Unenforceable loan agreements

bobpitbull

How variable is variable allowed to be, though...?

I mean, what's to stop Richard Branson from putting the rate up to 10,000%, forcing everyone with a Virgin Credit Card who can't transfer to another card into bankruptcy...?

It increased from 15.9% to 29.9%... that's more than variable - that's extortionate. Plus, since I didn't receive the letter from them, don't I have a right to complain? Sure, it would show on my bill but ... to be honest ... I never really took much notice of them ... I spend a lot of time out of the country ... I noticed my bank account was low but I didn't really look into it until I got today's letter about the further increase...

Innocent_Guy

http://forums.moneysavingexpert.com/showthread.html?t=1612055&highlight=

~Brock~

bobpitbull wrote: »

I mean, what's to stop Richard Branson from putting the rate up to 10,000%, ...?

The unfair relationship terms of the Consumer Credit Act 1974 (Section 140A) as amended by the Consumer Credit Act 2006 would stop Richard Branson from doing that.

bobpitbull wrote: »

It increased from 15.9% to 29.9%... that's more than variable - that's extortionate.

No its not. Credit card interest rates are set using a balance of risk, ecomonic variables and any desire (or otherwise) to compete in the market. 29.9% is expensive, but not extortionate.

Perhaps if their time and money wasn't being wasted by every man and his dog trying to challenge their agreements some of the savings may be passed on by not putting rates up so much.

Note to self: must stop thinking sensible thoughts. This is, after all, the UK.

aj2703

~Brock~ wrote: »

Perhaps if their time and money wasn't being wasted by every man and his dog trying to challenge their agreements some of the savings may be passed on by not putting rates up so much.

Note to self: must stop thinking sensible thoughts. This is, after all, the UK.

Dream On:rolleyes:

bobpitbull

For them to more than double the interest rates, that would surely mean that they are losing 50% of their income from the interest rates of their customers (on average)... by my calculation, that would mean that at least 20% of their customers had had their balances wiped (assuming that the full cost of such an action bears down on Virgin themselves - I have no idea if Virgin have insurance for such things).

There's no justification for increasing their rates so much. Even though my salary was - incorrectly - reduced to 50% of what it should've been for 15 months (due to a tax miscalculation) I still managed to pay all my bills... sometimes a week or two late, I admit, but I never suffered any CCJ's etc... given the circumstances, I think that I demonstrated myself as being much more frugal and financially savvy than most people could.

Yet, still, just as I see a light at the end of the tunnel with the HMRC finally agreeing to refund me, companies such as Virgin are trying their best to stick the knife in deeper while they can... it is absolutely disgusting.

Extant

bobpitbull wrote: »

There's no justification for increasing their rates so much.

Oh no?

I still managed to pay all my bills... sometimes a week or two late, I admit

Oh, yes there is. By not paying on time you (correctly) gave the impression that you're having financial difficulties.

As such, you pose an increased risk to Virgin Money and this justifies a higher price for credit.

but I never suffered any CCJ's etc... given the circumstances, I think that I demonstrated myself as being much more frugal and financially savvy than most people could.

A late bill is a late bill and reflects either carelessness or financial troubles. Claiming that you were more frugal and financially savvy than everyone else really means nothing by this point.

Yet, still, just as I see a light at the end of the tunnel with the HMRC finally agreeing to refund me, companies such as Virgin are trying their best to stick the knife in deeper while they can... it is absolutely disgusting.

You're taking a business decision personally. It's not "sticking the knife in," your behaviour gave a company reason to believe you were a greater risk, and they adjusted their pricing to suit.

aj2703

And now he has sorted a "no fault of his own" problem with HMRC and is back to where he should always have been financially, do you think Virgin will lower the interest rate...? I think not..!

~Brock~

'man in the pub logic' ..you can't beat it.:beer:

aj2703

Yeah you should try it sometime ~muppett~

bobpitbull

I understand that some people can be "higher risk" by not paying on time... but lets face facts... we're in a recession right now. Is it right for, on one hand, the government trying to help people by lowering interest rates and trying to help people who have been made redundant... then, on the other hand, other financial institutions increasing their rates for, probably, the same people...

What's happening is that companies like Virgin are forcing people into bankruptcy...

If Richard Branson's companies suffer the same difficulties as individuals, he'll probably get a cash handout from the government in order to survive... just like Northern Rock, Nissan, Lloyds, Barclays and so many other companies that have taken people for a ride for so long. Meanwhile, as his company is failing and costing the taxpayer even more money, he'll increase his rates and pocket a bonus in the tens of millions at the same time.