Unregulated loan and Legal & Documentation Fee

[jumper999]

I have been looking at the Legal and Documentation fee noted on my Blemain agreement which shows £0.

Term 1 of the agreement reads that no interest will be charged on the legal and documentation fee as it will be due on redemption of the agreement.

I have attached a letter I received from Ocean confirming that the Legal and Documentation Fee is £921...but Blemain state it is £0 and have in fact added the £921 to the loan plus I am paying interest on this.

My question is why have Blemain not written £921 as the legal and documentation fee?

I believe this is clearly a misleading and hidden term....and contradicts what Ocean Finance say.

any input would be great.

[Sparkie1723]

Re: Unregulated loan and Legal & Documentation Fee

I have been looking at the Legal and Documentation fee noted on my Blemain agreement which shows £0.

Term 1 of the agreement reads that no interest will be charged on the legal and documentation fee as it will be due on redemption of the agreement.

I have attached a letter I received from Ocean confirming that the Legal and Documentation Fee is £921...but Blemain state it is £0 and have in fact added the £921 to the loan plus I am paying interest on this.

My question is why have Blemain not written £921 as the legal and documentation fee?

I believe this is clearly a misleading and hidden term....and contradicts what Ocean Finance say.

any input would be great.

Hi jumper it is more than a bit misleading........but what Ocean have done is added the acceptance fee the solicitors costs and the title indemnity fee together and called them all the Legal & Documentary fees ( which is what they are)............Blemain have not listed them as documentary fees and that's how they have got round the interest charging issue.......you have a strong argument that the 3 items are legal and documentary fees and you should not be charged interest on the sums.
They are charging interest on items they should not be charging it on......very misleadin and very deceptive.
Making you pay more than you should be.

My interpretation and as you know I'm not a lawyer its just my unqualifed opinion.

Sparkie

[jumper999]

Re: Unregulated loan and Legal & Documentation Fee

Thanks sparkie and hope you would agree and yes it is very misleading.

I was thinking of what arguments they could come back if this was addressed to them? would they say it was a mistake? No I don't believe it is a mistake and deliberate what they did and probably have done to thousands of other borrower with unreg agreements.

If my agreement was a regulated one....then this would have had a very big impact on matters...as it is unreg.....Blemain may think it is alright to right what ever term they want in their agreement.

I am going to look in to this further.

[jumper999]

Re: Unregulated loan and Legal & Documentation Fee

This is the advice John Pugh gave me a few years back on this matter:

There is more in this respect buried in Blemain’s agreement. In clause L of the terms Blemain say that the Lender will deduct the costs charges and expenses referred to in 2 (b( (i) overleaf (which refers to the fees mentioned above) from any drawdown of the “Loan Facility”. Note they do not say from the “Total Loan Facility”. So using their own terminology they have added these sums to the loan amount instead of deducting them from the loan amount, thereby making themselves more interest. However, in clause 11 they retain authority to deduct the broker’s fee from the “Total Loan” (not the “Total Loan facility” or the “Loan Facility”). In paragraph 18 they get it right and say that “The Lender will deduct the solicitors costs shown in E above from the “Total Loan Facility

The whole agreement is very confused in this respect and the upshot is that Blemain make an extra £4,429.87 in interest over and above what was intended, once credit is given for the extra drawdown

1. I am asked to advise whether in these circumstances the Court would adjust the loan agreement to make allowance for this sum under Section 140B. I am sorry to say the best I can advise is that they might. There just isn’t enough case law to know how far Courts will go in unfair relationship cases to be sure. It is most certainly arguable. The Case against Ocean is stronger, because they owe a duty of care to advise Mr & Mrs Khan and they have plainly abrogated it. However the unfair relationship argument against Blemain would be more useful to her in that it is Blemain who are likely to start proceedings against her for default soon.

And indeed Blemain have issued proceedings against me....in May 2011...which are still ongoing...

[Sparkie1723]

Re: Unregulated loan and Legal & Documentation Fee

Thanks sparkie and hope you would agree and yes it is very misleading.

I was thinking of what arguments they could come back if this was addressed to them? would they say it was a mistake? No I don't believe it is a mistake and deliberate what they did and probably have done to thousands of other borrower with unreg agreements.

If my agreement was a regulated one....then this would have had a very big impact on matters...as it is unreg.....Blemain may think it is alright to right what ever term they want in their agreement.

I am going to look in to this further.

I would ask on thread if anyone else who has a loan from Blemain if theirs states the same in the same boxes as yours does........if so Bingo ...can't be a mistake:beagle:

Sparkie

[jumper999]

Re: Unregulated loan and Legal & Documentation Fee

Good idea sparkie! I can assume that all Blemain's unregulated loans will be laid out pretty much similar to mine and I agree this cannot be a mistake.

The average person looking at this Blemain have believe that there is no legal and documentation fee added to their loan. Their agreement "terms and conditions" also confirm this....BUT....the broker who arranges the loan clearly advise and give a breakdown and the name "LEGAL AND DOCUMENTATION FEE" on the agreement.

So who is right? the Broker or Blemain? probability is that the Broker is right.....and this is just one example of an unfair and hidden term....which I say is very misleading to the average person......and Blemain know it is.....how they will justify to the court will be something I will look forward to finding out.

I know there are a few others who have unregulated loan agreements with Blemain and will invite them on this thread to see if what I say matches with them too.

Thanks for popping in sparkie...much appreciated as always.

[gallahad]

Re: Unregulated loan and Legal & Documentation Fee

Here is a copy of my agreement I hope it may help
G

[jumper999]

Re: Unregulated loan and Legal & Documentation Fee

Thanks gallahd.....posting it up!

Yes it is similar to my agreement. Does your agreement terms and conditions also say the same as mine no interest will be charged on the legal and documentation fee as it will be due on redemption of the agreement.?

And was you charged a Legal & Doc Fee? silly me....yes you was as it shows a breakdown on your agreement £995 + £529 + £175.

does term one of your agreement match the term 1 on mine?

[gallahad]

Re: Unregulated loan and Legal & Documentation Fee

Yes Jumper it says interest will not be charged as it is due on redemption
G

[jumper999]

Re: Unregulated loan and Legal & Documentation Fee

Thanks G....and are you being charged interest on the LDF?

[gallahad]

Re: Unregulated loan and Legal & Documentation Fee

It would appear not
G

[jumper999]

Re: Unregulated loan and Legal & Documentation Fee

Then maybe your documentation is different to mine.....and you may have a different layout to these fees.

[gallahad]

Re: Unregulated loan and Legal & Documentation Fee

if you want to pm me your email I will gladly mail the complete document for you to compare
G

[jumper999]

Re: Unregulated loan and Legal & Documentation Fee

Ok thanks will do...

[gallahad]

Re: Unregulated loan and Legal & Documentation Fee

On its way now Jumper
G