New credit card charges

[Pole]

Hey all

Received letters from credit card companies about new charges on my accounts. Basicly they will add percentage of my debt to monthly payment to "help" me pay it off quicker. Is that legal? Can they do that? It`s not change in interest, they just add extra money to it. Can`t afford new charges as it raises my payments on 3 cards from £300 to about £450. HELP?!

[the_shadow]

Hey all

Received letters from credit card companies about new charges on my accounts. Basicly they will add percentage of my debt to monthly payment to "help" me pay it off quicker. Is that legal? Can they do that? It`s not change in interest, they just add extra money to it. Can`t afford new charges as it raises my payments on 3 cards from £300 to about £450. HELP?!

 

Which credit card firms are these?

 

If you signed up for terms and conditions that stated your repayments were a certain percentage then they'd have to give you advance warning (30 days) I believe prior to making the change, also you could refuse the change and they close the card and the repayment percentage stays the same... this all assumes you are not in financial difficulty of course.

 

S.

[victoria_siempre]

Hi guys

 

I believe this is a requirement of the European Credit Directive that came into force in Feb 2011; it basically says that minimum payments must be sufficient to result in some repayment of Principal.

 

x

 

v

[Pole]

Thanks for reply.

It`s Virgin, MBNA, Barclaycard. And it`s not interest rate going up, just 1% of balance added to every month payment. I closed account with Virgin some time ago, that didn`t stop them from doing so. Thanks, you think i`m not in financial difficulties Shadow, i know there are people in far worse situation than me, but i`m floating just just on surface, this raise means i`m going down and then i`m in troubles.

Dear Victoria

If that comes from European Credit Directive, does that mean i can`t say no? Is that in my agreed Terms & Conditions? (Didn`t read small print in happy days and now it`s all long gone somewhere on wasteland)

Regards

[the_shadow]

Thanks for reply.

It`s Virgin, MBNA, Barclaycard. And it`s not interest rate going up, just 1% of balance added to every month payment. I closed account with Virgin some time ago, that didn`t stop them from doing so. Thanks, you think i`m not in financial difficulties Shadow, i know there are people in far worse situation than me, but i`m floating just just on surface, this raise means i`m going down and then i`m in troubles.

Dear Victoria

If that comes from European Credit Directive, does that mean i can`t say no? Is that in my agreed Terms & Conditions? (Didn`t read small print in happy days and now it`s all long gone somewhere on wasteland)

Regards

 

As I said if its a variance of the terms and conditions then yes this is what you must pay to meet the new minimum payments

 

My reference to you being in financial difficulty or not was due to the fact that if you are in difficulty and some repayment scheme already then the credit card firms dont have to freeze your repayments at the current amount like they do for customer who request it and are repaying ok, crazy eh!

 

I'm not sure how the european directive ties in with the standard practice of allowing you to close the account but keep the repayments the same when they try to increase the repayment amounts but you can bet your bottom euro that its not going to be in your favour I'm afraid.

 

S.

[victoria_siempre]

Hi Pole

 

Owing to the European Credit Directive, you can't contest an increase in required minimum repayments; it is now enshrined in UK law.

 

Site team: this is why I keep banging on about this; there is much is the Directive that is helpful to us folks, especially when aligned with CPUTR.

 

x

 

v

[Pole]

Cheers Shadow, made me much happier

So now, hopefully without wasting your knowledge and time on me, quick one: Is there a point for me to fight my corner and tell them i`ll be paying that £100 and not a penny more and ask to freeze interest (coz thats what would really help me to pay them off) or just sit, pay and cry?

I feel little stuck here. Everything goes up bills, food, petrol, mortgage (soon interest rates will raise) and now that. And my earnings gone down.

Really appreciate replies,

Wont`n mourn any more (#Always look on the bright side of life#)

Regards

[the_shadow]

Well if you go down the hardship roadpath then your credit rating will get shot but then again if you go down the s78 CCA route the same thing happens even if they dont have a physical paper agreement.

 

If it ever gets to court or if they try and get heavy with you imvho it can only be a plus the fact that you have attempted to communicate and come to an agreement with them to repay the debt.

 

If it were me then I'd do an I&E (basic, not comprehensive) ensure I leave myself enough to live on.. .including saving small amounts for xmas/birthdays/unavoidable events etc and then find the figure that I could afford. I would then put it in writing how much I could offer, ensure they know that this is under financial hardship, request that they freeze interest rates to allow you to repay this debt but you also expect to be treated fairly and in accordance with OFT's guidance and regulations, dont wait for them to agree but start paying that amount into the account and see where it goes from there.

 

Thats just the way I'd play it tho... take a look at sequenci's blogs listed in my signature....

 

S.

[astral]

Same here. I didn't receive the letter Virgin sent advising of the change so the first I knew was when I looked at my bank statement this week and my direct debit payment had gone up from £55 a month to over £130. I rang Virgin who said they had written in February and they are within their rights to do this. They said it was so the balance would be paid off quicker and I would incur less interest. My concerns are that loads of people wont be able to afford these increases and many probably went overdrawn in April.