Hoping for help

Shepherder

To try to cut a long story short, we have two mortgages on our property. Nine years ago we got into bad trouble moneywise and defaulted on both. As a result we ended up with repossession applications from both companies, which we fought, obtaining a stay of execution.

Thereafter we worked long and hard to clear arrears on both, having made agreements with both companies, and then conducted our accounts faultlessly thereafter for somewhere around six or seven years.

This morning I received the 2nd mortgage statement of account. The amount borrowed was wildly different from the account now outstanding, and I noticed a recurrent charge of anywhere between £75 and £86 happening every month.

I called the company and asked why. They told me that during our bad period we had acquired charges (understandable enough) and then they told me that no payment was applied to them, and that the figure I saw was accruing compound interest, building at the rate of £1000 per year.

I have asked the company to provide me with a full statement of this portion of our account. I really do not understand why they have made no effort whatsoever to bring them to our notice. Our primary mortgage company offered us a good deal after we had handled our account properly for six months. But this 2nd company have not.

I feel sure that somewhere I have read that financial companies are guided not to make debt problems worse for customers who get into trouble, especially where the customer makes a solid agreement for repayment which they then follow through on - but I cannot find this. When I asked the woman on the phone is this was legal she told me "Yes it's compound interest."

Is anybody able to guide me here? I feel quite horrified. This loan is going to have as much outstanding on it when we pay off the capital as it did when we first contracted for it. I accept there could easily be outstanding costs and charges related to our bad period - but should they really still be charging interest on these after six or more years of exemplary conduct?

I'd be deeply grateful for any advice anyone can offer.

ACG

Get the paperwork from the lender.
Check over it.
If your not happy make a complaint in writing informing them that you think its unfair and how you would like it resolved.
They then have to reply within a set period and they will write to confirm receipt of the complaint and tell you their timescales.
If your not happy with that response you can refer it to the financial ombudsman to look at this independently.

Shepherder

Do you happen to know how long that period of time for response is?

Thanks so much for responding.

ACG

http://fshandbook.info/FS/html/handbook/DISP/1/6

-Usually acknowledge within a week.
-Respond within 4 weeks or send out a holding letter advising they need more time upto another 4 weeks
-Final Response informing you that if your not happy with this you can go to the Financial Ombudsman.

Shepherder

Thanks so much for the link.

Are you able to point me in the direction of the guidance I originally read which states (rather than rules) that financial companies should not employ tactics which disadvantage the debtor?

Yorkie1

It's called Treating Customers Fairly, I think.