Creditor asking for more than I borrowed

ferret88

Hi all

I am currently in a DMP with the CCCS and one of my creditors (Northern Rock grrrr) are claiming that my debt to them is around the 23k mark when in actual fact I borrowed around 17.5-18k off them.

It would appear that they are adding all the interest that I would have incurred would I have continued paying the loan off in the usual manner. Can they do this? How can they ask for more than I borrowed?

Northern Rock have been a bane to me over this debt as they have the biggest share of the overall debt and that means I can't enter into an IVA. They have also been insistent to the point of harassment. They had a legal company write to me saying they were representing the debt so I put their details in my DMP and after about 4 payments to them I have been advised that the money hasn't been going to Northern Rock!

Would it be worthwhile writing to NR asking them to slash the amount owed or would I be better off trying to ice-skate uphill?

The Ferret

Crown

Hi Ferret,

Im pretty sure the creditor is within there rights to claim the money borrowed plus the interest. When you agreed to the original loan you would have been told what the interest rate would be. If you was to make a early repayment of the account you would be penalised with a charge of a certain amount of interest (normally the creditors use the rule of 78).

As you have actually defaulted on the original terms and conditions i.e not making the regular agreed payments its likely that they can hold you responsible for the entire amount. If in the future you do have funds available you could make an offer of full and final settlement.

I would suggest that you contact the CCCS again and ask them for advice.

Good luck

In_Search_Of_Me

I have a NR loan and it has front loaded interest - ie you pay the majoirty in interest before any of the capital....grrrr! Its REALLY annoying as means no point switching loans at this stage cos I'd just be paying interest all over again so I'm lumbered. It's SOOOOO annyoying isnt it! Lesson learned thehard way fr us both I suspect? Big hugs...

ferret88

I'm both shocked they can get away with this and appalled at myself for being such an idiot!

Is there any way I can get out of my agreement with them by claiming I wasn't given the right facts before signing or that I wasn't in the right state of mind (this might sound like a joke but I am currently off work long term with depression)?

Can it be shown that they didn't pay due care when offering me such a loan as at the time I had only just been with a new employer for a couple of weeks after being on the dole for six months, was making only 10.5k p.a. and the loan they offered me was 23k way more than double what I earned in a year?

Is there any way I can force them to split up my debt to them and pass either one of them onto a different company, so I can at least try for a IVA?

Ferret x