studio 24 service charges

MissSophie9013

I am having alot of trouble with this company and wonder if anyone can help me, I am desperately trying to pay off my catalogue bill but I am finding it difficult as every month they are adding "service charges" it states on my statements that if you pay the minimum payment every month it will take longer to pay but I pay more than the minimum payments, example last month I paid 27.00 and was charged £10.84 so I am never getting my payments down. I have contacted them via email but haven't recievee a reply as yet.

As anyone else had trouble with them or as anyone got any advise with what to do next because I know that they are going to try fob me off with some rubbish.

[Deleted User]

MissSophie9013 wrote: »

As anyone else had trouble with them or as anyone got any advise with what to do next because I know that they are going to try fob me off with some rubbish.

Are you sure these "service charges" are not the interest on the outstanding amount? The interest will be a percentage of whatever you owe and will continue to accrue each month.
However, if you are in arrears with payments or pay later than the agreed date then they will also charge and this may account for your confusion.

You need to clarify with Studio 24 in exactly what circumstances they are charging you.

MissSophie9013

Moneyineptitude wrote: »

Are you sure these "service charges" are not the interest on the outstanding amount? The interest will be a percentage of whatever you owe and will continue to accrue each month.
However, if you are in arrears with payments or pay later than the agreed date then they will also charge and this may account for your confusion.

You need to clarify with Studio 24 in exactly what circumstances they are charging you.

It just says service charge on my statements, no it wasnt paid late it was actually paid nearly a fortnight early this is why I cannot understand why Im getting charged. Having looked at various different forums ive come across a lot of other people who have had the same problem, seems impossible to pay it off with these charges.

misschicken

It's interest on the money you still owe them. Paying more than the minimum is good because it reduces the debt quicker but it doesn't mean they won't charge you interest on the debt still outstanding. I don't know what their interest rates are but I'm guessing they're between 20-40%. If you have any way of doing it I would try and get a CC with a 0% balance transfer deal and pay off the Studio24 card or if you have any other lines of credit with a lower interest rate then transfer it there if you can. They're obviously a bit rubbish at communicating if you do get through to them ask them if there is a way of reducing the interest rate - sometimes paying a different way can do it.

[Deleted User]

misschicken wrote: »

I I don't know what their interest rates are but I'm guessing they're between 20-40%.

I've done a bit more research and here is Studio 24's own definition of their "service charge"

Studio24_webite wrote:

Under the credit terms you will receive a statement every 28 days. You may choose either to pay the full balance on your account at once, or by instalments. Should you choose to pay in instalments, you may pay any amount of your choice above the minimum payment detailed on your statement. A service charge of 3.1% (2% if made by direct debit) of the brought forward balance, plus a daily interest charge for any items that have been despatched in between your statement dates, will be added to your next statement. The minimum service charge is £1.00 on all balances brought forward from the previous statement.
http://www.24studio.co.uk/ss/help/websuite_faq.jsp

So there is no "fobbing off with some rubbish", it's just a legitimate way of adding interest to the Op's account each month. This is why they say it will take longer to conclude if the OP pays only the minimum amount or just over each month.

MissSophie9013 wrote: »

I cannot understand why Im getting charged.

You are being charged for the credit facility you are effectively taking advantage of each month by not paying the full amount owed. I'm afraid they are not doing anything wrong and you must allow for a large proportion of anything you pay to also have interest deducted.
By opting to "spread the cost", you have effectively taken an expensive loan.
I don't know your financial situation, but it might be worth approaching your bank (if you have one) about a personal loan for the amount you owe this firm and paying it off at a far cheaper rate of interest.

If you are experiencing debt problems generally, you might want to go to the Citizens Advice Bureau for free and impartial help.