I've posted this on a separate topic but I think it's also pertient to this. I have a secured loan with GE Money that has increased this week by 1.95% to 13.15% Their letter states "Our Base Lending rate is linked to how much it costs us to borrow money, which we then lend to our customers. Our decision to increase our Base Lending Rate was based on the cost of the wholesale funding markets. We have seen significant instability in the financial markets, which has resulted in a considerable increase in the rates we are charged when raising money to lend to our customers.... As you may know GE Money is not a UK Bank....You may also be aware that our Base Lending Rate is not linked to the Bank Of England base rate or the LIBOR, and therefore moves independently of these rates.... the recent BoE rate cuts and LIBOR moves have no direct link to our cost of funds" This basically sounds like an organisation that can pretty much do what it wants with it's interest rates - and that of course, wouldn't include looking after it's customers!

About 18 months ago we took out a secured loan with GE Money. Last week we received both a pleasant and an unpleasant surprise - in the same postal delivery we were told that our C&G mortgage repayment was reducing to the lowest ever, but that our GE Money loan was rising to the highest ever! Perhaps I should have known that GE Money's rate is NOT linked to the Bank of England Base Rate, nor to any Base Rate. It is linked, apparently, to "how much it costs us to borrow money, which we then lend to our customers..... We have seen significant instability in the financial markets, which has resulted in a considerable increase in the rates we are charged when raising money to lend to our customers. In addition our funding is raised via the wholsesale markets, which means that the recent BoE base rate cuts and LIBOR moves have no direct link to our cost of funds" The interest rate that I am currently paying is 13.15%, an increase of 1.95% (there was also an earlier increase from the original rate when the loan was established). I cannot of course, validate GE Money's statement because there is nothing for me to check against! There is nothing in the letter to indicate that I can close the loan without incurring early repayment charges as you can, I believe, with credit cards when the terms change, therefore unless I want to pay a hefty charge I assume that I am stuck with this for a while longer. SO.... if you are considering GE Money I would seriously advise you to look elsewhere.... unless you are happy to give your business to a company that appear to be able to raise their rates unconditionally and without needing to justify or prove the increases to their customers.

Hi Everyone I'm finding all of this a bit daunting to be honest. I've banked with the Co-op for more years than I care to remember (and some of those years were pretty fraught financially!). I have a current a/c with overdraft, personal loan with Payment Protection and Credit Card with Payment Protection - if they were to pull the plug on these at short notice I reckon that I would be in a mess! On a separate issue, I noticed that the minimum payment on my Credit Card was less than my monthly charge - effectively increasing my balance each month (a nice earner for the bank!) - anyone else noticed this? I'm off to browse the site and build up the courage to proceed....