Cahoot flexi loan APR increase AGAIN!!

paulcornwall

I am totally disgusted with Cahoot my apr has changed 2 times in the last 6 months, originally at 9.3% now 19.9%, totally unacceptable for such a dramatic increase. I'm totally aware the APR can flutuate but there taking us for a ride.

dudleyboy

That really is a shocking increase! Any chance of paying it off early with a lower APR fixed rate loan from elsewhere?

mrcow

That's what they want. Cahoot have stopped offering news loan now.

The best bet is to:

a. pay it off
b. get it onto a 0% credit card or eg. 4.9% for life of balance
c. transfer it to a lower rate loan (and pay it off!)

Sweet_FA

I too have received the good news from Cahoot. I opened my Flexible Loan account with them in January 2003. At that time the APR was around 7%. At the same time, the Bank of England Base Rate was 4.0%.

Cahoot now tell me that from June 26th the APR on their Flexible Loan will increase to 19.9%. So over the last 4 years, although the Bank of England Base Rate has risen by 1.25%, Cahoot's APR has risen by around 10 times this amount!

There is additional good news in the email. From the same date the minimum payment will increase from 2% of the outstanding balance to 2.5%. This minimum payment percentage has also increased over the years. Initially this was 1.75% of the outstanding balance. As I have a fairly large loan with Cahoot, this will mean an additional payment for me of around £40 per month.

Cahoot have the audacity to state in their email, 'As a responsible lender, we have increased the amount of minimum repayment to ensure that customer balances are reduced by a reasonable level each month'.

I too am totally disgusted with Cahoot. I am considering writing a letter to Cahoot to challenge the above changes. Although legally they can alter the terms & conditions of the agreement, surely any alterations have to be fair. Is it fair for a bank to increase its APR on a loan from 7% to 20% when interest rates have only risen by 1.25% over the same period?

brightonman_2

I too received an email from Cahoot this evening telling me that they are increasing the rate on my flexible loan from 14.9 to 19.9%. Yet another deplorable example of big bank bullying tactics.

I used the online 'Contact Us' facility to register my complaint -- that it will make any difference is of course unlikely. But I've made it clear that as a long-term customer, I'm disgusted to be treated in this way, I demand an explanation for their actions and that they reverse their decision immediately. I also tried calling them, but their phone desk closed at 8pm -- how convenient that they should have sent the email out at 7.52pm, then!

Of course, if I were able, I would transfer my balances -- but like many here, I'm in the process of just really getting to grip with debt, and whilst I've made significant progress over the last six months or so, I just don't have the wherewithal to just dump the debt elsewhere.

But as someone who is also an Egg customer -- and just look at what they've been up to in the last 12 months -- I've now developed a seething anger about the financial institutions in this country and what they seem able to get away with.

I was brought up, like most of the population, to trust banks.

Never again. :mad:

brightonman_2

This is the email reply I received to my complaint this morning:

"Thank you for contacting cahoot in Coventry.

We have undertaken a significant review of the cahoot flexible loan account, part of this analysis looked at the rates on this account against the rest of the flexible loan market and the increased costs of a flexible loan account.

On a typical loan size of £3000 paid over 48 months, you will only pay around an extra £5.32 per month. We think the cahoot flexible loan account has some unique benefits that allow you to manage your loan - take more money from your credit limit as and when you want and repay more without penalty.

cahoot no longer offer new loans. So if you would prefer to take a fixed rate loan, as we are a trading division of Abbey, they may be able to help. Please call 0800 389 4158 for more details. Abbey is available 8am to 9pm Monday to Friday; 8am to 4pm Saturday and 10am to 4pm Sunday.

If you have any further queries about your cahoot account then please let us know."

What a cop out! So in effect, they're saying "if you don't like it, go elsewhere." Their attempt to justify the increase is laughable!