Welcome Finance - balance owing £5k more than actual loan

[MrsSkint]

Hi guys

I wonder could anyone advise us on what to do about Welcome Finance.

In July 2006 a friend of my daughter's took out a loan with Welcome Finance for a car. The loan was broken down as follows:

Amount of credit for goods £3,724.00
Amount of credit for insurances £1,299.96 (PPI)
Total amount of credit (5,023.96)
Duration 36 months

He paid his monthly direct debits up until approx last Christmas when he was made redundant and then stopped paying them. (I don't think he realised that his PPI would have meant that his monthly repayments would be covered). They've been sending him letters to his old address (he has since moved).

They are now saying his account balance is £9,169.30! Is that right?! Any advice as always extremely appreciated. Many thanks!

G xxxxxxxxx

[Amethyst]

Re: Welcome Finance - balance owing £5k more than actual loan

Do you have the APR, the actual interest rate, and is the total charge for credit shown on the agreement ? If he has the agreement it would be useful to see it.
Also was the loan specifically for purchase of the car (restricted use) or a general loan ?

Did he just stop paying without any contact or has been been making any reduced payments to Welcome ? Sounds like he just stuck head in sand when he lost job and moved house ?

With interest accruing and charges yes its quite feasible its shot up to that kind of sum in the last 11 months. Whether its right or fair is another matter.

[MrsSkint]

Re: Welcome Finance - balance owing £5k more than actual loan

Hello again!

Yes, I have all his papers here but will have to scan tomorrow at work and post them up.

I don't think he's given me the whole story - I know he was using a dmc to pay his creditors but not sure if they are one of them - will ask when I see him again.

I think you're probably right about hiding head in sand etc. but will try and help him out as much as I can (with your help obviously). I suppose if his charges have accummulated and he does owe this amount and possibly growing with each week should he try and get whatever he has paid off his PPI to reduce the debt? They don't know where he is at the minute but will probably track him down soon and in any case I think he just wants to get it sorted. Just a pity he owes so much for a small(ish) loan.

Anyway, will post up agreement tomorrow.

Thanks again Ame - have a good evening! I'm helping kids cut up pumpkins (floors a mess!!)

G x

[scoobydoo]

Re: Welcome Finance - balance owing £5k more than actual loan

Do you know why he thought the PPI would not cover him?

[MrsSkint]

Re: Welcome Finance - balance owing £5k more than actual loan

Hi Scoobydoo

No but I've got a feeling that he didn't know that the insurance covered him in the first place. The insurance was lumped on top of the loan and my guess is that they didn't explain to him about PPI and that it was optional. Will find out and post here.

Thanks x

[Amethyst]

Re: Welcome Finance - balance owing £5k more than actual loan

lol we did ours on Monday, still finding pips all over the shop !

And they'll probably be mankified by halloween.

Yes seeing his doc's would be good and if you can get hold of his statement from the DMC that'd be good and we can intefere

[MrsSkint]

Re: Welcome Finance - balance owing £5k more than actual loan

Mornin' Ame

At work now so will scan agreement at lunchtime.

Thanks again

G xxxxxx

[MrsSkint]

Re: Welcome Finance - balance owing £5k more than actual loan

Hi again Ame - boss in meeting so quickly scanned agreement and attached.

Also spoke to M (daughter's friend) and asked if he paid some of this off via DMC - answer is no. Long story short again. Before M was actually made redundant last Christmas, he had other debt problems, so spoke to Welcome and they gave him a reduced payment per month of £100, which he paid every month apparently until he was made redundant, then stuck head in sand (bless him, I've done that in the past too!) and stopped paying. Moved house and hoped it would all go away!

It's been on his mind ever since though and he doesn't know what to do about it, and I'm no expert, but if they wanted over £9k from him 6 months ago I shudder to think what it is now!

Anyway, have a read - I also have quite a few letters from Welcome sent to M at his old address - he has kept everything so if you need to have a look at these just shout.

Thanks Ame

G xxxxx

[Amethyst]

Re: Welcome Finance - balance owing £5k more than actual loan

Ouch @ 40%, the agreement looks fine to me.

He'll be looking at around £11k now if that 9k figure was 6 months ago. Possibly more.

Okay this PPI.

When he informed Welcome of his financial problems and redundancy they should have informed him that he could claim on his PPI policy. Although possibly a problem because he was already on reduced payments at the time of his redundancy. Will have a look into that bit. Think we need to work out if a backdated claim on the ppi insurance is worth more to him than a reclaim of the ppi premiums and interest.

[MrsSkint]

Re: Welcome Finance - balance owing £5k more than actual loan

Jaysus wept!! He definitely won't be fit to handle that sum! £11k!!! Do you think maybe he should get in touch with Welcome? Loath to tell him to do so, but if he can't pay £11k and rising! maybe he could get CCCS or someone to negotiate on his behalf and pay off what little he can. Anyway, won't do anything until I hear back from you Ame.
G x

[Amethyst]

Re: Welcome Finance - balance owing £5k more than actual loan

I'll ask Curly or someone to take a look at the agreement just to check it is okay and rule that route out.

He hasnt had any contact from them, nor contacted them since Christmas, and they dont have his new address. So no huge rush, tho they will catch up with him so yes its a good idea to get his head out the sand now, but dont contact Welcome until you know exactly what his options are.

Yes it is a good idea to get it added to the CCCS plan (along with everything else if hes using some fee charging DMC at the moment) but hang fire for a while. Do you/ he have his ppi documents / policy - maybe have a look through there about late claims on redundancy etc ? (dont do anything with it tho just seeing what the option is)

First contact whatever he does will be a full subject access request and cca request, but best to do that alongside a cccs plan incase they just jump for court.

Does he own his own property ?

[MrsSkint]

Re: Welcome Finance - balance owing £5k more than actual loan

ok Ame will hang fire until I hear back from you.

Nope, he doesn't own his own property but he's living with my daughter, and she is the one who is renting the property.

[calamity jane]

Re: Welcome Finance - balance owing £5k more than actual loan

Hi MrsSkint,

Are you able to put the Agreement back up with the personal details removed yet?

One other thing I did notice is that although he was charged for Payment Protection & Shortfall Insurance, only the box for Shortfall was ticked on the second page.



CJ

[MrsSkint]

Re: Welcome Finance - balance owing £5k more than actual loan

Here you go CJ. Agreement attached again. You're right - the second page only has the shortfall insurance box ticked, but on the first page it has the amount of PPI as £1,054.96

[MrsSkint]

Re: Welcome Finance - balance owing £5k more than actual loan

Hi guys

Does anyone have any ideas about this one? Should he still keep schtum do you think?

They still haven't caught up with him but he is worried understandably.

Thanks for your help

G x