HSBC - A Responsible lender?

SteveYoung83

Good morning, first post, long time lurker...
On Monday my grandmother sadly passed away.

Yesterday I went to her house to sort out her affairs.
I was fairly shocked to find that she had an equity release loan from Aviva and owes them £51k . I've no idea why she had that, or where the money from it went, because she also had a credit card from HSBC and another from Sainsburys.
She had a £100 limit on the Sainsburys card, but the HSBC card is really irritating me.

What sort of responsible lender would allow an 80 year old woman that was only paying the minimum amount back each month, but spending double that on the card, to have a £10k credit limit, which she has exceeded!?

I'm in a fairly well paid and secure job, and although I have no want or need for a credit card of that sort of limit I doubt very much I would be allowed to have one in the first place.

So, why has a bank allowed an 80 year old woman to amass such a debt? Her current account is with HSBC so they could see from that what her income was.

Obviously, it will have to be paid from her estate, but I'm amazed at how irresponsible HSBC have been in allowing things to get to this stage in the first place.

* Edit to add -
She also had something called Card Guard attached to this card. Does anyone know if I may be able to go down the PPI mis-selling route?

Hominu

I don't know how your grand mother lived her last few years, but it would seem that she knew her finances, knew the equity held up in her house and decided to spend it. It comes across in your post that you are not happy that this has happened.

Whilst I doubt that HSBC would allow a 80 year to have a 10K credit card, I have seem them offered to 50 year olds, and the credit limit never changed when they entered retirement. So this might be why she had such a large limit.

jamesd

She was 80. Half of women in normal good health at 65 are expected to live to be 89 or older, so nothing wrong with having credit at 80.

HSBC appears to have been quite helpful to her with the credit card, allowing her to spend more than her income allowed near the end of her life, usefully increasing her standard of living.

The equity release loan would be just sensible financial planning. The home is of no value to her when she's gone so she used it to increase her available income while she could benefit from it.

It'd be interesting to know how close she came to managing to die with no net assets at all, having fully used all of her income and assets to improve her standard of living while she could benefit from that.

Card Guard isn't PPI so there is no PPI mis-selling opportunity. There is some FCA concern about some sales of this type of product where it was sold on the basis of the protection against fraud, because the card holder is already well protected against fraud. However, the policy has other benefits and you've no way to know whether the policy was in place for some of the other benefits, so no way to assert that it was a mis-sale.

opinions4u

Should old people, with experience of life, not be allowed credit?

shortcrust

opinions4u wrote: »

Should old people, with experience of life, not be allowed credit?

Exactly! People don't cease to be adults after a certain point. She probably had the HSBC card for years and it would have been outrageous for them to reduce her credit limit simply because of her age. Banks don't know people's income. Lots of folk have accounts with many banks with different payments going in. Some have savings or cash income that their current account providers don't see. As long as she was making the required payments they would have been, quite rightly, happy.

I can imagine it's frustrating that there's less money than you expected but it simply sounds like your grandma decided to enjoy it whilst she could. Good for her!

lisyloo

What sort of responsible lender would allow an 80 year old woman that was only paying the minimum amount back each month, but spending double that on the card, to have a £10k credit limit, which she has exceeded!?

She seems to have the assets so what's the issue?

I'm not being judgmental but perhaps you should ask yourself whether your vested interest is clouding your judgment.

None of the rest of us here have an issue with her spending her illiquid assets (home) whilst she was alive and could enjoy a slightly better standard of living.
The bank provided her with a mechanism for doing that (at a cost of course but they aren't a charity).

If she was vulnerable e.g. dimensia then should family have taken a greater interest?

Obviously I don't know the full situaion but jsut throwing a few things out there.
I have a slightly vulnerable MIL (dimensia).
I help her with all her affairs whilst trying to allow her freedom to amke her own decisions.
I'll be absolutely delighted if she manages to spend all her money before she dies and there's nothing left for anyone else - including me.

Neilhmtn

Don't know why the OP was shocked. From the information presented here, it sounds to me like this grandmother was an astute lady.

Gromitt

Indeed, it seems that she had financial sense. If she was living on the basic state pension, had no partner, and the house was fully paid for, why not take out an equity release loan to increase her standard of living ? Likewise, she knew the credit card would be paid from the sale of the property.

I would be very happy if my grand/mother did like wise and maximised her assets to improve her standard of living rather than saying that she can't afford to have the heating on and staying in bed to keep warm.

Of course I don't know the full story, but from your post it sounds like you had already made financial plans and these plans have been disrupted because of your findings.

zerog

I certainly hope that my credit limit in 60 years' time will be several million pounds / euros / dollars

k12479

SteveYoung83 wrote: »

So, why has a bank allowed an 80 year old woman to amass such a debt?

Maybe there were no family members around to help her look after her financial affairs.

rabbit_burrow

Firstly, and most importantly, I would like to send my condolences to you on the loss of your grandmother. x

But, I have to say, that her money really was hers to spend. Whether it was responsible in your view or not really doesn't bear much weight I'm afraid, though you could try to argue the case with HSBC should you so wish.

Fact is, can you pay her debts with the remaining equity in the house? If the answer is yes, then I'm afraid I don't see the problem. It was her money, her equity, her choice on how to spend it. Does it sound harsh? Yes. But we are not entitled to inheritance, we are blessed if we get it.

I hope you can give yourself the time you need to grieve for your loss.

x