I have a 19 year unsecured loan - Is this legal?

rooster1973

I took out a £6600 unsecured loan back in 2006. It was running alongside my mortgage but was seperate to my mortgage. It is an unsecured loan currently at the variable interest rate of 4.78% but previoulsy was up at 6 or 7%. It currently is only £45 a month but it still has 13 years to run. I was thinking of paying it off and it will cost £5300 to pay it off today even though I have been payying it for last 6 years. I was thinking is this loan legal or should I have been sold this ? Any advise would be appreciated. I know that these type of loans are no longer offered. I have a mortgage with the same company and it runs alongside the unsecured element. At the time the mortgage I wanted was £6600 higher than they could give me so they gave me an unsecured loan alongside it.

Thanks in advance

Apples2

Seemed entirely acceptable when you were applying and taking the money, what has changed now?
Is it a case of being bored with repaying?

DCFC79

rooster1973 wrote: »

I took out a £6600 unsecured loan back in 2006. It was running alongside my mortgage but was seperate to my mortgage. It is an unsecured loan currently at the variable interest rate of 4.78% but previoulsy was up at 6 or 7%. It currently is only £45 a month but it still has 13 years to run. I was thinking of paying it off and it will cost £5300 to pay it off today even though I have been payying it for last 6 years. I was thinking is this loan legal or should I have been sold this ? Any advise would be appreciated. I know that these type of loans are no longer offered. I have a mortgage with the same company and it runs alongside the unsecured element. At the time the mortgage I wanted was £6600 higher than they could give me so they gave me an unsecured loan alongside it.

Thanks in advance

Youv'e had it for 6 years so must have been ok with it till now.

rooster1973

Apples2 wrote: »

Seemed entirely acceptable when you were applying and taking the money, what has changed now?
Is it a case of being bored with repaying?

Not bored with it. I was struggling financially at the time so had no choice but to take it. I always knew it was a bad deal as would end up paying double I got over the term. I always wanted to pay off once I was on my feet again financially. Now in a better position so going to pay it off. At the back of my mind I thought I had heard on the radio that some long term unsecured loans were miss sold or not correct, hence this type of loan was off the market these days. No harm in asking!

R_P_W

Doesn't sound like a case of mis-selling as you say you knew what it would cost you and knew it wasnt the best deal.

If you are only paying £45 a month then it is going to take you 13 years to pay it. You say it will cost you £5300 today to pay it off. If you keep paying 45 quid a month for 13 more years it will cost 7020 - appreciate my numbers are a bit simplistic, but if it costs you less to pay now than what you will pay over 13 years its a no brainer to me.

dealer_wins

Maybe you mis-bought the whole package. Why dont you sell your home and pay it all back.

broad-sword_2

Just a general rant, but what is this obsession with being missold just about everything? Does the salesman say 'look over there', and then sign your name whilst you're distracted? No, 99% of the time most folk will sign anything to get anything, and then later look for someone to blame. As for PPI......

Tixy

Sounds like a Northern Rock Together package - yes they are legal. A lot of people have them (I expect other banks may have done a similar deal but certainly NR did a lot).

They certainly were not a great deal for many people - but only in the same way as buying a house with a a very high LTV is not a good idea - but many many people did that as well rather than save up a decent sized deposit first.

SnowTiger

rooster1973 wrote: »

Not bored with it. I was struggling financially at the time so had no choice but to take it. I always knew it was a bad deal...

So you got involved in something you thought was illegal? Bet you're relieved it's not. It must have been preying on your mind all this time. :rotfl:

DevCoder

It's legal, you consented, you were not forced to take the loan.

Pay it back

Apples2

Tixy wrote: »

Sounds like a Northern Rock Together package - yes they are legal. A lot of people have them (I expect other banks may have done a similar deal but certainly NR did a lot).
.

Good spot, we had one of those a little while ago.

OP, take heart that your tale of woe is pittiful compared to this couple where their £26k loan turned into £85,000

https://forums.moneysavingexpert.com/discussion/4003181