F&Fsecured loan with Elderbridge - coerced debt and selling house

[Myfamily]

Hi 42Man, Thanks for the advice.

 

No there is no PPI, I am in a really tough situaion but I do hope for improvement in the next year or so. I don't know whether I can cahllenge them on their interest rates, do you think that i can? I can't rent as credit rating no good either. I'm just stuck!!

 

Can you advise me on the interest rates - do you think they would consider lowerng it for a while, if I paid them £500 thery're still earninga round 3% interest, I kno it's not as much as they would like to earn out of me but that's all i have. I'm not even sure now after checking the house prices in my area whether selling it would cover all of the first plus loan anyway!

 

Any help would be appreciated!

[slick132]

Hi MF - looking in as asked.

 

I don't see that you have grounds to challenge regarding the interest rates that you agreed to. Nor do I see think you'd get anywhere complaining that you weren't advised to seek advice before borrowing.

 

I think the Library Article about Financial Difficulty doesn't apply to secured borrowing, so I'm stuck with advice on this one.

 

Keep reading the forums to see if you can find some inspiration. Also, have you spoken to National Debt Line or similar - http://www.consumerwiki.co.uk/index.php/Debt:_Where_to_Get_Help

 

[Myfamily]

Thanks for having a look anyway Slick, I appreciate it.

 

I think I will try sending the letter and appeal to their better nature!! This is really a temporary problem we're having and maybe if I explain that it will help.

[dx100uk]

poss investigate what debts were refinanced into this loan?

 

might well have been PPI on those?

 

dx

[sequenci]

Thanks for having a look anyway Slick, I appreciate it.

 

I think I will try sending the letter and appeal to their better nature!! This is really a temporary problem we're having and maybe if I explain that it will help.

 

How temporary is it? There *could* be a few options here.

[Myfamily]

Hi Sequenci,

 

Sorry for taking so long to get back to you. I say temporary but it may be as temporary as you think mght be acceptable but here goes. Basically my partner has a son who is 15, he pays maintenance of around £500 per month for him (ordred by courts years ago when he got divorced) so this will stop when he's 18, so we're looking at about 3 years.

 

What do you think? once this has stopped we will be much better off and hopefully by then may have also paid of some other debts.

[sequenci]

Hi there. Sorry for taking an age in getting back to you. I've been away this weekend.

`It is usually the case that if a situation is temporary you may be able to seek a 'stay' on proceedings on the grounds that your situation is likely to improve in the near future. Sadly, three years isn't likely to be considered as temporary; so a couple of the ideas I had in mind are unlikely to work given your situation.

Do you have other debts such as loans, credit cards etc? if so then you could look to reduce those right down to £1 per month so you can free up as much money as possible for this secured loan. The key problem is that unless you can show that you can pay the regular secured loan plus a little extra on top the lender would be in their rights to look to repossess.

You can find some really, really good info here:

http://www.nationaldebtline.co.uk/england_wales/guide.php?page=guide-mortgage-arrears

[Myfamily]

Mmm, I see what you're saying but I have approx 18 years left on this loan so 3 years isn't that long is it? Would you mind telling me hat you're ideas were anyway?

 

I've been looking at the first plus complaints site and it seems that they are trying to get a test case together over the interest rates, which as everyone has said are very unfair, it was sold as variable and obviously we assumed like most people that they were based on the Bank Of England rate but apparently not. Perhaps I can explain to them my situation and buy myself enough time for this test case to go though.

 

Thanks

 

Myfamily

[sequenci]

That's an interesting point for sure. There is a lot built into 'fairness' within the Mortgage Conduct of Business Rules. To me it would be very unfair if their interest rate rules were anything but tied to the base rate. That's my take anyway.

[Myfamily]

So what do you think I can do now, I can afford £500,

 

They're still earning interest out of me!

 

I worked out that I have had this loan for approx 6 years and in that time have paid them about £60,000!

 

Even if I paid £500 for the rest of the term they would still get another £112,000 out of me

so all in all i would have paid them £172,000 for a 100k loan.

 

Can you help me with the wording of a letter to them?

 

I'm just stuck with how to put this to them.

[Surfer01]

Please be aware that although you pay them £500 just over half, the interest racked up will be very high as it will accumulate.

When we paid them most of our loan there was a shortfall of £5700 in 2006.

We have been paying £70 every month without fail yet our settlement figure 4 months ago was £4600!

If we pay FP £120 per month, after 6 months they refund us £50 x 6.

This organisation is very hard nose and out to bleed you dry.

Have you asked them for a settlement figure recently?

Probably not an option for you so this is only a suggestion,

but maybe selling the house,

renting one and then declaring yourself bankrupt may be the best idea.

This would get rid of FP and also the mortgage company if you were in negative equity plus any other debts.

Remember that if you have equity in the house and sell, the mortgage company get first bite and then FP.

After a year you can start all over again.

Tally up all your debts and work out your income and expenditure and have a think about it.

Six years later you could always buy another house as the bankruptcy would have dropped off your credit history.

Sorry for not being very helpful,

but it is difficult with FP involvement.

[Myfamily]

I understand what you're saying but I am worried about Bankruptcy because both my job and my husbands job would not be very happy!!

 

The negative equity problem would be solved in a few year as we live near to the new crossrail,

and property prices are set to improve significantly in those areas,

 

I would like to hang it out and sell up when we can cover the whole lot and of course when the kids are older,

 

Would that make any difference to them do you think?

[Surfer01]

To get them to agree to anything is going to be very difficult, but perhaps an income and expenditure sheet may help.

How will you income improve in the next year to catch up on the arrears because adding this in may help.

The biggest problem is if the loan is re-structured, it means more interest payments and you paying in off when you are in your seventies.

Is it possible to downgrade things like cars and buy old bangers?

Consider finding cheaper utilities like electric, water, gas and phones.

Do you really need a phone on contract, that is if you have one.

We sold both our cars, our caravan, changed suppliers and cut back on a number of things for about 2 years and avoided debt collectors etc by the skin of our teeth.

[sequenci]

Do you have other debts? this is an important question.

[Myfamily]

Yes, we do, but we have arrangements in place for all of them. Does this help?

[sequenci]

It does, massively.

If they are credit cards, loans, overdrafts - or any other form of credit debt you should really consider reducing all of those right down to £1 per month - as this will free up more money that you can use to pay your priority debts - such as this secured loan.

How much are you paying on the credit debts if you don't mind me asking?

[Myfamily]

I think the total each month is £105.

 

One of them is actually for a charging order where it was agreed at £40 per month

but i was planning on reducing the others to £1 per month.

but the £500 is taking that into account.

 

i have finished paying my car loan too which again i've taken into account.

 

what do you think?

[dx100uk]

might work

 

not got any penalty charges or ppi on your other debts to reclaim have you?

dx

[sequenci]

You should keep paying the charging order £40 but all others seek to reduce to token payments ASAP.

Is it a car loan or is it HP (the agreement will tell you this). If it's a loan then reduce that to £1 too.

[Myfamily]

I don't know about penalty charges but definately no PPI.

I will reduce all execept the chargin order one to £1 each.

 

The car loan has ended altogether so nothing more to pay them.

 

Can anyone help with wording this letter to First plus,

Can I use the letter B in the library,

i know it's for unsecured debs but will this be o.k. to use?

[Myfamily]

Hi again,

 

Well it's started again,

My last payment of the agreed amount went this morning and

Red castle have already tried to ring me on my landline and mobile immediately after.

 

I really need to get a letter out to them, I know they will just keep ringing from now on if I don't.

 

Can I use Letter B in the library for this - any advise please!

[Surfer01]

Quote them the Protection from Harassment Act 1997 and remind them it could be a criminal offence if they go contrary to it.

There was a case of a consumer taking BGAS to court and they won and got a big pay out from BGAS.

Tell them as from this point in time, you will only accept written correspondence however as the amount is in dispute,

they should be handing it back to Firstplus as per OFT.

You are under no obligation to tell them why you are disputing the amount owed as that is between you and FP.

I would do that even if it I was only disputing 10p.

Probably do it even if I was not disputing the amount owed just to get rid of DCA.

With us they have to comply with an instruction from FOS to keep everything in writing and not to converse by phone.

They were naughty recently and are sending us a cheque for £150!

[Myfamily]

Mmm, that sounds scary!!

 

So should I send that letter to Red castle then can I send a letter to First plus offering the £500 that I can afford each month?

I'm so worried about all this,

 

I just need to hold all this off or around 3 years and get back on my feet,

 

I just don't want them to try and take my home!

[dx100uk]

iknow you've got 1001 things on your mind regarding this and its a worry

 

but a good source of income might well be

reclaiming on old closed accounts or your other existing debts.

 

this might well give you unexpected income to use.

 

dx

[Myfamily]

Hello, again,

 

Just got this e-mail from Red Castle

 

"We have been trying to contact you with regards to help being offered from our client.

We are limited on time with this so please contact a member of our team on 01903 534207 before the end of this month to discuss further.

Regards,

Red Castle"

 

What do you all think??