What's the difference between an HSBC managed loan and a normal loan?

[gemspan]

Reading in THe Scotsman today that HBOS are on set for record full year profits. They are in line to make pretax profits of 5.35 billion.

 

The release of this information is badly timed. I wonder just how much of this money is made from unfair bank charges. I also wonder what their profits will be next year when they have to pay them all back!!!!

 

Gemspan

[gemspan]

HI

 

Once I have dealt with the rest of the creditors I will be turning my attention onto HSBC. I have this week received 2 letters advising me that they have declined my unauthorised overdraft application and have returned 2 direct debits at the cost of £25 each - and they have cancelled the DDs.

 

This is new wording and does anybody think that this is HSBC trying to get around the unlawful charges by deeming this to be an unauthorised overdraft fee?

 

I just wondered what the more experienced thought.

 

THanks a lot

Gemspan

[jimfishybob]

It seems fairly standard to me.

 

An 'unauthorised' overdraft fee IS a penalty charge and should be dealt with as such.

[gemspan]

Thank you for the advice. Because this is new wording I wondered if it was their way of trying to get out of the unlawful charges.

 

I watched The Money Programme during the week and thought it was laughable that the banks are now trying to say this is a service they are providing and therefore they are not unlawful charges!!!!! Thought HSBC were trying to get in on the act and change their goalposts.

 

Thanks a lot

Annie

[steve_n]

Hi Annie,

 

How on earth can it be a 'service' ?? for WHAT - the few micro seconds it takes computer to automatically monitor your account and 'notice' that you have exceeded a certain limit and then debit £30 from your account !!!!!!

 

The is NO manual interventon, nor do they even incurr the cost of a stamp as they don't write a nice 'you've just been fleeced' letter

 

They can wish all they want about it being 'lawful' but that's the very reason why not one single high street bank has actually appeared in court - they are petrified that they would loose, atract unwanted publicity and then 1,000 of people jump on the 'pay us bank' band waggon !!!

 

Remember in 2005 the banks reaped a massive £3 BILLION in charges . . would you 'risk' loosing that nice little earner, NO you would just pay back to those that found out how and issued a claim agaisnt them, and traet it as 'irritating' !!!!

 

Steve

[GaryH]

They can call it what they like, 'fee', 'service' whatever - its still a penalty. Its punitive by its very nature, no matter what they might care to call it. Its called 'cloaking' and its not likely to impress the courts much. Heres what the OFT had to say about it in their April report -

 

4.21 Disguised Penalties

 

The analysis in this statement is in terms of explicit, transparent default fees. Attempts to restructure accounts in order to present events of default spuriously as additional services for which a charge may be made should be viewed as disguised penalties and equally open to challenge where grounds of unfairness exist. (For example, a charge for ‘agreeing’ or ‘allowing’ a customer to exceed a credit limit is no different from a customers default in exceeding a credit limit.) The UTCCR’s are concerned with the intentions and effects of terms, not just their mechanism.

[Claire wilson]

I really hope your right, I am starting to panic received my AQ on 19th Dec, got till 7 January to submit, but worrying that I havent got the £100 to pay for it, bet you I'm the one they do the test case on!!!

[gemspan]

Hi Claire

 

If they do then that would be good (not for you of course!!!!) because they would lose and it would mean they would stop playing silly beggars with people.

 

The people that these unlawful charges have hit the most is the likes of you and me. By that I mean we dont have a lot of money and if, like me, you live on a tight budget then something like those horrendous charges can make your life a misery.

 

I really hope you can find the £100 to go for this as it would be a shame for you not to. I think the banks realise the costs involved and hope that people will pull out.

 

I hope 2007 is a good year for you. Dont worry; you will get the money you are entitled to.

 

Kind regards

Annie

[Claire wilson]

Thanks Annie, theres is just no telling I have just been reading boxers thread and he got his offer 2 days before he was due to send his AQ off, I will go for it though it is just hard to believe that you are ever going to get it back, mine is just on 5k, alot of money for the likes of me and with a new baby on the way I really need it!! All the best for 2007 I will keep you informed.

[GaryH]

http://www.consumeractiongroup.co.uk/forum/hsbc-fd-hfc-successes/

[nettyg]

Thanks Annie, theres is just no telling I have just been reading boxers thread and he got his offer 2 days before he was due to send his AQ off, I will go for it though it is just hard to believe that you are ever going to get it back, mine is just on 5k, alot of money for the likes of me and with a new baby on the way I really need it!! All the best for 2007 I will keep you informed.

 

Hi Claire

 

I'm following all cases very carefully and i'm so glad i'm not the only nervous wreck on the internet lol......

 

I'm just so envious that you are at the AQ stage and like you, i will struggle to find the funds when i get there BUT get there we all will.

 

Congratulations on the baby by the way... even more reason to hang in there eh?!!

 

Netty x

[lateralus]

claire - wrote to you on the without prejudice thread.

[gemspan]

HI there

 

Can anyone tell me the difference between a managed loan and a normal loan? When I hit financial probs HSBC put me on a managed loan with payments of £321 per month which are crippling me.

 

Any answers would be appreciated.

 

Thanks

Gemspan

[Guest NATTIE]

A managed loan I think is one specifically on charges and likelihood is that it is about 3% higher than a normal loan. I hope someone with a bit more knowledge of HSBC can either confirm or correct me.

[acer]

Good evening Gemspan

From my own experiences the managed loan is one that is generally imposed by the bank as a means to 'help' people sort out problems such as overdrawn accounts etc. It normally has a higher interest rate than an ordinary bank loan and has other strings attached such as no overdraft facility or access to other forms of credit. You may find, as I did, that even after the loan has been paid in full, with a perfect payment record that further credit is refused.

 

Over the past ten years or so I have had three managed loans imposed upon me and am at present resisting overtures from hsbc to take another one...I might add that all these loans were a direct result of bank charges and if I knew then what I know now, as a result of this site, I woul

d'nt have signed the paperwork.

Not only do they screw you with the charges...they then sell you the money to pay

them back...unbelievable is'nt it......But now the worm is turning.

[nettyg]

i always saw managed loans as 'last resort loans' where the bank make you feel like you're not going to get help anywhere else so pay up even though the interest rate is higher than anything else!!

 

they're usually the ones that get everybody into serious trouble if you don't pay an installment - they seem to spiral out of control very quickly!!

[gemspan]

The amount that I'm paying is so much more than my original loan £321 as opposed to £250 (and that included ppi!). Is it worthwhile complaining to HSBC about this because I dont think they have taken my best interests into account. If they really want to help, why do they charge you over the top interest? It just doesnt make sense.

 

Annie

[nettyg]

but now we know that the banks don't operate in 'your best interests' but seem to zoom in on your vulnerability...... just go for the claim - get it back

[cybergypsy]

The interest rate when they offered me one a week or so ago was 10.95%.

[lou7603]

Hi All,

 

I posted this on another HSBC thread about managed loans. Anyone had any better luck than me??

 

was forced to take out my loan to refinance a personal loan from HSBC that was from my husbands Uni overdraft and student loans etc plus a credit card of my own about 3 years ago- I was paying 7.3% on that loan and am now paying (supposedly) 12%. These loans are a nightmare as they will not allow you under any circumstance to pay a lower amount- for example I was off work for 4 weeks with laryngitis and wasn't paid for it- called HSBC to see if I could pay a lower amount for that month as I was the best part of £1200 down on my wages. They refused point blank- took their £216.00 and then returned other direct debits due to insufficient funds!!!!!!!!!!!!!!!!! The bank wins every time. I'm glad that people are fighting back. I can't even work out the percentage of interest that I am paying as I don't hve a clue how they calculate it. All I know is that in 18 months or so I have supposedly only paid off £500 when in reality I have paid approximately £3888???????????????????? ???????? They are no better than loan sharks that come to your door. I wouldn't mind but I'm not exactly high risk- we own our own home, both work full time and bring in good money- yet we are treated like untrustworthy idiots. I am absolutely going to fight them over this as I am sick of going out to work to pay people like them!! RRRAAAHHHHHHH!

 

 

Well, couldn't go to the branch this morning as the kids are still off school ( didn't think it would be wise for my 3 and 5 year olds to see mummy going purple in the face and screaming at the nice bank man!) so I called the credit department. I have had a splitting headache ever since. The extremely (!) nice man on the end of the phone told me that I had signed for the loan therefore I signed the terms and conditions. I told him that I had signed up for 12.25% interest and expected to pay 12.25% not the almost 60% that I am currently paying per month. He assured ( ) me that I am not paying 60% and that the more of the loan that I pay off the lower the interest payment will be. However, if I pay the loan off early there will be no rebate of the interest that I have paid:evil: . So HSBC are expecting me to continue paying £216 for the next 8.5 yearson this loan. This means that I will actually be paying them £25920.00 for a £15k loan. Hmmm, let me just ponder on that one for a minute..........

Nope I don't think so........

I asked how HSBC thought they were any better that loan sharks to which I got the same answer " you signed the paperwork"

I may have signed the paperwork, but it was under duress as HSBC told me it was that or bankruptcy. They even gave me the business card of an insolvancy practitioner!!! When I took this loan out to get rid of the joint one I was made to put it in my name only. I was also unemployed.I lost my business in the October ( hsbc knew this as I had a business account with them) took this loan in the Jan and didn't start work until the March. They never allow you to lower the payment if you get into difficulty and then charge you if there is not then enough money to cover your other bills in your account. I have now transfered the money from my remortgage from my HSBC account and I will not be clearing this managed loan as yet, as I have put a complaint in with the ombudsman about the way HSBC put these loans across. They have told me that its a bit like a mortgage- uh, no- it's a personal loan that is linked to your bank account that allows the bank carte blanche over you and also allows them to treat you like a 14 year old only allowing you to have a solo (rraahhhh) card and then to speak to you as if you are an idiot. NO MORE. I will go to court over this if I have to...............

[rdm2006]

Hi All

 

This thread may help you

 

http://www.consumeractiongroup.co.uk/forum/hsbc-bank/15457-who-has-had-managed.html?highlight=Managed+Loans

[gemspan]

HI there

 

The short story is this. I had a business account with HSBC and a Business Loan. I took a calculated risk with my business to attend an even and it went pearshaped and thus experienced some financial difficulty and cash flow problems. I went to my local branch and explained the problem and they decided that the best way for me would be to consolidate my business loan (with PPI!) and my overdraft. They came up with a figure of £20,800 although I had originally borrowed £15,000 for the loan and had paid it for some 2 years - and my overdraft was £5,500.

 

Now, I trusted the bank (at that time!!!! ) and thought they were acting in my best interests. However, the monthly payment for my business loan was £251 with PPI in case of illness and the monthly payment for the managed loan was £321 and obviously the insurance wasnt available.

 

Because of my financial difficulties I had to give up my business and have been left with this managed loan which I have been unable to pay. I calculate that there are charges included in the loan, possibly the PPI and, today when I got out the paperwork to check everything was OK, I noticed that the interest rates differ as follows:-

 

"Interest rate 10.95% over base (:o ) which at the date of the agreement gives a variable per annum rate of 15.700%."

 

However

 

Key Financial Information states

 

Amount of Loan: £20,800

Period of Loan in months: 144 :o

Annual Percentage Rate: 16.900%

 

This is wrong.

 

Bearing in mind that I think I have been shafted big time, do I have a case and is this agreement enforceable?

 

Any help would be gratefully received as I am getting bombarded with phone calls and I would like to send a letter putting them straight.

 

Kind regards

Gemspan

[gemspan]

Just wanted to add that I checked another loan agreement that they wanted me to sign (which I didnt!) and the two interest rates are the same.

 

G XXXX

[gemspan]

Please can you have a look at my thread here. I posted on HSBC website but realise I should probably have posted here. It is self explanatory.

 

Thanks guys!!

 

Gemspan

 

http://www.consumeractiongroup.co.uk/forum/hsbc-bank/110911-managed-loan-differing-interest.html

[gemspan]

Bump. Please can someone have a look at this for me and give me advice on how to proceed.

 

Thanks

Gemspan