Should I refer my bank and my complaint to the Financial Ombudsman?

JC1212

Hi all,

To cut a long story short, over the past year, my bank (I won't say who at this stage) have completely messed me around in terms of my personal loan. The loan was on a 18.9% interest rate and due to various COVID payment holidays, the bank then advised that they could refinance my loan at a lower rate. This offer was then taken away, due to the fact I had taken a payment holiday. This made no sense and as such I raised a complaint with the CEO/Exec office and after 6 weeks of investigating, it was upheld within the bank. They accepted that they had let me down on numerous occasions (mis-advising me, rude customer service reps, hassling via letters/emails when they weren't required etc, the promise of a new loan, 3 x lost forms in the post and the email system not sending me them etc etc) and agreed to refinance the loan at a lower rate, compensated me for the problems and refunded 2 x payments of interest. This was agreed on 19th March. There was then a 42 day period from the agreement over the phone, to receiving the paperwork (I made sure I sent it back the same day), the new loan being issued and my old loan being completely closed. However, this delay in part was due to the bank sending me new forms, as I moved house during the process, and the old address was no longer valid on the old form. I had explained this was happening when I spoke to them in March and I was repeatedly told that this wouldn't be a problem. However, I wasn't informed of the delay by the loan department and the new forms just suddenly turned up at my door (I actually missed them and had to take some time off work to go collect them from the Post Office). I have since been offered another £50 of compensation for this trouble and refunded a further interest payment due to the delay.

The problem I have now however, is that the day before my loan was paid off, the loan balance was £19,549 - this was due to payments and refunds since January. There was then an adjustment of £362 to my loan account - I have no idea why, but this brought my loan balance down to £19,186 on the day of the refinancing. 

Due to originally being quoted a figure of £20,650 in January to close the loan and refinance at a lower rate (but with no mention of there being interest charged to close the loan at the time as my balance was around £20,500), I was expecting a difference of approximately £1,415 to be left in my current account. However, the bank are claiming that the cost of interest to close the loan was £690.97. I understand that there is a 58 day charge sometimes imposed, although this can be waived when refinancing internally and also if the debt has to be increased in order to pay the interest. However, the 58 day charge certainly doesn't equal £690.97. It was also wasn't raised during any conversations I've had this year about the refinancing. I've highlighted this numerous times, but was told by the person handling my complaint (who works on the exec team), that he is looking into the interest charge and the credit search. My point was that there should have been a breakdown and an explanation given somewhere along the process, which hasn't been given at any point. 

It's now been over a week since I've heard from the bank and I fear that now the loan has completely closed and the new one is up and running, they may just go silent on me. I'm getting close to raising this with the Financial Ombudsman on the grounds that there has been no clear process (apart from the person who handled my original complaint, he's tried to be helpful but I feel has been let down by wider aspects of the bank), a lack of communication between all parties and potentially a balance owed to me from the bank. The 42 day gap in March-May certainly caused me additional stress and worry, knowing how the bank had treated me previously. In addition, I was also informed that my new loan would not affect my credit rating, however, a hard search has since been placed on my account.

Any advice would be most helpful!

Thanks,

J

[Deleted User]

There doesn't seems to be any reason to refer to FOS. They've given you some compensation for the delays, which is more than they need to do. 

A hard search will always take place on a new loan.  Any change to the credit rating that another lender applies to you is out of their control.

Once you have the full figures, you can check everything is ok, but it almost certainly will be.

Sandtree

It may be because this is the short version but its not clear how many different events there have been or how many different complaints and compensation made.

To go to the FOS you need to ensure that you have complained to the organisation in question and either have received a final response or its been eight weeks. If therefore your current issue is something since the last complaint you'd need to go back through the process first.

JC1212

Thanks for the replies both. All of this is falling under the blanket of one complaint. But a good point to raise about the final response - Unfortunately, the person handling the complaint has gone very quiet...