Headline rate 'scam' - M&S Loans

BenjaminClarke

regency_man wrote: »

How is the advertising over 'headline' loan rates regulated and which consumer body should handle complaints regarding these?

Currently in this situation:

• Was about to apply for a loan with my long-term bank with an advertised rate of 3.6% but at the last minute see an offer from M&S Loans at 3.3%.
• So I applied for the loan at 3.3% with M&S.
• Read all the small print - yes it said the 3.3% rate was 'dependent on circumstances'. Checked my credit score/rating - all looks great (998 on the Experian system).
• Apply, and get the loan decision back immediately - Accepted, but at 6.3% APR.
• Call M&S to ask why the rate is so far from the headline rate. They said it's all down to their rating system and they cannot change the rate, full-stop. Starts giving me some clearly scripted sales pitch about how it's "only £20 extra per month, surely that is still affordable for you" I reply that £20 a month over 3 years is a lot of money. He says "well if you're going to look at it like that then perhaps this loan isn't for you"!!!
• I keep pushing him on it, stating false advertising of rates, and he puts me through to their 'underwriting team'.
• The underwriting team rep reviews my file and says it's probably not actually down to my credit history because he can't see anything negative, but more down to the details on my application. Specifically says that because I have not lived at my current address for more than 2 years, and because I put 'Miscellaneous' under the loan purpose this will adversely affect the rate offered.
• I thank him for the feedback and tell him I am probably not going to proceed with the loan based on this and will shop around. He says he will send the documents through anyway and I have 30 days to decide.
• 2 working days later I get an Alert from Experian, M&S Finance have made another search of my credit file listed, like the original search, as 'Loan Application' - now there are warnings all over my file saying that I have 'a significant number of recent searches' and my credit score has plummeted.
• I call M&S to find out what on earth is going on. I ask for it to be put through to the fraud department as I did not make the second application, but they seemed to have dealt with this sort of thing before, they said it's not fraud because the second 'phantom' application had the exact same details as the first. They 'escalate it' within their customer services team.
• Get a call back a few hours later from someone, she says they've reviewed it, decided it was not fraudulent, but they don't know why it happened - she says "probably just a glitch in our system". I said if it's a glitch, I want the second search removed from my credit file. She says she will ask for this to be done, but to be aware it will take "around 30 days" for this to be processed.

Hmmm, how convenient, the second credit search will stay on there, negatively impacting my credit file and ability to get a loan offer from elsewhere for exactly the same period that their loan offer is valid for....


So.. I ask.. :

• If answers given on their application form are directly impacting the rate - surely they should be required to publish this up front? Consumers are not playing with a full deck if simply not having lived at an address for over 2 years and putting 'Miscellaneous' in the 'Reason' field automatically means you don't get the advertised rate. How is this not covered under false advertising rules? If car dealership advertised a car for £5,000 under RRP but then when you got to the dealership they said "ah, because you have told us you want to use this car to take your kids to school, you have to pay an extra £5,000" that would be completely unacceptable right?
• Who regulated these offers - and decides what is acceptable for loan companies to advertise at vs. acceptance ratio? What's to stop a loan company advertising at 3.3% but having such restrictive criteria that it actually amounts to false advertising?
  "why sure, you would have got the headline rate if you were a 18 year old female divorcee, living in a post-code with a 7 in it and told us you were using the money to buy a boat".
• I seriously suspect the extremely dodgy 'second search' appearing on my file and can't be removed for 30 days is a sales tactic by M&S to prevent me getting competitive offers. I'm not happy with the explanation that it was a 'glitch' in their system. Who do I report this to?

Thanks!!!

You won't get the answers on here that you want. I have realised this now and therefore given up. All people will tell you on here is to not bother applying for credit.

I am totally with you though. Nothing lenders do is in the interest of the customer. You can understand it, why should they be at the end of the day? They want to lend you money but only if it's going to make them a lot of money in the process. On the price comparison website I used I said that I wanted a £5000.00 loan over 5 years. Those were the criteria I selected. I was offered 3.4% on several loans based on this criteria. I have since been told that those better rates only apply to larger loans, say £25000.00. Therefore we are being misled as customers. This is apparently all my fault. The 3.4% might exist on higher loans but it'll give you this lower rate whatever criteria you choose and it won't be until after they have searched your credit file that you get the true interest rate, 3-4 times higher than advertised. Honesty and banking do not go together, that's something we all should have learnt by now I guess.

meer53

BenjaminClarke wrote: »

Another narrow-minded Tory boy. Of course it happens! When I turned 18 I went to University and from day one had money thrown at me. Also, with how University life is, I lived in six different places in three years. I spent most of my time having a good time and because the banks threw money at you it was easy to build up debt. I think you'll find there are MILLIONS of people who do this every single year, although I understand it is harder today to get multiple student credit cards or accounts. In my day though they threw it at you. One day I woke up to a letter on the door mat from Lloyds TSB. I opened it and inside was a credit card that I had never even applied for. The letter said there was £2500.00 on the card and if I wanted it all I had to do was sign the back. The pin code was the same as my student account I had with them. I was 18-19, chasing girls and having a good time. What do you think I did!? I guess you'd have returned it and gone back to your bible? Give me a break! The only reason this didn't happen to you is probably because you never went to Uni! I've had it with all my friends over the years. They don't know though because they just left school and got jobs etc. and so didn't even think about applying for credit until they were in their mid-twenties. They still had to use sites like Experian though during the process to ensure everything was in order because they were advised to do so by the banks. You are just lucky you haven't had to deal with these companies.

I take responsibility for what I did and have since paid all of my debts. I hold no regrets though because I had more fun in those three years than most people on this forum have had in their entire lifetime by the sounds of it!

OK i'll spell it out. I am a single Mum with 2 children. One of my children is a son who is now 28. He went to Uni, he didn't take out a credit card, despite people offering to throw one at him, i brought him up to understand that you never spend what you cannot repay. Maybe if your parents had done this for you, you would have your mortgage and wouldnt be looking to borrow more money to repay what you borrowed already ?

You chose to spend money that didn't belong to you, you are now paying the price for this. In my mind that makes you very silly. I'm being kind here, i can't really type what i want to call you.

[Deleted User]

BenjaminClarke wrote: »

culturally and politically and narrow-minded people are what is holding us back.

OK. So we need to be open minded, and not jump to to conclusions. I think we're all in favour of that.

BenjaminClarke wrote: »

You are obviously an older gentleman

BenjaminClarke wrote: »

Another narrow-minded Tory boy.

meer53 wrote: »

I am a single Mum with 2 children.

Oh.

BenjaminClarke

meer53 wrote: »

OK i'll spell it out. I am a single Mum with 2 children. One of my children is a son who is now 28. He went to Uni, he didn't take out a credit card, despite people offering to throw one at him, i brought him up to understand that you never spend what you cannot repay. Maybe if your parents had done this for you, you would have your mortgage and wouldnt be looking to borrow more money to repay what you borrowed already ?

You chose to spend money that didn't belong to you, you are now paying the price for this. In my mind that makes you very silly. I'm being kind here, i can't really type what i want to call you.

I bet your son had a really nice time at University....

I also bet you helped your son through it? Well if you want to get personal let me tell you my story, briefly. My mum died when I was five years old and left my father with six kids. I have five sisters, no brothers. I grew up with no money whatsoever. My Dad worked hard but a mortgage and six kids would be tough for anybody financially. I have been given nothing money related by any member of my family ever. Most of my friends at Uni had their parents paying for accommodation, I didn't. I had a job from the age of 15-17, whilst still going to school studying A-Levels, earning £35.00 a week. That's the most money I had ever had before: £35.00.

When I left for University my dad did tell me to be careful with debts. Did I listen to him? No I didn't. I wanted to have fun and didn't care at that time about the consequences. Guess what? MILLIONS of others do the same every year. Yes it was hard when I came to pay these debts off but I still don't regret what I did. I just hope that your son can say the same thing?

You only live once and I believe it's good to make these mistakes when you are young. You have years to fall in line so why be boring when you are 18 years old? Seriously I feel sorry for people who take life so seriously financially. Loosen up, spend a little and have a good time!

You are definitely a Tory though...

BenjaminClarke

Deleted_User wrote: »

OK. So we need to be open minded, and not jump to to conclusions. I think we're all in favour of that.



Oh.

HAHA, if you had read all of the posts you'd see that I was attacked first by the members of this forum. If you make an assumption about me then I'll make an assumption about you. Understand?

That isn't being closed minded. That is being fair.

I am open minded. I understand that every single human being is different. Some are intelligent, some are not. Some understand life, some do not. Some are lucky, some are not. It's easy for some people to judge but I always keep an open mind, until it comes to closed minded people. That I cannot take, which is why I strike back. Basically to feed them some of their own medicine. Understand?

Pixie5740

Banks make money for their shareholders. It's really that simple. If you don't want to deal with banks then try a credit union but nobody has an absolute right to credit.

Given the way you've told us you have handled credit in the past I'm not surprised lenders see you as a higher risk but the high interest rates are worth it though because you had a great time spending the money...right.

meer53

BenjaminClarke wrote: »

I bet your son had a really nice time at University....

I also bet you helped your son through it? Well if you want to get personal let me tell you my story, briefly. My mum died when I was five years old and left my father with six kids. I have five sisters, no brothers. I grew up with no money whatsoever. My Dad worked hard but a mortgage and six kids would be tough for anybody financially. I have been given nothing money related by any member of my family ever. Most of my friends at Uni had their parents paying for accommodation, I didn't. I had a job from the age of 15-17, whilst still going to school studying A-Levels, earning £35.00 a week. That's the most money I had ever had before: £35.00.

When I left for University my dad did tell me to be careful with debts. Did I listen to him? No I didn't. I wanted to have fun and didn't care at that time about the consequences. Guess what? MILLIONS of others do the same every year. Yes it was hard when I came to pay these debts off but I still don't regret what I did. I just hope that your son can say the same thing?

You only live once and I believe it's good to make these mistakes when you are young. You have years to fall in line so why be boring when you are 18 years old? Seriously I feel sorry for people who take life so seriously financially. Loosen up, spend a little and have a good time!

You are definitely a Tory though...

My son had a brilliant time at Uni, he too lived in 4 different places. He also worked from being 16. Did you miss the bit about me being a single parent ? How did you come to the conclusion that i helped him financially ? I struggled to help myself there was no way i could help him out. He paid his own way, if he wanted to do anything, he had to fund it himself. Which he did. Snowboarding, festivals, holidays abroad with his mates, he did it all. He still does. He has no unsecured debt, he has a full time job, house and brand new car. He doesn't need to check his "credit score" as he was never irresponsible when he was younger. Shame you weren't the same eh ?

You do only live once. That doesn't mean that you can absolve yourself from any sense of responsibility.

BenjaminClarke

Pixie5740 wrote: »

Banks make money for their shareholders. It's really that simple. If you don't want to deal with banks then try a credit union but nobody has an absolute right to credit.

Given the way you've told us you have handled credit in the past I'm not surprised lenders see you as a higher risk but the high interest rates are worth it though because you had a great time spending the money...right.

Yes is the answer but please remember this was over 10 years ago now and I finished paying off the final debt, the one I had forgotten about, four years ago.

People are more privileged than others. I had never had money before so when it was thrown at me I took it. Why should that affect me 10 years later? It shouldn't and nowadays I hear that you can only have one student bank account and credit card so obviously someone with authority agrees that it was actually the banks that were more irresponsible for throwing money at students than the students themselves. Kids will be kids at the end of the day.

Anyway, we have digressed massively, which I take responsibility for. I just believe that the lenders have a duty of care to potential customers and therefore should show a little more consideration. I also understand that money makes the world goes around. As I said before, the fact you can pay £10,000 to have lunch with David Cameron says it all.

GingerFurball_2

This thread's !!!!ing hilarious, I should visit this board more often.

Good to see the old "well you obviously work for a bank" reply when people get called out for being absolute mentalists is alive and well.

Pixie5740

I can think of many things I'd rather spend £10k on than having lunch with a man who put his willy in a pig (allegedly). If you think anything can be bought in the UK and that it's corrupt you should try doing business in other parts of the world.