Loan Rip OFF

amccoy

Hi Guys, Hopefully someone can help or even point me in the right direction. I took a loan out of £25,000 secured on my home in 2006, now todate I have repaid over £16,500 but when I got my statement in I still owe £25,200 (not exact) but more than i borrowed! I have written to them to say this is crazy, obviously what they have done is loaded the loan with 20 years of interest up front and basically they say I will be paying back £75,000. Unfortunately they where not registered with the Financial Ombudsman until June 2007, although the company say they are regulated but failed to say who by. Really I think i was given the wrong information about this loan, I thought I would be paying the loan and interest, giving me the option to pay it off early, but it seems I have paid over £16,500 in interest only. Please help

boobies

You did read the paperwork when you took out the loan, didn't you?

Tixy

Have you got your copy of the agreement? if so what does it say? what APR are you paying? is it fixed or variable? have you always kept up to date with repayments? Does the loan have PPI on it? How long was the term?

amccoy

Hi, Thanks for the reply,

Yes I read the paper work, but you know what that is like, the size of a telephone book with things you really dont understand.

I still have the paper work, the apr is or was around 13% over 20 years, i assume it was variable as it has went up my payments, there was no ppi attached to it, and I have never missed a payment.

i was just hoping to pay this of early or even put lump sums towards it, but it seems that any payment i make will be swalloed up in interest.

amccoy

Just to add,

I have had loans before and of course I know that if you take them out for say 5 years then you will be paying back the full amount, if you pay it out over the full term, but it they have taken the interest first, thats my complaint.

XXSCOTSLASSXX

amccoy wrote: »

I still have the paper work, the apr is or was around 13% over 20 years,

20 years thats where the problem is, its in effect a mortgage all be it on 13% ouch.... purchased my 1st house years back and sold 3 years later paid more back to the mortgage company than had originally borrowed .... unfortunately taking over such a long term there is a price to pay do they allow overpayments each month that would bring it down quicker......

amccoy

XXSCOTSLASSXX wrote: »

20 years thats where the problem is, its in effect a mortgage all be it on 13% ouch.... purchased my 1st house years back and sold 3 years later paid more back to the mortgage company than had originally borrowed .... unfortunately taking over such a long term there is a price to pay do they allow overpayments each month that would bring it down quicker......

Hi, I am sure they do but my fear is that they will take that in interest and that i will be paying back £75,000 if it takes 5 years or 20 years.

I just think that it was not made clear to me that I will be paying interest alone for the first how many years.

Wutang_2

amccoy wrote: »

Unfortunately they where not registered with the Financial Ombudsman until June 2007, although the company say they are regulated but failed to say who by. Really I think i was given the wrong information about this loan,

Where are we going here?

amccoy

Wutang wrote: »

Where are we going here?

What do you mean??

Are you asking what is it that I want?

Well i want to know do I have a case, I have never had or heard of a loan like this, I have had loans before and paid them back early and only paid the interest for the time I have had the loan, my payments to them was interest and capital, which brought the loan down every month.

So my question is do I have some sort of case against them?

Tixy

What does your paperwork state about the loan? about early repayment, about front loaded interest etc?

We cannot possibly advise without knowing what the loan agreement says.

XXSCOTSLASSXX

i wouldnt have thought so ..... if u look at any mortgage and calculate the interest over the term it would make ur hair curl and we would all have a case ..... its a secured loan over 20 years.... what are the min payments each month?