Hi,thanks for replying,when i say is it legal i dont mean should i pay,of course i should,i mean can they freeze my bank account

thanks again 

Of course it is legal - if the error was the other way, and they had paid you £5k and you chose to keep it, then that would be theft pure and simple.

However it isnt fair - be honest with them that you cant afford it at the moment, and that you also believe that the £3k is more than you should pay as it was their admin error that meant it took so long to chase.

You have to bear some of the responsibility for not paying it back though (unintentional though it may be) 

I am sure they will be agreeable to organising terms that are mutually agreeable. 

speak to your bank first it could be an admin error.ask them why has it taken 2 years for them to chase this?  when you recieved settlement letter and accepted amount how did you pay? also check your credit file as that will tell you if the account was settled hope this helps a bit.

Hello all,

This morning we recived a letter from our bank which claims we owe £8500 off a loan we thought had been settled 2 years ago.The week we moved house we contacted the bank for a settlement figure,it was £5200,we acepted this and then recived a letter to say the loan was settled,as our house was a renovation project we just got on with every thing else we had to do.We have had no contact since untill this morning,if we owe the money we will pay it,our questions are.Why has it taken so long to contact us,will my credit rating been affected through there error,and can they claim an extra £3000.The letter states that if we have not paid in 14 days charges will be incured,but we dont have £8500 spare.any advice would be welcome.Thank you. 

p.s The bank have our new address as our morgage are throug them,and they have never contacted us reguarding this matter,they have however constantly sent us letters for credit cards,loans,insurance ect ect