Bank increased standing order for loan

lisajane8482

Hi,

I'm hoping someone will be able to give me some advice. My dad has a loan with Yorkshire bank (who his bank account is also with) and due to redundancy last year couldn't keep up the payments. Long story short he now has a job and had (he thought) come to an agreement to pay back the arrears. They agreed to set a standing order For a set amount each month but when they have taken it this month they have increased it without his approval.

He's tried ringing the bank and is waiting for someone to call him back, but in all honesty they seem like a useless bunch of w**kers.

I just wondered where he stands legally and if he can claim the extra they have took back since the agreement was for a smaller amount. What would be the correct procedure to follow when this happens?

Any advice would be greatly received.

dancingfairy

Are you sure he set up a standing order and not a direct debit? A direct debit would give the bank authority to change the amount (as long as the correct notice has been given) but a standing order has to be changed by the customer.
In theory you should be able to make a claim under the direct debit gurantee but whether the bank will accept their error and reverse it is another matter altogether.
It may well be a case of one part of a department not knowing what the other is doing. Does he have the payment plan in writing at all?
If he gets no joy with the direct debit guarantee he should ask the bank for a copy of their complaints procedure and then follow that. It will need to be all in writing. This should shake them into action, if not then he then has the right to go all the way to the ombudsman if neccessary.
Also does he have insurance cover or anything that might pay out due to the redundancy?
Hopefully the bank will sort this one out promptly but if not he might need to consider opening up a bank account with a new bank/building society as unfortunately there are rules which mean that a bank can dip into someone's current account to pay off a debt that is owed to them (let's hope it doesn't come to that).
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mogsi80

Oh that's awful, unfortunately your dad should've changed banks to avoid those "charmers" doing the exact thing.

Has he tried going into te branch and speaking to someone there, rather than get fobbed off on the phone?

taffy056

They are not allowed to increase standing orders at all from what I can understand. This sounds like a direct debit, and they are supposed to take what has been agreed, the problem he has if this not in writing its difficult to prove what's in place. Probably a complaint is in order with this, and the direct debit guarantee should be used IMO

busyladee

Having a current account where you have debt can give the provider the Right to Offset - where they can use the funds in your current account to pay off what's owed. I'd suggest your dad switch to another bank for his normal account