New To This Help Stop Interest

lawsntam

Hi I'm currently in a debt management plan and have been for 2 1/2yrs. We have debt of over £28,000. I didn't want to go Bankrupt and after lengthy consideration decided not to do an IVA. I spent this money after going abit crazy and therefore must pay it back. My problem is LLoyds have decided now to restart charging interest on the Creditcards I have with them. The amount I pay them per month is less than the interest they are going to charge so why???? have I bothered to try and pay. Can anyone help me please to stop the interest

LilacPixie

who is your DMP with?? Have you tried contacting them to ask their advice??

National debtline have some nice sample letters for freezing interest as well.

LilacPixie

Here is a letter from NDL that may help you.


Account No:

**************

Thank you for your letter of 01-01-2002 concerning the above account.
We are sorry that you feel unable to suspend interest charges on the above account. The majority of our other
creditors have agreed to the offer of payment and agreed to suspend any interest charges still accruing. They
have accepted that to continue to charge interest would not assist us in our present financial difficulties and
can only serve to increase our total debt.
As you are aware, we have already paid considerable sums in interest to our account. If interest charges
continue, the monthly instalments we are paying will not even cover that interest. Also, the co-operation of
our other creditors who have agreed to freeze interest already would be put at risk.
We would therefore be grateful if you would reconsider your decision not to freeze the interest. This would
mean that the monthly payments we make would actually reduce the balance outstanding to your company.

We look forward to hearing from you as soon as possible.

In the first instance tho I would be asking whoever does my DMP for advice.

Fairycake_2

Hi

It sounds like the same thing that I am dealing with - I am on a DMP and not an IVA and in November (an RBS run credit card) after 14 months of my DMP and no matter how many calls I made they weren't interested - apparently 12 months is the time they give you interest free so that you can "get back on your feet financially"!

I also called the National Debtline who told me that HBOS and Lloyds have decided that they will not be suspending interest in the future. Apparently all of the debt management agencies told that that this was a riduculous idea but they just don't care and see it as a way to get their money back quicker.

I had a solicitor friend write several letters which were also ignored - until I wrote to them saying that I was involving the Financial Ombudsman.

The letter says that they have now decided that my debt is "long term" (even though I told them this months ago!) and they will be referring my debt to a recovery agency. They answered none of my concerns so I am still going to take it further with the FSO.

All I can advise is keep fighting them - I strongly advise that you send your complaint to the FSO (the form is online) as this will prompt them into action. I'll put the letters onto this site too if you want to have a look.

The more of us who fight this, we might be able to make a change.

Good luck.

Fairycake_2

Dear Sir/Madam

Account No:

You have recently been in touch with regard to the above account.


As you are aware we have an agreement through Payplan to make payments to creditors and this has been in place since . I have been told by your staff that your terms and conditions only allow for one year interest free to enable your customers to "get back on their feet financially". However, you continued to take payments beyond the one year anniversary --- at the agreed rate without adding interest, thereby impliedly accepting continued payment under the previous terms.


I am sorry that you feel unable to suspend interest charges on the above account. All other of our other creditors have agreed to the offer of payment and agreed to suspend any interest charges still accruing. They have accepted that to continue to charge interest would not assist in our present financial difficulties, and can only serve to increase the total debt. Therefore, you are not allowing us to service her debt and there will be no 'light at the end of the tunnel' and less incentive for us to keep up with the payments.


As you are aware (and despite several phone calls to you) considerable sums in interest have already been applied to the account, which is making the problem worse as the monthly instalments we can afford to pay do not even cover that interest. You are also compounding the problem by adding late payment charges to the account as the payment does not coincide with your payment date.


Your continued insistence that we either raises her payments or pays the debt in full (even if she has to borrow the money (as was suggested by one of your staff)), puts in jeopardy the co-operation of other creditors who have agreed to freeze interest.


I would therefore be grateful if you would reconsider your decision not to freeze the interest. This would mean that the monthly payments we make would actually reduce the balance outstanding to your company.


I look forward to hearing from you as soon as possible. Should this matter not be resolved we will be forwarding all correspondence/evidence of payments to the Financial Ombudsman for resolution.


Yours faithfully

Fairycake_2

Dear Sir/Madam

Account No:

Further to my letter to you of ---, a copy of which I attach for your information, I am writing with regard to your lack of response.

As you are aware this issue has remained unresolved since ---- which is unacceptable. I am writing to inform you that should we not receive a satisfactory response to the points raised in our original correspondence, we shall have no choice but to take this matter to the Financial Ombudsman.

The FSA's 11 Principles for Business are a code by which banking institutions should adhere and that principle number 6 states that "a firm must pay due regard to the interests of its customers and treat them fairly" and in this case I think that this is sadly lacking.

If we do not hear from you within 14 days, we will be forwarding all relevant information to the Financial Ombudsman.

I look forward to your prompt response.

Yours faithfully

hogman1976

Hi! I posted an all most identical post a couple of days ago! Its my boyfriend debt and he too had been paying it off for a couple of years (£20,000) and now the halifax has re-added the interest! Its very disheartening when you thought then end was nearly in sight! It does make you wonder why you make the effect to pay all the money back and not go down the IVA road!!! Keep posting to let me know how you get on..... (will do the same ) )

bank_of_slate

LILAC
I would delete the account number that you posted and replace it with ********* instead, you never know who's looking!
...Linda xx

lisabell

Hi

I too am in the same position i have been on a DMP for over a year now and most of my creditors 13 in all have all started adding interest again which like you means my payments hardly cover the charges.
When i talked to my DM company they said that creditors do not legally have to freeze interest and that they have shown grace by doing it for a year i now have decided to go for an iva after great discussion.
Also my DMP company said that even at the end of the dmp term they can still turn round and add all the interest on in a lump sum i guess thats the problem with a dmp its not legally binding.
I do wish you luck and hope you can get some sense out of your creditors

louietudor

lawsntam wrote: »

Hi I'm currently in a debt management plan and have been for 2 1/2yrs. We have debt of over £28,000. I didn't want to go Bankrupt and after lengthy consideration decided not to do an IVA. I spent this money after going abit crazy and therefore must pay it back. My problem is LLoyds have decided now to restart charging interest on the Creditcards I have with them. The amount I pay them per month is less than the interest they are going to charge so why???? have I bothered to try and pay. Can anyone help me please to stop the interest

i suspect they want to default you so after 3 months they can sell the debt to DCA

Fairycake_2

Louietufour I think you are right. It seems that many creditors are jumping on the bandwagon and trying to squeeze us for more money. I think it very unfair when we are trying to pay back all the debt and not take the IVA route which means that they actually loose money.

In an update to my original post - I have finally had a response from HBOS regarding my situation (strange that it happened just after I informed them I had taken my complaint to the ombudsman!) and it was rubbish. It answered none of my queries or complaints so I have sent another letter to them.

One of the points was that (and I quote) "we now consider your difficulties to be long term, and feel that referring your account to a debt recover agency for future payment monitoring is in the best interest to you". I told them that this wasn't a short term problem way back in December (as being on a DMP this should really be obvious).

I think that everyone having this problem should take the matter up with the Financial Ombudsman and see if we can make a change.