Re: Loan problem.....

uncertainsurrey

Hi All

Nearly 2 years ago when I was experiencing some money problems and the bank charges were snowballing I asked the Bank for an addition to my overdraft to help me out and to stop the charges. The Bank said no they were not able to extend my overdraft but instead would refinance my Loan which reduced my payments by £60 a month and cleared my overdraft and charges! It also meant writing off the money I had already paid off the Loan and having this new Loan for 10 years instead of the original 5 years (which I was 1.5 years into)..... It wasn't the best decision I had ever made to agree to, however at the time there was no other option.

I have just started the process to claim back my Bank Charges and if successful I would like to challenge this Loan arrangment. Having gone through all my statements for the last 6 years, I discovered the month I agreed to this new Loan I was £231 over my overdraft limit and within the 30 days leading upto the new loan I took out I had paid over £300 in Bank Charges and if that hadn't been the case I would not have needed the new Loan.

I know it was a silly thing to do on my part by agreeing to it but if anyone could offer any practical advice to help me proceed with challenging the Loan if I manage to successfully claim back the charges, it would be very much appreciated.

Thanks.

Rafter

You should certainly claim interest on the charges at the rate of your consolidation loan. That way the loan you took out that you didn't need has not cost you anything.

However, arguing that you should get the whole loan cancelled when you have been £60 a month better off for the last 2 years is a very weak arguement.

If your credit rating allows, you should certainly use the reclaimed money to pay off some of your loan and refinance it over a shorter period.

R.

uncertainsurrey

Hi

Thanks for the response - I don't expect them to write off the Loan - however although I have been £60 a month better off, if I allow the Loan to continue until the end - it means I will have been paying off the Loan for 11 and a half years instead of the original 5 years and for a Loan of £10,600 I will be paying back £23,500. At the moment I have over 8 years left on the loan and with the original loan I would only 23 months left. This is what I want to challenge - I have no problem with the original Loan and feel that although I should pay something - I don't feel that I should have to pay that amount when all I wanted was £300 added to my overdraft.

uncertainsurrey

Can anybody please offer some advice on this as I am really stuck and not sure how to proceed??????

Warriorsith

Have you checked out the consumer action group website, they'd probably have better understanding or perhaps try CAB as am sure they deal with queries like yours.

I think you'll get your charges back but the bank will settle outside the courts. Can the charges you claim back plus the interest be put towards the loan your currently repaying?

Any how, as said check out the places I mentioned they'll have people who can help you there.