Did I do the right thing?

pocohontas

I have been paying £66 (the minimum monthly payment) a month by direct debit to GE Bank for a kitchen I bought from B & Q. I recently rang them and asked them if they could increase this amount by £50 as obviously I don't want to be in debt longer than I have to. They told me they could not change the amount of a direct debit and the best thing I could do was set up a Standing Order for the extra I wished to pay. I did this only to discover that the following month they REDUCED my direct debit by the amount of my standing order. I am furious as it feels they are actively trying to keep me in their debt and when I rang them (spending 15 minutes on hold) they couldn't give me a straight answer. I have amended my Standing Order to a total of £120 and cancelled the direct debit entirely. Are they likely to get shirty with me for having done this even though I'm still making monthly payments?

dmg24

I would have rang them again rather than just cancelling the DD.

Some credit agreements will not let you shorten the term of payment without a large redemption fee, you need to check this on the paperwork that you signed.

Clive_Woody

pocohontas wrote: »

I have been paying £66 (the minimum monthly payment) a month by direct debit to GE Bank for a kitchen I bought from B & Q. I recently rang them and asked them if they could increase this amount by £50 as obviously I don't want to be in debt longer than I have to. They told me they could not change the amount of a direct debit and the best thing I could do was set up a Standing Order for the extra I wished to pay. I did this only to discover that the following month they REDUCED my direct debit by the amount of my standing order. I am furious as it feels they are actively trying to keep me in their debt and when I rang them (spending 15 minutes on hold) they couldn't give me a straight answer. I have amended my Standing Order to a total of £120 and cancelled the direct debit entirely. Are they likely to get shirty with me for having done this even though I'm still making monthly payments?

When you took out the finance agreement it would most likely have been for a set number of years at a fixed interest rate. From this they would expect to recieve £X.XX from you in total. I doubt they would be too chuffed at you paying this back earlier and them getting less money.

Direct Debits by their nature are variable, what they meant to say was that they are not interested in increasing the monthly payment and getting less cash back from you so they fobbed you off with a story about standing orders then reduced your DD payment to compensate for this.

I suspect they will throw a strop about you cancelling the DD and try and charge you some sort of fee.

Have a look at your finance agreement to see what that says about paying off the balance early.

pocohontas

Thanks for that. It wasn't set up as a loan exactly - I was given a store card - and so my balance will change depending on whether or not I go on to buy other things. I don't think I'll even be able to find the original agreement but don't those sorts of things generally rely on you making the minimum payment at least? Starting to think perhaps I did make a boo boo!

Glad

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pa49

If you can, then re finance it over as short a period as poss with your "new" higher monthly payment as the criteria.
You could save on the interest!

angelatgraceland

Surely if its a store card you get a monthly statement with a paying in slip?
You should be able to make extra payments as you please each month with the payment slip. Are you sure it is a store card? Do you actually have it? Looks like a credit card? If you get monthly statements there should be details on the back regarding interest and payments.
Each statement will tell you the min payment and the date it must be paid by. If the min payment is not made they will charge you a penalty fee-usually approx £30 plus interest. Make sure you are getting your monthly statements.
Store cards are very high interest generally-find a credit card offering 0% and transfer the balance to it for however long they are offering 0% rate. The new card will charge you about 2% of the balance transfer to do this but thats way less than the interest you are paying and its a one off payment. when the 0% is due to finish try to transfer it to another new card also offering 0%. If you cant do this at least either get a low interest loan or a cheaper credit card because that is what as tore card is-its a credit card. Read Martins tips on TARTS and credit cards.