Stepchange/Halifax Problem

houst69

I have been on a debt management plan with Stepchange since 2009, I was due to be debt free this month (June 17) however, Halifax have decided to add nearly £4,000 in on interest.

I have nearly paid off £35,000 worth of debt off already and this is a massive blow as we were looking forward to being debt free after so many years

We have contacted Stepchange and they say they cannot do anything at all and Halifax are quite within their rights to add interest to the account.

Is this true? Does anybody have any advice?

Thanks

National_Debtline

Hi Houst69 and welcome to MSE,


I am afraid they can add interest to the account, even if you are in a debt management plan. Although most creditors don't do this, they are not prohibited from doing this.


However, you may be able to make a complaint if Halifax agreed to freeze interest, in writing to either you or Step Change and are now trying to claim it retrospectively. The creditors should not agree to freeze interest and then, years later, try and reclaim it for that same period. You will need to check your paperwork and the 'devil will be in the detail'.


If Halifax agreed to freeze the interest for, example, 6 months and then review the matter you would need something in writing to say they will freeze the interest thereafter, otherwise they are likely able to add it. However, if they agree to freeze the interest for, example, during the term of the DMP then you may be able to make a formal complaint that they should not be adding it, in a lump sum now.

Your complaint should go to Halifax and then to the Financial Ombudsman Service if it remains unresolved.

Laura
@natdebtline