Mis-sold loan

kat153

My partner was paying two seperate loans which came to a total of £3,000 borrowed. He called the bank to see if they could put two loans together do that he would be paying one amount once a month rather than one at the start and one at the end of each month. After repaying for years and realising he wasn't getting anywhere he realised how high the interest was, and called the bank today to be told that he was in fact sold a third loan to pay off the initial two, which therefore added the interest of those two loans and the jnterest for the new loan. This means he is paying back a total of £7,000. This was not explained to him when he agreed to the loan, therefore it was mis-sold. If we were to file a formal complaint, what is the likelihood of success? Or does anyone have any general advice? He is now half way through paying back the 7k with over 3 years left!!!

Thrugelmir

Consolidating 2 existing loans would result in a third new loan. That's how it works. Your partner applied and was offered, and accepted the terms of the third loan. Therefore wasn't misold.

Without the finer details impossible to comment on the actual loans themselves.

[Deleted User]

If the third loan hadn't paid off the first two, he would now have three loans.

The interest of the three loans wasn't added together. Interest doesn't work like that.

Nearlyold

The bank provided what your partner asked for, you can't "combine" two loans without creating a new loan. Unless they were loans that dated from 30+ years ago the interest that had not yet been charged on the two original loans would not have been added to the new loan. The new loan would simply be the total of the balances at the time of the two original loans plus a maximum of 2 months interest based on the balance at the time of each original loan.

The total payment may be high because he's taken the new loan over a long term or the interest rate is rather high or a combination of both.

DCFC79

Why did he not question it nearer the time ?

Sncjw

What did he do with the money he was given from the loan?

sourcrates

This is why we have credit agreements that contain all the appropriate financial information, which you should check before signing.

There is always a cooling off period for any type of CCA regulated finance, that is the time to say something if you are unsure about what you have signed up for.

However, you may have basis for complaint if you were not provided with a copy of your credit agreement or you were not told about the cooling off period or if you believe the terms of the loan were not explained to you sufficiently beforehand.