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Hello, I am new to this forum so hopefully this is an ok area to talk about this!
I have a joint loan, two joint bank accounts and a credit card, with a combined debt of just over £16000, all with HSBC. The debt is now in default and I have until next week to negotiate a managed loan with the bank. The joint debts are with my ex who is refusing to pay anything and it looks unlikely that he will pay anything in future. I am on income support, so have a limited income and have tried negotiating with HSBC which has proved ridiculously frustrating. I have also talked to CCCS, but was unhappy with the fact that they decided that I had £341 spare cash per month to put towards all the debt.
The bank, however have given me three different payment amounts. One of 290, one of 213 and another of 149. They don't seem to have all the details on their system of one of the proposed payments, which they sent to me in writing. I am hoping to talk to a branch today to get to the bottom about it.
The biggest worry about the managed loan for me though is the interest. In the letter I was told I would have to pay 12.7% of interest which would equate to over £14000 over the next 12 years if paid back at £213 per month. On the phone, they said that I would have to sign the doc which states the interest, but the real interest rate would be 0% due to my financial situation, but subject to change within 6 months if my circumstances change. It is all so confusing, they have been giving so many mixed messages and I simply don't know what to do. Does anyone have any advice? Many thanks in advance!
hi iseult...
welcome to the forum.
i haven't been around much lately - as nearly all the cases are on hold due to the big bank charges court case which you may have heard about.
when i was actively involved in this forum - my stock advice for anyone in the position of being pressured into a managed loan was - don't do it!!! run for the hills!!! keep as far away from it as humanly possible!!!!
we have seen probably hundreds with the same problem - suckered into this ever spiralling debt - it is nothing short of involuntary servitude and my position on it has not changed one iota.
my son had one - through bad money management and youthful financial blindness -
it serves no useful purpose except to make money for the bank.
it won't solve your debt problem.
my advice at this point would be to take your facts and figures and get round to citizen's advice where they could possibly point you towards a reputable debt payment help service. but please don't do the managed loan.
not to frighten you - but here is a very long thread on HSBC managed loans - story after story about them: Who has had Managed Loans?
i'm sure some of the guys on here will be along to help you with this - but i didn't want you to think no one is answering your query.
there is a very good core group of thinkers on this forum - i will point out your thread to them and they will be along to give you some concrete help. good luck
Latty has covered all the main points you need - I would say resist a Managed Loan with all your might - there are some horror stories on that link she gave you ........ basically you're paying forever and getting nowhere.
I agree that you need to see the Citizens Advice Bureau as soon as possible .... they have a good debt management service ....
Also ,if your money is being paid into HSBC you'd be better to open a parachute account with another bank , so that you can manage your day to day expenditure (but don't go overdrawn) without HSBC taking it .
Here's a link for you ;
Advice & opinions given by johnnymitch are personal, are not endorsed by Consumer Action Group or Bank Action Group, and are offered informally, without prejudice & without liability. Your decisions and actions are your own, and should you be in any doubt, you are advised to seek the opinion of a qualified professional.
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Lattie is right, if you sign onto a managed loan you will be in debt for life, the interest rates are horrendous and you will be doing nothing but paying interest to the bank and leaving them with the original debt to wave over your head and threaten you with.
I agree with Lattie, you should go and see CAB or phone the National Debt Line (0808 808 4000) if you are being pressurised by the bank.
For my own part I would ask how the debt is made up? how much of the £16,000 is penalty charges that you can dispute? are your loan and credit card agreements enforceable? and do they hold you and your ex jointly and severally responsible for the debt?
The first thing to do is try to reduce the debt by disputing your penalty charges and your loan and credit card agreements if they are not legally enforceable, its quite common to find they are not.
Once you have done this you can look at how much if anything you actually owe the bank.
Hi again iseult, I thought pete would be along with more good advice for you ..........
by Iseult: On the phone, they said that I would have to sign the doc which states the interest, but the real interest rate would be 0% due to my financial situation, but subject to change within 6 months if my circumstances change.
That is a carrot to get you in - then bang! they've got you....on a Managed Loan.
It is also not a good idea to speak on the phone, they'll only bully you into submission by threats of action......... put everything in writing - send recoreded delivery (so someone has to sign for it ) and if they phone you don't answer their security questions - that way they're not allowed to discuss your account.
Pete's idea of the National Debtline is also a good one - they have helped a great many people in your position - use them........
If you want to make a start to reclaim your bank charges here are links to the starter kit /templates:
Advice & opinions given by johnnymitch are personal, are not endorsed by Consumer Action Group or Bank Action Group, and are offered informally, without prejudice & without liability. Your decisions and actions are your own, and should you be in any doubt, you are advised to seek the opinion of a qualified professional.
If you think I've helped you please feel free to tickle my star
I went into a branch of HSBC today and the upshot is that apparently I have a loan agreement which is going to be sent to me stating that I will be paying 108 payments of £150 per month with 0% interest and I can top up the loan payments at any time. The bank manager and I were on the phone to them (why oh why can't everything be done at branch level) and I cross questioned the guy for about half an hour and it really does seem that this is the case. I am crossing my fingers that this is the case, because it would mean that there would be no interest for the life of the loan. I am going to talk to citizen's advice today on my options too and will give national debtline a call too. I really was not happy with CCCS and I found them to be snotty on the phone as well.
The debt is comprised of an overdraft on a joint account (£2170), an overdraft of about £175 (also joint account), a joint loan of over £11,000 and my own credit card which was paid regularly but there is about £3000 on that. I have worked out that there are a few charges that should be claimed for and I plan to do that, but certainly nowhere near the total amount that is owing. That is mainly down to my ex husband's spending unfortunately. Everything is unsecured and I am jointly and severally responsible for the joint debts.
It's annoying that it has gone into default because I presume there is a lot less that I can do. The funny thing was that the lady in the bank was nearly swearing down the phone at the incomeptence of the call centre guy!
I guess time is of the essence also, because I am worried that it will get to the final demand stage and it will go to the courts. Apparently I have until the 10th to respond to this loan agreement which I have yet to receive.
Well done on getting some action Iseult - no apologies necessary.......
If they cannot produce a copy of the Loan agreement that you signed then the loan is unenforceable in law.
Send a letter like this - suitably amended and see what they come up with :
Ask your creditor for a copy of your credit agreement under the Consumer Credit Act 1974
1 High Street,
Newtown,
Kent
R21 4RH
June 28, 2006
The Loan Company
Company House,
Church Street,
Newtown,
Kent,
R1 7HG
Dear Sir/Madam
Re:− Account/Reference Number 4563210025897412
With reference to the above agreement, we would be grateful if you would send us a copy of this credit agreement.
We understand that under the Consumer Credit Act 1974 (Sections 77−79), we are entitled to receive a copy of our credit agreement on request. We enclose a payment of £1.00 which represents the fee payable under the Consumer Credit Act.
We understand a copy of our credit agreement should be supplied within 12 working days.
We understand that under the Consumer Credit Act creditors are unable to enforce an agreement if they fail to comply with a request for a copy of the agreement under these sections of the Act.
We look forward to hearing from you.
Yours faithfully
Mr A N Other
PS - print your name - don't sign - they don't need a signature if they've been dealing with you all along - and it could save it from 'inadvertently' appearing on an agreement ......
Nemo me impune lacessit
Advice & opinions given by johnnymitch are personal, are not endorsed by Consumer Action Group or Bank Action Group, and are offered informally, without prejudice & without liability. Your decisions and actions are your own, and should you be in any doubt, you are advised to seek the opinion of a qualified professional.
If you think I've helped you please feel free to tickle my star
I guess time is of the essence also, because I am worried that it will get to the final demand stage and it will go to the courts. Apparently I have until the 10th to respond to this loan agreement which I have yet to receive.
Better to reply in chunks I think to save confusing you Iseult...
Make sure you tell CAB and/or National Debtline about the deadline - they'll be able to advise you how to get this re-scheduled........
Nemo me impune lacessit
Advice & opinions given by johnnymitch are personal, are not endorsed by Consumer Action Group or Bank Action Group, and are offered informally, without prejudice & without liability. Your decisions and actions are your own, and should you be in any doubt, you are advised to seek the opinion of a qualified professional.
If you think I've helped you please feel free to tickle my star
just looking at their offer alone - not the issues of what you owe it for and whether you want to take it up - but just on this one point alone -
150 pounds a month for 9 years (108 months). if (and that is a big if....
remember i'm just talking theoretics here) you were to agree to that - it's actually do-able i suppose but my word of warning here - you miss one penny off one month of that and i guarantee it will somewhere in the fine print that you will then and there be subject to some huge interest rate for the duration of the loan period. plus, take a look at the PPI section on this site - for the most part it isn't worth the paper it is written on - it takes an act of parliament for it to pay out - and traditionally they add that on automatically (also in the fine print) - be very, very careful. i for one would look at some other form of protection than to take their ppi - although again, i've been out of the loop for awhile and they may have cleaned up their act - but i doubt it.
again, this is just to keep you aware of the possibilities, i'm in no way saying to accept the offer - just more of a heads up on how it could go wrong for you. keep posting and john and pete will keep you on the straight and narrow.
hi isuelt do nto take the managed loan it is a huge ripped off !
i had severe debt problem, some of whihc are my fault due to my exceptionnally low budgeting skills.
their condition was that if i don't accept the manged loan then they will reconsider our business relatinship with them blah blahh.. and like a numptie and due to their agressive sales tactic i signed the dreaded managed loan not even considering what i was letting myself into
however HSBC offer me a managed loan after i loss my job and so the loss of one income ..... could not maintain the repayment and the interest keep on going and mounting plus charges .. at the end they still closed down my account cancelled all my DD all without warning .... result now i am BR.
iof i were you i will open an other basic bak account and myabe to a dmp with them.
have you contacted naitonal debtline the cab or cccs , they have soem good advise too !
I have a joint loan, two joint bank accounts and a credit card, with a combined debt of just over £16000,
Originally Posted by Iseult
I went into a branch of HSBC today and the upshot is that apparently I have a loan agreement which is going to be sent to me stating that I will be paying 108 payments of £150 per month with 0% interest and I can top up the loan payments at any time.
This is the second time I have seen HSBC do this. What you have been offered isn't a managed loan... well not in the sense that we know them on this forum. the total payment of £150 per month over 9 years at 0% interest comes to £16200 which is the figure you owe the bank, near as dammit .
Maybe they have realised loaning money to people who cant afford to pay them back or recovering money from people who's circumstances have changed isn't a matter of screwing them until they go bankrupt and only recovering a fraction of their money. Maybe some good has come out of the US sub prime market collapse after all.
Read and understand the terms of the loan they have offered you very carefully, especially the interest sections, can they vary the interest rate in the future? are any variations in rate linked to any index i.e. the Bank of England minimum lending rate? if you have trouble understanding their jargon ask a friend to read it too or come and ask us here .
I'd be very careful of the small print - just one late payment(which doesn't even have to be your fault) and they could 'restructure' the whole loan........
PS - hi pete !
Nemo me impune lacessit
Advice & opinions given by johnnymitch are personal, are not endorsed by Consumer Action Group or Bank Action Group, and are offered informally, without prejudice & without liability. Your decisions and actions are your own, and should you be in any doubt, you are advised to seek the opinion of a qualified professional.
If you think I've helped you please feel free to tickle my star
hi what can i say dont touch managed loan been there a lot of heart ache,i was lucky to get mine paid of read my thread it was a 11,000 loan in 2005 and last dec paid 10,000 odd to get rid of it,as i have moved banks kept very little in there so i could see my accounts as claiming back charges.now wrote to me and said i dont meet there criteria as i dont put money in now so closed it all down now,sent email saying the reason for me closing it down is i think they have treated me awful,bye the way its nice to see you all on here again.
Advice on managed loan please!
. The debt is now in default and I have until next week to negotiate a managed loan with the bank. The joint debts are with my ex who is refusing to pay anything and it looks unlikely that he will pay anything in future. I am on income support, so have a limited income and have tried negotiating with HSBC which has proved ridiculously frustrating. I have also talked to CCCS, but was unhappy with the fact that they decided that I had £341 spare cash per month to put towards all the debt.
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Originally Posted by Iseult
Re: Advice on managed loan please!
