Any Loan Guarantor loopholes?

AMILLIONDOLLARS

Just one draw back, Latvian Wife is Money Saving Fan! So may decide to keep everything for herself, 100% is better than 30%:rotfl::rotfl:

AMD

Foxy-Stoat_3

ConsumerWizkid wrote: »

Yes there is a loophole.

First, you must conspire an ultimate insurance fraud.

Find a latvian girl willing to get in on the scam, divorce your wife if married and marry said latvian girl and fly her over to live in your house. Make sure the house and contents are insured to the max along with you & your children if any. Get your new wife listed on your life insurance and will leaving everything to her, remove your old wife from said documents and get her to fly to another country preferably outside of any UK or EU law jurisdiction, maybe East Congo.

Then, pay someone to burn down the house, fake the death of your entire family in the tragedy except of course your new wife. Get your new wife to claim on the insurances for a massive payout offering her maybe 30% to keep the deal sweet for her, then transfer the rest to your old wife in East Congo. Smuggle yourself and children to East Congo.

Debt Escaped.

Hanky_Panky

National_Debtline wrote: »

Hi there,

I've not heard of any loopholes to speak of but I will say that the whole notion of guarantored loans isn't something that I'm personally comfortable with unless the guarantor is made fully aware of the potential pitfalls. From anecdotal evidence from our callers, some of these firms do not seem to make clear what the potential ramifications might be. In essence, there is little difference between standing as guarantor and taking out a joint loan with the person in question.

If you were to close the original account you could still be chased for payment. If the lender cannot get hold of the guarantor it may not prevent further action which could include debt collection agencies and possibly legal action.

As an aside, it would be interesting to see a challenge - either via an argument of an unfair relationship under the Consumer Credit Act or possibly an arguement as to the legitimacy of guarantor contracts. I'm saying this as an individual genuinely interested in Consumer Credit issues - rather than the opinion of my organisation, although we do have a large number of callers with concerns over these type of loans.

Best wishes,

David @ National Debtline.

I really do worry about the advice people receive when they go to organisations like yours particularly when I see comments like the one above (embolden).

If you can't see the difference between someone not fully understanding what the ramifications are as opposed to not being told then I do question whether you should be allowed to post as the NDL at all. Have you ever worked on the front line arranging this type of loan for people ? I doubt it.

I have yet to see (and I have seen lots) any loan agreement that doesn't document what the ramifications are, irrespective of borrower or guarantor. I have however seen lots (both as a lender and more latterly as a debt advisor) of people who signed up without thinking past what they were going to spend the money on. It's a fact of life - I don't blame them but equally I'm certainly not prepared to endorse more legislation to try and cater for the lowest common denominator.

National_Debtline

Hanky_Panky wrote: »

If you can't see the difference between someone not fully understanding what the ramifications are as opposed to not being told then I do question whether you should be allowed to post as the NDL at all.

Hello there,

My point was more to do with some firms not providing the neccessary information in the first instance. As I'm sure you're aware, there is very clear guidance from both a legislative and regulatory perspective as to what information *must* be conveyed to to a customer - and, of course, a guarantor.

I have however seen lots (both as a lender and more latterly as a debt advisor) of people who signed up without thinking past what they were going to spend the money on. It's a fact of life

I absolutely agree with this. In the majority of cases I come across, people guarantor loans (often for a close friend or family member) only to find that the person either stops paying or doesn't pay at all (for whatever reason).

If you're aware of the industry, you should know that some firms have changed names to get away from historial issues around regulatory compliance and suchlike. Perhaps my post wasn't particular clear, but I just wanted to emphasis that these lenders should ensure that they treat their customers fairly. It wasn't to do with whether someone would not be fully understanding what the ramifications are as opposed to not being told. In addition, where people do end up in financial difficulty, there are always options available to help them manage their debts effectively.

I really hope this makes sense,

Very best wishes,

David.

Hanky_Panky

National_Debtline wrote: »

Hello there,

My point was more to do with some firms not providing the neccessary information in the first instance.

But that's exactly my point - who have you seen that hasn't had a legal agreement to sign where it clearly states what the ramifications are ? So lenders are providing the necessary information but people don't bother reading it or trying to understand it or going to get legal advice if they don't.

ConsumerWizkid

Hanky_Panky wrote: »

But that's exactly my point - who have you seen that hasn't had a legal agreement to sign where it clearly states what the ramifications are ? So lenders are providing the necessary information but people don't bother reading it or trying to understand it or going to get legal advice if they don't.

Whilst often it is the fault of the borrower, it's not totally unheard of for lenders to have poorly trained sales staff that gloss over elements of a contract. Give poor National Debt Line a break xD

Hanky_Panky

ConsumerWizkid wrote: »

Whilst often it is the fault of the borrower, it's not totally unheard of for lenders to have poorly trained sales staff that gloss over elements of a contract. Give poor National Debt Line a break xD

But it's not the responsibility of the lender to read the loan agreement for the borrower no matter how bad their staff are. People need to take responsibility for their own actions, I don't want to live in a nanny state where it is deemed I am incapable of managing my own affairs.

I can't give someone a break when too many people take what they say seriously but I'm looking at comments written and shaking my head in disbelief - this post isn't the first one either !