Charges on a Loan Account

HelpWhereIcan

Hi all, wondering if you can help answer a question for me.

I have a couple of clients who have been in a debt management plan for the last 7 years and have noticed that the balance they owe on one of their creditors has actually risen.

It is a personal loan with Paragon where the balance has risen from 12000 to 17000 over last 7 years. I have advised that they contact Paragon (rather than the debt management company) to find out why this is.

If it is due to account fees and late payment charges, would they be able to claim them back under the 'bank charges' process?

ie does it apply to loans as well and bank charges and credit cards?

Thanks

Twinkly

HelpWhereIcan wrote: »

Hi all, wondering if you can help answer a question for me.

I have a couple of clients who have been in a debt management plan for the last 7 years and have noticed that the balance they owe on one of their creditors has actually risen.

It is a personal loan with Paragon where the balance has risen from 12000 to 17000 over last 7 years. I have advised that they contact Paragon (rather than the debt management company) to find out why this is.

If it is due to account fees and late payment charges, would they be able to claim them back under the 'bank charges' process?

ie does it apply to loans as well and bank charges and credit cards?

Thanks

They can reclaim late payment fees yes.

As for 'account fees' I couldnt advise further without knowing what they were for. The basic rule applies as per the Unfair Terms in Consumer Contracts regulations that they cannot charge in excess of their costs. Loan accounts are governed by the same regulations as bank charges and credit cards so I would assume any high unexplained/irrational charges are certainly questionable if not reclaimable.

Hope that helps

HelpWhereIcan

Thanks Twinkly

They are going to be writing to Paragon to get a statement of charges made and hopefully they will get somewhere.

I find it appalling that someone who has made an arrangement with a lender in good faith following genuine hardship should see their balance rise by 50% despite sticking to the arrangement.

Hopefully they will get a result and I'll keep you posted.

Thanks Again