Amigo loans help please

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  • sourcrates
    sourcrates Posts: 28,870 Ambassador
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    Niw132 wrote: »
    Hi, about 4 months ago we were in a situation where we needed a car to get to work as our old car give our. Having terrible credit I went to amigo loans for a £3000 loan. The terms were it was 146.70 every month. I had a look recently at my statement and today noticed my balance had went up to above 3000 and we’ve been paying into it for 4 months. Admittedly I didn’t read any of the small print at the time and have come to the conclusion I’ve been totally screwed over. I’m paying 146 per month and 100 of that is just interest. It’s give me heart Palpitations just thinking of it. Does this sound correct? And maybe I’m extremely naive but surely that is not legal? Any advice really appreciated.


    Hi,


    As with most loans, the interest is front loaded, so basically you pay back the interest first, then the capital amount.


    Are you able to afford the loan repayments, because if you can`t, your guarantor is not going to be best pleased.


    With a bad credit history, you must of known sub prime lending was your only option.
    I’m a Forum Ambassador and I support the Forum Team on the Debt free wannabe, Credit file and ratings, and Bankruptcy and living with it boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.For free non-judgemental debt advice, contact either Stepchange, National Debtline, or CitizensAdviceBureaux.Link to SOA Calculator- https://www.stoozing.com/soa.php The "provit letter" is here-https://forums.moneysavingexpert.com/discussion/2607247/letter-when-you-know-nothing-about-about-the-debt-aka-prove-it-letter
  • [Deleted User]
    [Deleted User] Posts: 35,242 Forumite
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    sourcrates wrote: »
    Hi,


    As with most loans, the interest is front loaded, so basically you pay back the interest first, then the capital amount.

    No loans are front loaded. Interest is charged daily on the outstanding balance.
  • sourcrates
    sourcrates Posts: 28,870 Ambassador
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    Deleted_User wrote: »
    No loans are front loaded. Interest is charged daily on the outstanding balance.


    As the principal balance at the start of the loan is quite large, you pay more in interest, as the balance decreases over time, you pay less interest, maybe i did not make that very clear.
    I’m a Forum Ambassador and I support the Forum Team on the Debt free wannabe, Credit file and ratings, and Bankruptcy and living with it boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.For free non-judgemental debt advice, contact either Stepchange, National Debtline, or CitizensAdviceBureaux.Link to SOA Calculator- https://www.stoozing.com/soa.php The "provit letter" is here-https://forums.moneysavingexpert.com/discussion/2607247/letter-when-you-know-nothing-about-about-the-debt-aka-prove-it-letter
  • [Deleted User]
    [Deleted User] Posts: 35,242 Forumite
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    That's correct, but it's not front loading, which was banned several years ago.
  • sourcrates
    sourcrates Posts: 28,870 Ambassador
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    Deleted_User wrote: »
    That's correct, but it's not front loading, which was banned several years ago.


    Just my incorrect use of words ZX :D
    I’m a Forum Ambassador and I support the Forum Team on the Debt free wannabe, Credit file and ratings, and Bankruptcy and living with it boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.For free non-judgemental debt advice, contact either Stepchange, National Debtline, or CitizensAdviceBureaux.Link to SOA Calculator- https://www.stoozing.com/soa.php The "provit letter" is here-https://forums.moneysavingexpert.com/discussion/2607247/letter-when-you-know-nothing-about-about-the-debt-aka-prove-it-letter
  • [Deleted User]
    [Deleted User] Posts: 35,242 Forumite
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    Forgiven for this one time only. :)
  • dealer_wins
    dealer_wins Posts: 7,334 Forumite
    Not legal lol Why not go to the firms that charge 4 figure APRs, like Lending Stream etc tc. They make Wonga look cheap!!!
  • Clive_Woody
    Clive_Woody Posts: 5,855 Forumite
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    tonycottee wrote: »
    I disagree. A good time to read the small print is before you sign.

    Not that it helps, but avoid Amigo Loans like the plague.
    Unless you have access to a time machine that option is no longer available.

    Now would be a good time for the OP to read the T&Cs to see what they agreed to.
    "We act as though comfort and luxury are the chief requirements of life, when all that we need to make us happy is something to be enthusiastic about” – Albert Einstein
  • foxy-stoat
    foxy-stoat Posts: 6,879 Forumite
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    You have several options;

    Keep paying the contracted payments and pay a total of £2269 in interest payments.
    Sell as much stuff as you can, and overpay the loan.
    Stop paying and let your guarantor pay for it.
  • bearcat16
    bearcat16 Posts: 339 Forumite
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    edited 11 July 2018 at 1:12AM
    Now that you are not in a rush (as you were when the car broke down) maybe you could shop around for a more reasonable rate loan if your situation has improved, though 4 months is only a short time.

    Another option is this: get your settlement figure from amigo.

    Then ask your guarantor (let us call him Kevin) to apply for a loan for that amount with a mainstream lender (eg Tesco etc) where the apr is about 3%.

    Then, get Kevin to pay off the amigo loan with the Tesco loan.

    Now, make your (much lower) monthly loan payments to Kevin instead of amigo.

    And if Kevin says ==wait a minute matey, I did not agree to getting a loan for you and lending you money== you can say ==but Kevin, old pal, you already are doing that. You are liable for the amigo loan. If I just feel like not paying it anymore it is you they will come after. It is really your loan.

    The only difference with a Tesco loan is that the interest is much lower, and therefore I am more likely to be able to afford the payments. It is in your own interest to reduce your exposure.==

    Hopefully Kevin will say ==hmm I see your point== and get on the phone to Tesco right away.
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