under 18 loan

3 Posts

in Loans
Am after some advice - my daughter was "given a loan by her company at the age of 17 (shes now 18) to help her commute to work. They take x amount out of her wages every month, and she still has approx 75% to pay back. However, we're in the process of moving away and although she's adamant she wants to carrying on paying the loan, they're asking for all of it up front. When she signed the agreement, neither of us parents were present and it was co-signed or guaranteed by anyone. What is her position do we think?
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Can you lend her the money if she doesn't have it?
Neither of you need to co-sign or guarantee unless the company requested it.
If a season ticket and no longer used you can usually get a refund for the unused period and use that to pay back the loan.
It surely would be. Just like her employment contract is legally binding, not just a casual agreement. 'Loans' via work are not FCA regulated loans. It will be treated as an addendum to her contract, an advance against future pay.
Normally the repayments are taken from the pay packet, so if she leaves the job (because you're moving away) then there will be no pay packet to deduct from - hence the need to repay the oustanding balance all at once. It's not a loan in the traditional sense, and it doesn't tie her to her employer for evermore.
Presumably her last pay packet won't cover the outstanding loan amount?
The season ticket would also not be needed anymore, so she should be able to get a refund. Was the move not on the cards when she took out the loan? Did she / you fail to understand the repayment terms?
Edit: I see it's for a car, the argument here is she can /should sell the car to settle the loan.