Forced into taking overdraft advice please?

Livvipivvi

Hello everyone,

We've been paying off our debts via a DMP with Stepchange for several years and are about 16 months away from the end. With all the talk of claiming back PPI, I thought that I'd start looking into our old loans and overdrafts to see if we can claim anything back. Things are tight financially and a little sum of money would be great about now, even if it were taken off outstanding balances, at least it would shorten the time left on our DMP .

The story, sorry I'll try to keep it as short as possible...

Back in 2005 we needed a new car, so decided to part ex the banger and get a solid family car. We had a joint account with Barclays at the time, my partner (unmarried then) was working full time, we had a 4 year old so I was a stay at home mum. My partner got agreed for a personal loan to finance the purchase and we went ahead and bought the car. A few days later I realised that it would be cheaper to borrow from elsewhere, so my partner got another loan for the same as the original amount and we went back to Barclays to pay back the loan in full.

Unfortunately the second loan took a bit longer to clear and it was day 15 after taking out the Barclays loan. We knew the 14 day cooling off period has just passed so expect to have to pay a fee, but thought that it would be £50-£100. Nope, I can't remember the exact amount but it was about £400! We didn't have it. I remember sitting in the bank, totally stumped. It was made clear, pay the £400 odd or keep the loan. We explained that we didn't have it. The staff at the branch suggested upping our overdraft, but it was declined (probably due to partners 2 recent loans). Then we weee told that I could open a single account with a £500 overdraft. We were confused as we made it clear that I was unemployed, but they said I'd been agreed. I didn't feel comfortable with the situation, but I felt I had no choice. We were made to feel that the longer we left the loan outstanding, the more it would cost to get out of it, so I agreed to the overdraft, we paid off the loan and got out of there!

I know it may sound silly to some, but we were young and green and just couldn't think further than being on the spot and wanting out of the loan.

Years passed and I basically (and very stupidly) just put £20/£30 in every few months to keep on top of the fees and it is now part of our DMP.

My question is, does anyone know where I stand with this overdraft? Was I missold it? Should I have even been offered it? Is there a case to get interest paid back or anything else?

Sorry for the long story. Any advice would be appreciated. TIA ��

DCFC79

So about 12 years ago, you might be out time.

PeacefulWaters

Give over.

[Deleted User]

No need to worry OP. Being offered the overdraft was fine and no wrong doing.

Hopefully that's a weight off your mind.

Livvipivvi

Thank you for responding to my post all.

"Give over"...rude much! Lol

We are more than happy to pay it back, like the other debts included in the DMP. I'm not worrying, no weight to be lifted. As I've already mentioned, it's coming towards the end now and we will have paid back every penny of our debt. But let's be honest, we were ripped off. Over £400 in charges for 15 days of a loan of around £5k is ridiculous. Maybe it was miscalculated, we should have had the sense to question it at the time, but we didn't unfortunately and the time has passed to check or question that now I suppose. That loan was paid off in full and so was the second/replacement one we took out, many years ago. But it was our first loan, it caught us. Sat at the desk at nearly closing time, with our 4 year old getting restless and we were made to feel that we didn't have time to think it over. I didn't have a job and no intention of getting one in the near future, should they have done that. They've made off us well (by our standards) for what we've had, basically a 15 day loan.

fwor

Livvipivvi wrote: »

Over £400 in charges for 15 days of a loan of around £5k is ridiculous.

If the terms of the loan said that this is what would happen after the cooling off period, then it's not unreasonable that this is what happened. If the terms did not say that this would happen, you would have a case - though instigating any type of legal action over a decade later is not something I would expect to be easy.

The offer of an overdraft is not an issue as far as I can see - they were simply offering you a way around a difficult situation that you had got yourself in, and there does not seem to have been any compulsion or coercion involved.

Personally, I would just forget about it...

PeacefulWaters

Livvipivvi wrote: »

Thank you for responding to my post all.

"Give over"...rude much! Lol

I'll try again. You're being a chancer years after the event. They offered you an option at the time and you took it. They didn't beat you into submission.

We are more than happy to pay it back, like the other debts included in the DMP.

Isn't the whole point of a DMP is that your not happy to pay it back, because you've declared yourself unable to?

As I've already mentioned, it's coming towards the end now and we will have paid back every penny of our debt.

Well I'm going to take a wild guess that you won't have repaid the amounts contractually due including interest prior to entering a DMP. Nevertheless, well done. A time to stabilise and continue life without borrowing.

But let's be honest, we were ripped off. Over £400 in charges for 15 days of a loan of around £5k is ridiculous.

It depends on the APR, but while £400 sounds on the high side for early termination it doesn't seem wildly excessive or out of the question. Paying off loans early tends to involve paying interest for the next couple of months.

Livvipivvi

PeacefulWaters wrote: »

I'll try again. You're being a chancer years after the event. They offered you an option at the time and you took it. They didn't beat you into submission.

I'm not chancing anything. I haven't contacted the bank or stopped payments, I've been going through old paperwork and it made me wonder if they should have offered an overdraft to someone unemployed. So I've come to ask people who have a better understanding than me. How is that chancing?? I didn't say anyone beat me into submission, but I did say that I felt on the spot and like I didn't have time to go away and think about it.

Isn't the whole point of a DMP is that your not happy to pay it back, because you've declared yourself unable to?

Totally unfair and ignorant comment. You don't know me, our situation, how much we owed originally or why we ended up on the DMP. My husband has been in the same job since the nineties and was on a steady income, which allowed us to pay our debts easily. We had not racked up £1000's of debt beyond our means and there was a genuine reason for taking on the debt in the first place, we haven't been on expensive holidays or got a house full of pretty things, don't tar everyone on a DMP with that brush. My husband was affected really badly during the recession. It's just as well that our children were both in school when it happened, because if I hadn't gone back to work we would have lost our home too. Or maybe you feel that we should have prioritised our unsecured debt, not gone on a DMP and sold our simple family home instead? "Give over".

Well I'm going to take a wild guess that you won't have repaid the amounts contractually due including interest prior to entering a DMP. Nevertheless, well done. A time to stabilise and continue life without borrowing

No we will not have paid back as much interest as we would have if we had carried on without the DMP, but due to our circumstances it was the best option for the lenders. If we didn't care about paying back all of what we owed and wanted the easiest and cheapest route for us, we would have gone with an IVA and had some written off. Didn't make any difference to us, in fact our credit score will take longer to recover on the DMP. Don't worry about the big companies losses now, they made plenty off us before we took out the DMP and interest was stopped, and they will get every penny of what we borrowed back plus more than enough interest to make a profit. Which is a lot more than if we had chosen the IVA.

It depends on the APR, but while £400 sounds on the high side for early termination it doesn't seem wildly excessive or out of the question. Paying off loans early tends to involve paying interest for the next couple of months.

Thank you for your advice. All I wanted to know is if the charge sounds like a normal amount for being 1 day over the cooling off period and if unemployed people should be offered £500 overdrafts, especially considering that it was to pay my partners debt.

The interest rate would have been 9.something. 5k over 3 years.

amfan

Livvipivvi wrote: »

Thank you for your advice. All I wanted to know is if the charge sounds like a normal amount for being 1 day over the cooling off period and if unemployed people should be offered £500 overdrafts, especially considering that it was to pay my partners debt.

The interest rate would have been 9.something. 5k over 3 years.

You had gone into the bank as a partnership, the bank saw you as that and offered an alternative to the overdraft your partner had been refused. If you didn't want any part in his debt you could have let him go in alone, the overdraft would have been refused and you would then have had no way to pay the charges. Yes they offered an unemployed person an overdraft, but you had already presented yourself as a person with a stake in the original £15k you and your partner had invested in your family car, you can't blame them for treating you both as a partnership.

Livvipivvi

amfan wrote: »

You had gone into the bank as a partnership, the bank saw you as that and offered an alternative to the overdraft your partner had been refused. If you didn't want any part in his debt you could have let him go in alone, the overdraft would have been refused and you would then have had no way to pay the charges. Yes they offered an unemployed person an overdraft, but you had already presented yourself as a person with a stake in the original £15k you and your partner had invested in your family car, you can't blame them for treating you both as a partnership.

Thank you for responding. I see your point. I had no partnership in the car however as I didn't even hold a drivers license and the car was registered in his name. Had we parted ways, the car was 100% his. I had no claim on it (or use for that matter, because I couldn't drive lol). But yes, to the person in the bank, it would be fair and reasonable to assume that. £15k, I wish lol. Maybe when the children are older and the mortgage is paid off.

amfan

Livvipivvi wrote: »

£15k, I wish lol.

Apologies, I seem to have added another 10 thousand onto your loan . You do however say we needed a car, and it is a family car. It is reasonable to assume that for the duration of your relationship at least, you saw this as something for the family and not solely for your partner.