Barclays interest refund on loan

Busybee5186

Hello all,
this is my first time posting, I have been a lurker and read numerous thread on the boards and find them most helpful,

I have a loan with Barclays, since feb 2011, £5000 over 60 months, repaying at £144.36 pcm, apr 24.177% (ouch! I know, need must!)

I was sent a letter on 6th November 2013, letter below with personal details removed.
" Dear
You now have less to pay on your loan
We've discovered that following changes to the Consumer Credit Act (CCA) on 1st
October 2008 we inadvertently sent a number of customers incorrect information
about their loan and in some cases didn't send information we should have.
According to the CCA, we aren't entitled to charge interest from the time of the
initial error until today when we corrected it. The loan we're referring to is shown
below:

M, loan account number

What this means to you
As we continued to charge you interest on your loan after we made this error, we
have returned this to your loan account by amending your interest rate to 0olo
during this period. The returned interest amounts to f 1,553.92. This means that
you now owe less and your loan will be repaid earlier.

For your records we are also sending all the information that you should have
received about your loan, from the date of our error until today when we corrected
it. The CCA requires us to do this. You'll find the corrected information enclosed
with this letter.

We have enclosed statements covering the life of the loan. These show that the
interest charged on your loan since the error is 0%. They also explain what you
owe.

What do you do now?
You do not need to take any action as we have made all the necessary adjustments
for you. Please carry on paying the same monthly payment; this means your loan
will be repaid earlier. We are sorry for our errors and hope you accept this return of
interest with our apologies.

Get ln Touch
lf you have any questions about what happened, the amount of interest that will be
returned to your account or anything else about your loan, please call us
on 0845 600 4071*. We'll be happy to help."


My understanding of the letter is that they are not allowed to charge interest from oct 2008 to nov 2013 which is when they discovered the mistake. I waited and waited for the £1553.92 to be put into my loan account and nothing. Looking at the loan statement they sent me with the letter, the loan balance on nov 2013 was £2065.84, I worked out with the £1553.92 interest refund, I would pay the loan off by march 2014! I started calling barclays loan 2 weeks ago to ask them when the amount will be put into my account. As my loan statement online says I have £1402.46 left to pay on the loan as from 6 may 2014. I thought barclays will credit £1553.92 into my loan, and the loan will be paid off with some money left over to go into my current account.
After several calls to barclays loan, several people I spoke to claim no such letter was sent to me as it is not on their system, they will look into it/escalate it and get back to me and I never received any call from them. Today I called again to be told that barclays was not allowed to charge me interest for a period of time during my loan (the person I spoke to cannot tell me what period that was and could not put what they told me in writting) and they are not putting a lump sum of £1553.92 into my loan account but instead not charging me interest from november 2013 onwards until the end of my loan which will now be march 2015 instead of july 2016.
I had 3 deffered payment onto the loan extending the original last payment from feb 2016 to july 2016.

Now I am no financial expert, but is this right? The letter leads me to understand that no interest will be charged from 2008, in my case 2011 since my loan was takent out then until nov 2013 when Barclays discovered the mistake.

Anyone else have a loan with barclays and had that letter?

roonaldo

I think you have misunderstood the letter. It doesnt say the error occured in 2008 but changes to the CCA in 2008.

Also £1402.46 is the capital balance of your loan before interest has been applied to your future payments. ie. You were initially going to pay the loan until July 2016 which would have been another(assuming) 25 payments which will total £3609. You now have only 10 payments left totalling £1443.60.

They are not going to put £1553 in your account as you havent paid the interest yet.

It seems what has happened is correct.

Busybee5186

Thanks for taking the time to reply Roonaldo. I just spoke to someone from barclays complaints team and they have explained it so I can understand. Barclays will not charge me interest on my loan for a period of time and loan will be repaid earlier as you said
Also this nice person, gave me £100 in my current account for compensation for all the time I spent on the phone and because several people I spoke to told me something different and so on... I am pleased to be able to understand that letter, they are also sending a new letter with more explanation of how the interest refund works on my loan, and I now have £100 extra to put into the loan, very happy bunny