Blemain/ Together

Aozard · 15 February 2019 at 1:53PM

I stupidly when younger with my then partner took out a loan with Blemain to try and renovate our home. After many problems with them having the wrong payment date on file even though they took the money out on the right date each time (on file they had 21st but took payment on the 31st). They also still did not correct my wife's name even after sending our marriage certificate to them a year into the loan. I recently missed a payment and so rang up to pay it. To my surprise they told me that my loan wasn't in line to finish on its course. When i asked what he meant he told me that the loan was due to finish next year in August, which is correct. However there were charges on the account totaling £12,000, which if i wanted to be in line with paying off would need to increase my payment more than 3 fold.

I requested a break down of these charges and when i received them they total £2,000 and they tell me the rest is interest as the charges go back to 2006 and upwards. The shock is just jaw dropping....... a loan which was only £15K which we have so far paid back over £35k for is now an additional £12k on top. I am just lost for words and have no idea what i can do. I am very sure that come August next year they will demand either the 12K or force us to sell the house. Any advice on what i can do would be greatly appreciated.

:(:(:(:(:(:(:(:(:(

[Deleted User] · 15 February 2019 at 1:59PM

Your options are to find the money to make the payments, sell the house, refinance or come to another arrangement to pay them.

Check that the statement is correct, but high interest loans do attract a lot of interest - especially over such a long period.

Bermonia · 15 February 2019 at 2:02PM

I suppose first question is what do the £2k in charges relate too - if they have been incorrectly charged then that resolved the interest issue too?

System · 15 February 2019 at 3:40PM

I'm assuming you borrowed £15000 over 15 years?

Bank of England Base Rate in 2004 was 4.75-5%. A £15k 15 year loan at 7.5%, which back then was a quite low mortgage interest rate and as a loan would have been quite cheap, would have a total amount to be repaid including interest of £46,041 in line with what you will have repaid by August.

The problem we have with long loans going back that far is they seem expensive now because we've had a decade of BoE interest rates below 1% so 7.5% seems horrific. The mistake you made was not remortgaging anytime in the last decade to clear off this loan and refinance at 2-3%.

sourcrates · 15 February 2019 at 4:01PM

To of accrued £2000 in default charges, you must of missed payments previously, or some payments have been late, the thing is, if these charges are not paid straight away, they accrue interest, at the same rate as your loan, and over time, this has turned into quite a substancial amount.

Did the lender inform you of the charges originally, and ask you to pay them ?

DoctorStrange · 15 February 2019 at 6:35PM

I think you should request every detail they have on your agreement with them, and be clear with them that you are entering a dispute and will be seeking legal advice.

It's difficult to offer much advice based on what you've posted, but one area to look at may be the differences in expected pay dates and actual pay dates.

If they expected payment on the 21st, then they may have started adding penalties and interest each "late payment" every month. These could have accumulated over the years and, as your payments were based only on the original loan and interest, have left a balance.

Did they send you regular statements, or otherwise bring these charges to your attention?

D_M_E · 15 February 2019 at 10:15PM

If the pay date was the 21st but they did not take payment until the 31st they must have been adding late payment charges as a result of this.

This means that they have penalised you for their own incompetence.

If the only late payment was the one you made over the phone then there should only be the one penalty charge.

You need to read your original terms and conditions and see what is laid out in there about timescales for penalties,.

You should also raise a complaint with them then escalate it to the FCA after 8 weeks and let them make a decision on their "penalties and interest" and see what comes of from that.

Bermonia · 16 February 2019 at 1:43PM

You do not escalate to the FCA - they do not consider individual cases, if after 8 weeks you remain unhappy with lenders response you would raise a complaint with The Financial Ombudsman Service (FOS).

Blemain/ Together

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