MSE News: Got an HSBC personal loan? You could be due share of £218 million in refund

Molly80

JKSandy wrote: »

I believe it's all loans from June 2010.

I thought that too, until I contacted HSBC. I had a loan which I took out in September 2010 which I enquired about. They replied to say that only loans from 31st October 2010 are affected, which contradicts the information in the letter they sent me relating to a different loan with them which I took out in 2012.

Sashakins

Thanks for the responses.
Perhaps i am just clutching at straws but surely even if the loan was taken pre June 2010 all statements after that date should state that you can make over payments as per current legislation?

JKSandy

Sashakins wrote: »

Thanks for the responses.
Perhaps i am just clutching at straws but surely even if the loan was taken pre June 2010 all statements after that date should state that you can make over payments as per current legislation?

I don't believe you could make overpayments to loans before the specified date, as it was part of the new loan T&C's.

SpiceIsland

JKSandy wrote: »

I don't believe you could make overpayments to loans before the specified date, as it was part of the new loan T&C's.

Check your statements for this: If it was not included as below in that exact format from October 2008 you have a winning ticket.

PART 2 Regulation 4(b)
FORMS OF WORDING TO BE INCLUDED IN STATEMENTS RELATING TO
FIXED-SUM CREDIT AGREEMENTS

4. Each of the following forms of wording shall be contained in a statement under this Part:
“Settling your credit agreement early
You can settle this agreement at any time by giving us notice in writing and paying off the amount you owe. If you wish to settle early you should contact us for a final settlement
figure.”;
“Dispute resolution
If you have a problem with your agreement, please try to resolve it with us in the first instance. If you are not happy with the way in which we handled your complaint or the
result, you may be able to complain to the Financial Ombudsman Service. If you do not take up your problem with us first you will not be entitled to complain to the Ombudsman.
We can provide details of how to contact the Ombudsman.”;
“Paying less than the agreed sum:
If you pay less than your agreed payment in most cases it is likely to take you longer and may cost you more to pay off the debt under the agreement. If you have difficulties making payments under your credit agreement please contact us if
you have not already done so to discuss terms for the rest of the agreement. You may also
13
want to seek advice on what to what to do from an independent free advice agency such as the
Citizens Advice Bureau.”.

a51_ufo

http://www.moneysavingexpert.com/news/loans/2014/12/first-direct-starts-refunding-customers-over-paperwork-blunder

BRITGUY

Thanks Spice Island above, I've seen that wording before in my travels, but I am still intrigued by the First Direct wording 'Loan customers are now receiving letters letting them know that as the bank didn't tell them they could make overpayments to settle their loan at any time...' To me the overpayments point is not the same as the right to early settlement - I say that not just optimistically but I notice the way that in addition to the settlement point, banks have started adding reference to the right to partial overpayment over the last year in particular. Any thoughts on that? Thanks very much.

SpiceIsland

BRITGUY wrote: »

Thanks Spice Island above, I've seen that wording before in my travels, but I am still intrigued by the First Direct wording 'Loan customers are now receiving letters letting them know that as the bank didn't tell them they could make overpayments to settle their loan at any time...' To me the overpayments point is not the same as the right to early settlement - I say that not just optimistically but I notice the way that in addition to the settlement point, banks have started adding reference to the right to partial overpayment over the last year in particular. Any thoughts on that? Thanks very much.

The Lender (Bank) should also have advised on your Annual Statement something like this:
If you don’t want to pay off the whole amount owed, you can still pay off part of the loan early. This is called partial early settlement. The amount of rebate you get will be less than paying the loan off in full.

The Office of Fair Trading wrote to all Banks in November 2013 informing them of this and asking if they have included this on annual statements. Most banks as far as I am aware failed and are now paying out. Some are dragging their heels!


The right to overpay

First, though, it's worth noting that every personal loan holder does have the right to overpay on their debt.

The Consumer Credit Directive, which came into force in February 2011, strengthened existing consumer law on overpayment of loans and limited the amount lenders could charge for early repayment.

Under this directive, the early repayment penalty for new loans cannot be over 1% of the amount being repaid early.

If the payment is made in the final year of the credit agreement, the penalty cannot exceed 0.5%.

For older loans, the penalty can be no more than two month's interest.

letThemPlay

Just got back home after the holidays; and a little disappointed to not have had anything through the post on the issue.

Does anyone know if they are sending out the letters in batches or should I contact HSBC and enquire why I haven't received a letter.

gazcarter123

Received £236.29 refund for loan taken out in Jan 13. (HSBC)

This reminded be of another loan I took out in Sep 11 and now payed off. Rung them to query this and all of a sudden I've a letter in the post with another refund due in 5 days, they would of otherwise got away with not paying me for this closed account I'm sure!!!!!!

I'd ring HSBC and check all your old loan accounts is my advise.

letThemPlay

Disappointed, I finally managed to contacted HSBC about the issue this morning; and after a protracted conversation where he finally realised what I was talking about he told me the issue did not affect all loans from the date specified; and if I wanted to go further I would have to submit documentation to try and prove that it did affect me.

Normally this would not be a problem but a couple of years ago when I moved flats some of my documentation went missing and unfortunately that was part of it.

Congratulations to everyone who got the redress but it looks like I'm going to miss out.