Stupid Secured Loan

kalk

Looking for advise here. I took out a secured loan in February 2005 to consolidate various borrowings. I missed a payment (my fault) so the loan company got arsey and threatened me with a repossession notice. It was an oversight on my part so I have made the payment but what's doing my head in is that I have made approximately 96 payments to this lender £605 per month. Lets do the math shall we:

96 x £605 = £58,080

We borrowed £45,000
They added £10,000 (PPI - yes there is a claim going through)
Total £55,000

The repossession notice claims I still owe them £51,000

How the hell can I STILL owe them £51 grand when I have already paid nearly £60 grand !!!!!!

What can I do????

Dave101t

let them take you to court, you have the receipts. counter sue for emotional distress, and company badgering of vulnerable persons.

zebedeeuk

Have you included interest in those numbers?

jaybeetoo

kalk wrote: »

How the hell can I STILL owe them £51 grand when I have already paid nearly £60 grand !!!!!!

What can I do????

How long was the loan originally for?

What is the interest rate?

antrobus

kalk wrote: »

...How the hell can I STILL owe them £51 grand when I have already paid nearly £60 grand !!!!!!

Because the interest rate on the original £55k loan is about 12%, so most of what you've paid so far has been interest? (I don't really know, it would depend on what rate you borrowed at, but it would be something like that.)

kalk wrote: »

...What can I do????

Proceed with the PPI claim. £10k plus 8 years interest at 8% should make a sizeable dent.

StuC75

How long is the term of the loan - 45k would suggest something like a mortgage (20yrs say). Which combined with the interest rate - which for such a term may be a variable rate? so may have increased.. what does the agreement show?

FiatFan_2

sounds about right if you borrowed over 15yrs, total borrowing 109K including interest. pretty shocking what seems like a good idea at the time, done the same myself with firstplus

Teen_the_Drama_Queen

Snap FiatFan, ah yes good old Firstplus, when we stopped our monthly payment as we were about to go BR, they loved us so much they rang us about 6 times a day

kalk

Thanks for comments guys.

The borrowing was originally for 15 years, I'm digging out the paperwork to find out what the interest rate is.

I know I have a way to go yet but it feels like I'm bending over the table everytime a payment goes out my bank account at the moment.

I'm thinking we should wait until the PPI and interest claim comes in to put as bigger dent as possible in the amount borrowed and then either take the balance and remortgage (we have equity) or renegotiate, increase the repayments and reduce the term, pay more and get rid of it as quickly as possible....?

FiatFan_2

Is yours with firstplus?

iirc our payments started about Feb 05 too and similarly borrowed about 45-48k over 15yrs, + PPI which gave us a repayment of about the same. When we remortgaged about 2008, they (firstplus) relieved us of 20k through the remortgage which reduced our payments to £495 over the remaining period.

We tried not to take PPI on it from the outset, but were told it was a necessity but only for the first 5 years where we would be reimbursed with interest. True to the contract they did and think we received about £9900, shame it just paid off further debt that had built up over the 5 years.

jaybeetoo

If you borrowed £55,000 (in total) over 15 years (180 months) and you are repaying at £605 per month, I think your interest rate is about 10.5%.

For a normal loan (e.g. a mortgage) after 96 months I would expect you owe about £36,500.

If you Google for loan calculators you can find several to try and check my figures.

Did you get annual statements for the loan showing how much interest you paid, how much principal was paid off and your repayments? If not, I would ask them for a statement.