Home Loan secured against property

[Wheels60]

Hi Zillack,

 

Sorry to be so long responding, there have been some major developments. I honestly don't recall whether the bank asked for proof of ID on either occasion, but they don't seem to have any do they as they asked us to go to the nearest branch and take passports or driving licence to them. Needless to say we did not do this.

 

I have now received further communication from the Debt Collecting Agency. In this they say that the Bank had made some errors. They say that some of the payments from the Insurers were paid into the current account as long ago as 2006, and were not credited to the loan account. I find this hard to believe as the loan people are very quick to make contact if a payment is late. My records show that when this current account was placed in my Debt Management Program in October 2007, it stood just below the agreed overdraft limit of £5,000.

 

By readjusting the figures, the Bank now states that the overdraft was way above that at the time it was placed in the Debt Management Program. Bear in mind that in October 2007 I wrote to the Bank and instructed them to cancel ALL standing orders and direct debits from that account.

 

In addition to that, the Bank has taken all 24 of the remaining payments due on the loan from the current account. Bear in mind that the last payment on that loan was due in January 2012. In fact they seem to have taken more than was needed as the loan account now stands some £1,200+ in credit according to their new revised figures. By so doing, they have massively increased the alleged overdraft and are applying punitive interest rates of some 17.5% to that debt. Currently it stands at £66,000+. So they have managed to turn a £13,500 debt (£5,000 Personal Account + £7,500 Loan Account) into £66,000. But very kindly they have offered to settle for half that.

 

By my calculations, the total interest due on the loan amounts to some £5,000+. The Bank have now taken all that two years ahead of schedule, and are now charging interest on the interest via the Current Account.

 

Surely this cannot be legal?

 

I hope you read this soonest, and can offer some useful advice. Meantime I have responded to the Debt Collectors voicing my objections, disapproval of their methods, and querying the legality of the steps they and the Bank have taken.

 

Wheels60

[Wheels60]

Hi all,

 

I posted about this problem a while ago, and postggj and Zillack gave me some good advice. It was Natwest Bank, with whom we had a joint current account and a home loan. The Home Loan was in my wife's name alone. After getting into financial difficulty, I placed the current account in a Debt Management Program. That was Oct 2007. Natwest said they had not formally agreed the offer, but were accepting the payments from the Debt Program. I was under the impression that that account had been 'Frozen'.

 

The Home Loan was paid by PPI until Jan 2010, but that left another 24 payments still to be made. I queried the amount showing as outstanding on this loan, as it far exceeded the total of the 24 payments still due, but got no response. Following advice from postggj, I wrote to them asking for copy of the original agreement enclosing the fee of £1.00, this request was signed by both my wife and I. Their response was that they could not process the request as they did not have my wifes signature on record, and they asked both of us to go to one of their branches to present ID etc. We did not do this.

 

We have now received a letter from the Debt Collectors. This letter states that the Bank has now discovered some errors on the current account insofar as some of the payments from the insurers were paid into the current account, but were not transferred to the loan account. Having recalculated the statements, that now puts the current account way over its agreed overdraft limit as far back as early 2006. I find this hard to believe as the loan company were quick enough to inform us if we fell behind with payments at any stage.

 

In addition to that. Natwest have paid all 24 of the outstanding payments on the loan out of the current account. That loan agreement was due to conclude in Feb 2012. They have then imposed punitive interest rates on the whole amount against the current account. By so doing, they have turned a debt which was £13,500 (£5,000 current account overdraft + £7,500 due in payments on the loan account) into £66,000+. They have kindly offered to settle for half....

 

Surely this cannot be legal? Can anyone suggest anything?

 

Wheels60

[ltc1607]

sub

[phrang888]

Hi all,

 

The Home Loan was paid by PPI until Jan 2010, but that left another 24 payments still to be made. I queried the amount showing as outstanding on this loan, as it far exceeded the total of the 24 payments still due,

 

This happend to me a few years ago.

 

Took out a home improvement loan with GE, made a claim against the PPI, the insurers accepted my claim and made the monthly repayments directly to GE albiet late and in arrears.

 

In turn GE added 'additional contractual interest' to my account as a result of arrears incurred by 'the insurance company's failure to make the contractualy due instalment, on the contractualy due date'.

 

I took legal advice which was, 'I am of the opinion that the the insurers are liabable for any additional interest that was added to Mr xxxxx's account that was attributble to the insurers conduct', it went on to say, 'the most cost effective way to proceed would be to bring a compliant to the attention of the Ombudsman'.

 

Subsequently, the Ombusmans [insurance Division] upheld my complaint and i was compensated by the insurance company for all the additional interest so added, I also recieved £800 for distress and inconvenience.

 

I then reported GE to the OFT who filed my letter under evidence of an 'unfair' business practice.

 

Firstly, write to the insurers for a breakdown of monthly claims, i.e. when the monthly entitled benefit payments were forwarded to the Bank.

 

Then write to the Bank complaining that you are not liable for any arrears incurred during the period the monthly repayments were being made under the PPI.

 

They will come back with the usual xxxx of 'oh yes you are', then complain to the Ombudsman [insurance Division].

 

I will take time, but hopefully it may be the leaver that will help you negotiate a settlement.

 

Hope this is of help

 

PH

[Wheels60]

Hi all,

 

My thanks to the last post for that advice.

 

Let me give you a little update. I had two accounts with NatWest, one was the loan account secured on the property, the other was a current account.

 

When I got into financial difficulties, I placed the current account within a Debt Management Program. NatWest did not accept the offer made by the Debt Managers, but accepted the regular payments and agreed to 'Freeze' the interest on the account. The loan was paid by PPI for two years, and then the problems started as there were still payments due.

 

I wrote to NatWest regarding the loan as the amount demanded for settlement far exceeded the total of all the repayments still due. There was no explanation forthcoming. I wrote to them asking for a copy of the original agreement enclosing the required fee - they returned my letter and fee saying they could not process my request as both my wife and I had signed the letter and they did not have her signature on file. That was interesting as the loan was in her name. I wrote several times more asking for copy of the agreement, I received no response.

 

Finally I got a response from the Debt Collecting Agency. It said that due to my enquiry asking for an explanation of the amount demanded for full repayment of the loan, the Bank had made some investigations and recalculated everything. They claimed that due to an oversight, the Bank had failed to transfer some of the payments made by the PPI into the current account from that account to the loan account (They went back two years). Note that the statements I have for the loan account do not show any missing payments.

 

Also, they had taken ALL the payments due to complete the loan AHEAD of time, from the current account, putting it massively overdrawn, and charged hugely inflated interest rates on all that having presumably classed it as 'Unauthorised Borrowing'. In such manner they had turned what was a £1,500 overdraft on the current account into in excess of £62,000 !!!

 

My response to them contained a number of points.

• When I placed the current account with Debt Managers, I instructed the Bank not to authorise any further payments from that account.
  
• I should NOT be penalised by means of extra interest charged for mistakes the Bank made many months after the event.
  
• I thanked them for transferring the whole debt on the loan account which could not be placed with Debt Managers as it was secured on the property, to an account which was ALREADY in the hands of Debt Managers.
  
• The Debt Managers had correspondence from the Bank advising them that interest had been frozen on the current account.
  
• I reminded them that I had requested copy of the original agreement several times without success, and that if they could not provide that they had no basis to make any claim against me.
  

 

That was several months ago now, and I have heard nothing since.

[phrang888]

Hi all,

 

My thanks to the last post for that advice.

 

Let me give you a little update. I had two accounts with NatWest, one was the loan account secured on the property, the other was a current account.

 

When I got into financial difficulties, I placed the current account within a Debt Management Program. NatWest did not accept the offer made by the Debt Managers, but accepted the regular payments and agreed to 'Freeze' the interest on the account. The loan was paid by PPI for two years, and then the problems started as there were still payments due.

 

I wrote to NatWest regarding the loan as the amount demanded for settlement far exceeded the total of all the repayments still due. There was no explanation forthcoming. I wrote to them asking for a copy of the original agreement enclosing the required fee - they returned my letter and fee saying they could not process my request as both my wife and I had signed the letter and they did not have her signature on file. That was interesting as the loan was in her name. I wrote several times more asking for copy of the agreement, I received no response.

 

Finally I got a response from the Debt Collecting Agency. It said that due to my enquiry asking for an explanation of the amount demanded for full repayment of the loan, the Bank had made some investigations and recalculated everything. They claimed that due to an oversight, the Bank had failed to transfer some of the payments made by the PPI into the current account from that account to the loan account (They went back two years). Note that the statements I have for the loan account do not show any missing payments.

 

Also, they had taken ALL the payments due to complete the loan AHEAD of time, from the current account, putting it massively overdrawn, and charged hugely inflated interest rates on all that having presumably classed it as 'Unauthorised Borrowing'. In such manner they had turned what was a £1,500 overdraft on the current account into in excess of £62,000 !!!

 

 

My response to them contained a number of points.

• When I placed the current account with Debt Managers, I instructed the Bank not to authorise any further payments from that account.
  
• I should NOT be penalised by means of extra interest charged for mistakes the Bank made many months after the event.
  
• I thanked them for transferring the whole debt on the loan account which could not be placed with Debt Managers as it was secured on the property, to an account which was ALREADY in the hands of Debt Managers.
  
• The Debt Managers had correspondence from the Bank advising them that interest had been frozen on the current account.
  
• I reminded them that I had requested copy of the original agreement several times without success, and that if they could not provide that they had no basis to make any claim against me.
  

That was several months ago now, and I have heard nothing since.

 

 

 

Hi again,

 

I am not a legal person and therefore can only help with the circumstances of the PPI claim you made.

 

However, if you click the red triangle at the bottom of this page it will bring your questions to the attention of a member of the site team who have a lot more knowledge than me on the further issues you raise.

 

Hope this is of help.

 

Kind Regards

 

PH