Early Repayment charges on secured loan with GE Money HELP!!!!!! Please

[bigdave368]

Hi,

Well this is the situation i was going through a loan statement i have with GE Money which was a secured loan of £29500 which i paid off a little over 3 years later. I'd never noticed it before or when paying the loan off but there is 2 payments in the final month for fees 1 for £5004 and the other an income on early settlement of £2285. Not really sure what to do about it if anything.

Any help with this would be great

Thanks in advance

Dave

[Bill-K]

Re: Early Repayment charges on secured loan with GE Money HELP!!!!!! Please

Hi Dave, and welcome to you. Early Redemption Charges (ERC's) is not my forté, but these became difficult to reclaim a few years ago. You could still send GE a claim for this - Nothing ventured, nothing gained, as they say - but I would not recommend taking the claim into court. The second amount, "Income on early settlement," looks like a credit to the account of £2285 - in which case it may have been a PPI refund. If you had PPI (Payment Protection Insurance) on this loan, then the PPI may be reclaimable. If the £2285 was another debit, then it might be worth reclaiming it. In any event, I think it would be worthwhile asking them to explain what it is.

[bigdave368]

Re: Early Repayment charges on secured loan with GE Money HELP!!!!!! Please

Hi Bill,

Thanks for the advice will give GE Money a ring and ask them to explain the £2285 is defo a debit charged fromto the account rather than to it but not sure.

thanks again

Dave

[bigdave368]

Re: Early Repayment charges on secured loan with GE Money HELP!!!!!! Please

Would you have any advice on reclaiming charges on this account not sure if ou can still do that asi missed a few payments and ended up in arrears and was getting charged all sorts of different charges. I had The Mortgage/Secured loan for over 3 years and ended up paying over £36000 to settle.

[Ruby]

Re: Early Repayment charges on secured loan with GE Money HELP!!!!!! Please

ERC's and early settlement charges are quite different, to my understanding. Early settlement charges are when you settled the loan before the end of term, especially in the early years (usually in the first 5 years) then you get charged this fee. ERC's is usually a fairly nominal fee that is quite easy to claim back as I believe a few years ago the OFT deemed a lot of sub-prime lenders were charging too much. We are only talking in the low hundreds of pounds, if that.

[Bill-K]

Re: Early Repayment charges on secured loan with GE Money HELP!!!!!! Please

Interesting to read Ruby's thoughts on this. Perhaps it would be good to get a really clear explanation of BOTH of these charges - and in writing. Phone calls can be denied later, and we may find we will need proof - not hearsay.

Ruby - can you dig anything up regarding the OFT's pronouncements about ERC's, meanwhile ?

[gravytrain]

Re: Early Repayment charges on secured loan with GE Money HELP!!!!!! Please

Hi,

Well this is the situation i was going through a loan statement i have with GE Money which was a secured loan of £29500 which i paid off a little over 3 years later. I'd never noticed it before or when paying the loan off but there is 2 payments in the final month for fees 1 for £5004 and the other an income on early settlement of £2285. Not really sure what to do about it if anything.

Any help with this would be great

Thanks in advance

Dave

Is this a CCA regulated loan(after 2008), or is it a first charge ?

[Ruby]

Re: Early Repayment charges on secured loan with GE Money HELP!!!!!! Please

Bill, this is going back circa four years ago. I am not sure I have any paperwork left on the subject. It is worth exploring though.

[PlanB]

Re: Early Repayment charges on secured loan with GE Money HELP!!!!!! Please

Ruby - can you dig anything up regarding the OFT's pronouncements about ERC's, meanwhile ?

An ERC cannot be challenged outright since it's a term in the mortgage contract, but the FOS has considered (and upheld) cases where the lender (or broker) failed to explain the negative consequences of settling early to the borrower at the outset. GE Money's products were normally sold through a broker or intermediary because they didn't deal direct with the public in which case your complaint may have to be against the person who (mis)sold you the loan in the first place and not GE Money.

This is what the FOS says on the subject:

http://www.financial-ombudsman.org.u...t-charges.html

[Ruby]

Re: Early Repayment charges on secured loan with GE Money HELP!!!!!! Please

The FOS site refers to mortgages, would anyone know whether this also extends to second charges and unregulated agreements?

[gravytrain]

Re: Early Repayment charges on secured loan with GE Money HELP!!!!!! Please

If this was a second charge executed after 2008 the CCa early settlement regs would apply.

[bigdave368]

Re: Early Repayment charges on secured loan with GE Money HELP!!!!!! Please

This loan was taken out 27th jan 2005 if this helps anyone.

[Ruby]

Re: Early Repayment charges on secured loan with GE Money HELP!!!!!! Please

Bigdave, by the sounds of things your loan was unregulated, as it was 29.5K. I think these sub-prime lenders kept exploiting every loop hole at the time to make sure they made as much money out of us without any recourse. Its only after the credit crunch in 2008 that regulations really tightened and effectively pushed these companies out of business.

[bigdave368]

Re: Early Repayment charges on secured loan with GE Money HELP!!!!!! Please

I have a copy of the original credit agreement stating it is regulated by the consumer credit act 1974 and I'm legally bound by its terms if that helps.

[Ruby]

Re: Early Repayment charges on secured loan with GE Money HELP!!!!!! Please

Since it was regulated you should be able to challenge the charge. Firstly through GE and if you don't have any luck with them you can go to the FOS.

I would however read through your terms and conditions first. If in your T & C's it says they have the right to charge you this ERC, then I'm afraid you probably are on the road to nowhere.

Please note I only speak from personal experience.