does not mention it or the fact that I was going to be charged a higher rate. I find this very very very misleading, and totally wrong.

Just chalk it up to experience,

somethingcorporate

YorkshireBoy wrote: »

Somewhere in the paperwork or on their website they should define "representative" as that rate which will be given to at least 51% of successful applicants. Do they?

The first page of the online application form states......which gives a clue that you're not guaranteed to get the representative rate advertised.

If you check the website it says representative EVERYWHERE!

YorkshireBoy

somethingcorporate wrote: »

If you check the website it says representative EVERYWHERE!

Yes, but it sounds like the OP hadn't twigged what it meant. All credit card providers clearly explain it, so I'd be surprised if M&S don't with their loans too.

I wonder if, under the old 'rules', OP would have known what "typical" meant? Maybe they would have stood a better chance there because that was 66%.

somethingcorporate

To be fair to the OP, I did have a couple of minutes surfing their loans website and couldn't see an explanation of what they meant by representative.

YorkshireBoy

somethingcorporate wrote: »

To be fair to the OP, I did have a couple of minutes surfing their loans website and couldn't see an explanation of what they meant by representative.

Me too (our post times would suggest I spent 7 minutes searching!). That's why I questioned the OP.

Jack_Frost_2

Also to be fair to me this is the first time I have applied for a loan in over 20 years! And no I did not twig what 'representative' meant and there is no explanation of it. Although in hindsight maybe I should have checked it out elsewhere...like here! Yes I will put it down to experience and forget the loan. I just think a lot of people, less savvy, will get caught out by this.

YorkshireBoy

somethingcorporate wrote: »

To be fair to the OP...

And again here...

If you type "representative" in the 'ask Hannah' virtual assistant she replies "I'm sorry I don't understand".

There is a FAQ "What is your Personal Loan typical rate?", which would suggest the help files are very much out of date!

LovelyLeeds

Jack_Frost wrote: »

And no I did not twig what 'representative' meant and there is no explanation of it.

I couldn't agree more, it's very slick marketing and of course they also 'hope' that you don't notice the hike they impose. Of course people will argue that you should read the T&Cs - but hand on heart - how many of us really actually read every single line, let alone actually understand it.