advice for a friend re welcome finance

[scaredkez]

just wondered if any extra advice is out there for a friend of mine, she has told me, she has a debt problem about £8k all together, single parent with 2 kids on income support, she took a loan out 12 months ago with welcome finance for £2k when she was working, she spoke to them in august explained she was having difficulties missed the payment so they sent someone to the house she stupidly let them in, she explained she was no longer working and was now on income support, the lady very kindly said she would help her and reduce the payments, she never read what she signed!!!! she has shown me the paper work today which was set up in september and basically from reading it they have wiped the original £2k plus the ppi with a new loan for £3674 spread over 120 months (10 yrs) plus charged her 75 for the counsilling session!!!! added to the balance and will pay off a grand total of £7k as long as the interest rate doesn't increase, she said the lady never explained that she would be taking out a new loan she just thought she was reducing the montly figure until she could get back on her feet so the original £2k loan will have taken 11yrs to pay off, the woman also knew she receives income support and was already struggling, i didn't know what to advise on the welcome finance front, she has missed the payment now and is frightened they will turn back up at the door, i have asked her to do an i+e for me and suggested a dmp but i was wondering if she could do anything about the welcome finance one as it says in the signature bit i declare i am working full time, but the lady just got her to sign the forms knowing full well she had no earnings.

any advice would be great.
kerri

Please view my blog at: http://scaredkez.blogs.iva.co.uk/

[MelanieGiles]

Sounds like a case of mis-selling to me, but apparently the FSA do not cover unsecured lending. She could try making a complaint to the Financial Ombudsman?

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

To have me propose an IVA for you, please visit:
http://www.melaniegiles.com/ivaEnquiry.asp

See customer feedback at:
http://www.iva.com/iva_companies/IVA_Advice_Bureau.asp

[mikebdomain]

This loan type is regulated under a normal Consumer Credit Licence.

She needs to speak to a solicitor and discuss the timings of the ‘counselling’ (or rather hard sell) session and her signing the documents. She should have been given a seven or eight day cooling off period (can’t remember off the top of my head whether it is seven or eight days) before signing the loan agreement.

If the cooling off period was not given this is certainly mis-selling and this should be reported to the Office of Fair Trading.

Get your friend to talk to OFT Consumer Direct on 08454 04 05 06

FREE ADVICE IS THE BEST ADVICE

LEYBRIDGE LIMITED
Whole of Market Mortgage Broker & Mortgage packager
Specialising in adverse credit.

Directly Authorised Firm FSA No:313790

CeMAP 1,2 & 3 qualified
F.P.C 1,2 & 3 qualified
Financial Planning Certificate
Certificate in Regulated Customer Care
Certificate in Regulated General Insurance
Associate of the Charted Insurance Institute

see feedback and testimonials at:
http://www.leybridge.com/testimonial.php
Check out my blog at:
http://mikebdomain.blogs.iva.co.uk/
Please read our Initial Disclosure Document(IDD):
http://www.leybridge.com/Leybridge-IDD.pdf

[scaredkez]

thanks to both of you have just spoken to her and give her the phone numbers to ring, she said when the lady came out she got her to sign the document which we now know to be the new loan, also an i+e form, had to produce evidence that she was on income support and that was it, nothing else received from them it does have a cooling off period on the document but as she thought they had come to discuss payment arrangement she didn't notice or read the document she was just releived she was getting help and in no way would have take n out another loan to clear the original when she was already struggling. the lady never even gave her the impression that another loan was being offered on the original she was also sold ppi but not on this one, but has obviously paid that off with the new funds they have raised through the new loan.

she is panicking that she can't prove she didn't know that she was taking out another loan, and wished she had read what she was signing. another thing she just told me they asked for 2 names of family and friends along with their address and phone numbers which she gave them, i can't believe she did that.

kerri

Please view my blog at: http://scaredkez.blogs.iva.co.uk/

[wen]

Just a word about Welcome Finance.

I rang them a few months ago to change my direct debit details. Unlike every other company who did it over the phone I had to fill out a new mandate. 2 days after the mandate had arrived, I received a letter saying *I* had cancelled my DD and now they were charging me £20 to send me a letter.

I rang HSBC and they told me that Welcome Finance cancelled it themselves!! When I rang to complain, they said it was my problem and the £20 charge stood!

[scaredkez]

they also charge you £10 for every phone call they make to you, and £25 if they visit you at home, i have told her to request a statement of all payments and charges so she can see what they have also added on.
kerri

Please view my blog at: http://scaredkez.blogs.iva.co.uk/

[Storm]

Probably worth getting a legal view - Welcome do have an agreement which can be cancelled without penalty within 7 days providing the debtor repays any monies advanced in the same period.

Obviously in this case no monies were paid but legally one agreement was settled and another started so to cancel the current agreement your friend would be required to repay the original loan in full to cancel the agreement. By the sounds of it the contract was not cancelled within the 7 days.

I would also confirm all the paperwork very carefully they did used to have a document that the consumer could sign to waive all consideration periods.

[wen]

they also charge you £10 for every phone call they make to you

One reason why I don't answer the phone if I don't know the number!!