Hi Aly One of the things I'm trying to do is get an angle on all of this and try not to get peoples hopes up too high. That said what I'm trying to do is look at where they have contravened some kind of regulation or directive or law etc

I am not dismissing the rate hikes as a case to go forward but their contracts are fairly ambiguous and it is not easy to pick up obvious and usual malpractice I did say and do agree that a ruling by the OFT to this practice is a good idea so it will not hurt for any or all of you to send a letter. What is helpful is if you have the information that Sean suggested about different people having their rate changed at different times then anyone would see this is abnormal in all its forms. Just to give you a for instance the FP contract states [various] rate calculators or prevailing conditions or some such josh. So if everything was uniform then they could come back with our undewriter/decision maker did it because of this reason, which the OFT might have to accept. But if one person had a rake hike in January and another didn't then they could not argue the point and the OFT would have to judge favourably to the consumer.

I assume you see the difference in this . I like to go in with as cast iron facts so as to be sure as you can. that they will consider your argument. For people to write to the OFT and say my rate has gone up when the lending rate has gone down and the OFT to contact Barclays and Barclays say ''our rate is affected primarily by the FHBR and other factors as per our contract'' The OFT have nowhere to go!!

The OFT will not research anything on behalf of the consumer they will only act on law, argument, regulation, malpractice, etc they can't shoot the gun unless you give them bullets.

I know this is tough psychologically and emotionally but try suing BT for seven years with a battery of lawyers and barristers which must have cost them 750,000 for my claim of £40.000 but thats another story.

What that teaches us is if you are going to take a complaint forward there has to be a justifiable complaint to wit having to be seen to have done something wrong is not the same as actually doing something wrong.

This is very tough on the consumer as your perspective is embroiled in the situation and you are affected by it which is why sometimes you have to step sideways let someone else take the brunt and re-evaluate your perspective. It is like a game of chess or more like a game of poker I;m playing on your side but looking over their shoulder at their cards.

Mike

Good morning Mike

I have put a post in the forum on Martin Lewis's website asking the members there to list their rate increases for us. Hopefully, we'll get a few replies and can compare their changes to mine & Sean's.

Thanks! Aly

I have written to FP regarding the ever increasing rates on my account, they replied giving me a fob off as my reply dictates below. For clarity, this is what has happened to my loan since inception:

I took out a £35k loan that attracted a PPi premium of some £6900, giving me a day one "advance" of £41900. My repayments were £353 day one. This was in Nov 2003. From Apr 2004 when BoE started to change base rates, my payments also started to increase to
£366 (Apr 2004)(base rate to 4% in Feb), APR 9.9%
£373 (Jun2004)(base rate to 4.25% in May), APR 10.20%
£388 ( Aug 2004)(base rate to 4.5 in June), APR 10.70%
£393 (Jan 2005)(base rate to 4.75 in Oct 04), repayment added to end of loan
£389 (Oct 2005)(base rate down to 4.5 in Aug 05) APR DOWN 10.50%

£414 (Jan 2007)(base rate to 5 in Nov 06) APR 11%
£433 (Mar 2007)(base rate to 5.25 in Jan 06) APR 11.30%
£446 (May 2007)(base rate to 5.5% in May) APR 11.80%
£455 (Aug 2007) (base rate to 5.75% in July) APR 12.10%

NO rate changes since.

PPI is something else I am going to war over btw.

I have future issues about this loan but know (as well as they do) that the equity and settlement terms mean that I along with most others, am stuck with what i have.

The fairness and the lack of clarity in the term gives me concern and will form the basis of my complaint but I do feel many voices need to be heard.

"
Thank you for your reply to my recent issue. As you state, the response from FirstPlus may not “be the answer I wanted”, however it is almost to the word exactly what I expected and it is this avoidance of the issue that concerns me.

As you state you have sold me a variable rate agreement and in the mortgage world this carries with it a certain meaning and understanding that First Plus know all to well. When you make your confirmations over the phone you do no more than mention that this agreement is variable rate and explain nothing more than that, which I feel mis-sells the agreement and its mechanism. My dialogue with yourself and others has clearly indicated a lack of understanding as I have had FHBR and LIBOR attempted to be thrown at me and a point blank refusal of any link with Bank of England base which has been the clear justification, as witnessed in letters, every time repayments have gone up.

This underlines the misuse of the term variable as the mindset of the public and myself would be that upward movement in Bank base would mean loan repayments increased. When rates move the other way, suddenly Bank base is nowhere to be seen as a measure used. My understanding, along with many I am in contact with, is that you carry a completely different perception of the term “variable”, are 100% understanding of how your rates will change, you know it is different to that of the population, yet do nothing to explain the nature in which your “variable rate” loan affects people. It is this lack of explanation that I feel breaches moral and ethical levels as this should be emphasised verbally at point of sale to make sure people understand. It was not explained to me and I would welcome copy transcripts of my sale process to clarify this. I would add at this stage that your introducing brokers have managed to corrupt their tape of dialogue with me, as confirmed when I challenged them about the mis-selling of my PPI. Be under no illusion that to simply say “you were aware of the terms and conditions when you signed the agreement” will in anyway be an acceptable excuse for, what in practise is proving, a blatantly unfair term.

Whilst you will not disclose the information, my guess is that people are enticed under an attractive APR, then over time are gradually moved into the 12 -14% APR banding and then are left there throughout the course of the agreement. I have yet to speak with anyone in a position where their APR is lower, or even close to where they started, irrespective of when their loan started. Interest rate cycles fluctuate, your business model will accept that, knowing that you have a chance to increase your return over time and hold your position when the cycles move down again, using the funder favouring term in the agreement. LIBOR and Bank base have dropped significantly this last week and what has been the response from First Plus…..I still await confirmation of the significant reduction in rate and payment that would be occurring under a fair agreement. As a Barclays Bank business, it continues to maintain its AA credit rating and you will no doubt benefit accordingly from that, when underlying cost structures are calculated.

The implication is that First Plus do not / did not do enough to explain how a customer will be affected over time through taking a variable rate agreement, as such the type of loan you offer, working in a completely unique manner, you should be obligated to do more to take customers through this not just hiding behind a vague and self supporting term, which is essentially what the reply from First Plus proved.

The clear fact is that First Plus are hiding behind this vague term stating that it can do exactly as it likes, not justify what it has done, not be prepared to evidence why it has behaved as it has done, nor prove the underlying rationale to what it has done and not accept that it offers something under the banner of an industry understood term – “variable”. This is based, as you state, on the fact that it can make any decision based on what it feels (“can reasonably expect to occur”) and increase its profit margin per deal throughout the course of an agreement (“ensure our business is carried on competitively”) thus rendering your term unfair.

As has been stated, First Plus has no further interest in dealing with this matter so copies of this letter and recent correspondence / investigation will be forwarded to FOS.

In the meantime, I welcome any feedback and offer of resolution from First Plus. I will gladly receive notification of significantly reduced interest rates in line with recent market changes, that you are applying across the board if my complaint is to be proven to lack substance and truth. "

I am happy to enter into any dialogue needed to prove a lack of "fairness" to their agreement.

Hi Reddhlegend,

thanks for the info. Let us know as soon as you get a reply to your letter.

I have had a letter from FP today in response to my letter querying why interest rates haven't dropped - the response I was expecting really:

"As outlined in your terms & conditions, the extent of any changes in your interest rate may be determined by the Finance House Base Rate (FHBR). However any changes to the Bank of England interest rates or the FHBR could affect the rate we charge our customers.

At the present time we are not able to pass on the recent rate reduction by the Bank of England. Any future changes will be advised in line with the terms and conditions of your loan"

They went on to say sorry this is not the answer I wanted and to go the Ombudsman of i'm not happy.

As yet, haven't heard from them about my PPI claim

Have a good evening everyone

Aly.

What is very interesting is that you get a specific reference to FHBR in your email. When I first talked this through with FP they tried to say there was no link to BofE base rate, so I said why is that the case then when your letters state that due to recent increases in BofE rate the APR has increased.

They then said that FHBR also has an impact, I said that has never been referred to in any correspondence simply BofE rate as your only justification for an increase, so why bring a different rate into the equation when it suits you that Bof E increases and FHBR only really moves, essentially in line but not as dramatically. I said you must have a formula that applies, why is my rate not coming down....they then moved onto LIBOR and tried to bamboozle me with how that works. I said that I work in business finance, I understand LIBOR and spend most of my working day working with it. I work on multimmillion pound facilities where terms and rate movements are clear and defined, which is why I feel the term "variable" as applied in this case, differs massively from the agreed perception and they know it at point of sale yet fail to explain and describe it in any detail, simply asking you to confirm the rate is variable. If your loans were linked to LIBOR then my rate would have gone sky high lately but all your previous letters would have made reference to LIBOR and not BofE...errrm really struggling for answers. I ended with adding that with the best will in the world, she had no idea what she waas talking about and having had the 3 key arguments thrown back at her, was unable to justify their corner anymore. We agreed it was beyond her skill set and not her fault that unfair terms and conditions imposed by those that no better had to be dealt with at front end by those that didn't really understand it either. FP can and do behave in a way that suits them and from a legal perspective probably have clause 8 in the agreement allowing this to happen.

“We may from time to time vary our interest rate. We may increase or reduce our interest rate for one or more of the following reasons, namely, to reflect a change that has occurred or which we reasonably expect to occur in interest rates generally or to ensure our business is carried on prudently, efficiently and competitively.”

First Plus Secured Loan, Terms and Condtions, Point No 8.

I think "unfairness of term" is essentially the tack to follow. I have asked them to disclose the mechanical formula that surely sits in place and been denied. I believe from other threads on other sites that someone has had dialogue with FOS or FSA and on 4 points they expected lenders to clarify, FP failed on 2/3 of them, I will try and dig it out,as this will form part of my argument. I ended up not sending my letter as planned wanting one final bit of evidence to attach and when I refind these 4 points my letter will go and be cc into Chief Exec Office and also Chief Exec Barclays.

RED

I don't know if you have followed the whole thread on here

but re your ppi your montHy loan payment has been £455[highest month]

your ppi was £6900 if you claimed on your ppi the maximum you would get is £5460 how could you benefit from this, there is a deficiency of some £1500 [£1460] and you are paying interest on the ppi portion of the loan You would have been better off borrowing the money, you obviously met the criteria for their credit scoring on both ltv and income, and put the money in a savings account for an emergency as it is if you just kept the money at hand the money would have covered you for 15/16 months instead of the benefits of the ppi of 12 months Again we have instigated a complaint of mis-selling with Aly she posted the letter on Monday I would suggest that everyone who is in a similar situation complains but would respectfully ask that people wait until Aly's is finalised. Companies like to isolate these complaints for the least amount of publicity if they get wind that there is a mass/class action they will tend to fight them vigorously so that the whole starts to crumble under pressure of dealing with a big company

SORRY, i FORGOT TO MENTION 1 VERY IMPORTANT THING RE PPI

ON ALL PPI CONTRACTS THERE IS AN OPTION OF A WAITING PERIOD. THIS CAN BE 1 MONTH 2 MONTHS 3 MONTHS [This is the period before you can claim]

If there is anybody out there who has this ionformation could they let me know Also could you check what it says are the benefits re a claim

Thanks Mike

Hi Mike

These interest changes have been posted on Martin Lewis's website by member 'Halifax71':

TIMELINE Re FP all Information

01.03.06 FP Int Rate 8.4% [Halifax 71 I assume start] FHBR 5%

02.01.07 FP Int Rate 8.9% [HALIFAX 71] FHBR 5.5%

01,03.07 FP Int Rate 9.2% [Halifax 71] FHBR 6%

01.05.07 FP Int Rate 9.7% [Halifax 71] FHBR 6% [NOTE TO mYself why?? check Libor BOE] ???????

01.08.2007 FP Int Rate 10% [Halifax 71] FHBR 6% ??????????

Sep 07 FHBR 6,5% Note from memory they didnt increase Alys rate either here check Alys rate and include

Oct 07 FHBR 7%

Nov 07 FHBR 6.5%

01.02.08 FP Rate 10.3% [Halifax 71] FHBR 6.5%

March 08 FHBR 6%

01.04.08 FP Rate 9.2% {Halifax 71] FHBR 6%

02.06.08 FP Rate 9.7% [Halifax 71] FHBR 6%

01.09.08 FP Rate 10.0% [Halifax 71] FHBR 6%

Nov 08 FHBR 6.5%

November 08 BARCLAYCARD TO WRITE OFF £70-80,000,000

December 08 FIRSTPLUS CHRISTMAS PARTY ...BARCLAYS ANNOUNCES CLOSURE OF FIRSTPLUS AFTER HAVING PREVIOUSLY LAID OFF ALL SALES STAFF AND OTHER STAFF WITH A VERY NICE THANK YOU 3 MONTHS GARDENING LEAVE AND ENHANCED REDUNDANCY PACKAGE

EGG FINED £71M BY FSA FOR PPI MISSELLING EGG NOW HAVE A DEDICATED TEAM ON HAND TO REPAY ALL WHO CONTACT THEM

Dec08 FHBR 5.5%

NOTE FROM TIMES ARCHIVE BARCLAYS/FIRSTPLUS CRITICISED FOR DIVERTING TELEPHONE CALLS FROM SUCCESSFUL FP SALESMEN TO BARCLAYS DEDICATED PPI SALESMEN

Hi all

Just a quick update, got an acknowledgement from FP yesterday saying they were investigating my PPI claim & will reply by 9th Jan.

Mike - I have looked again at the T&C's of the PPI but can't see anything about a waiting period before you can claim.

Aly

Hi Aly. Usually with these contracts if say you went online, or through a broker, they would quote say £15 per month with a 1 month waiting period or £20 for no waiting pereiod as these contracts were sold to you then I have to assume then they just quoted the one with the greatest commission [biggest premium] as you have a grip on the contract could you have a look at the benefit section, they will normally have a fixed amount of benefit to cover the repayment whats interesting is [for me and possibly to make a case] what would have happened if say the interest rate went up unusually high if the ppi would still have covered the increased repayment.

If a ppi is sold with say a mortgage you can add 25% for additional costs such as insurance and you would set the benefit at the reversionary rate I.E, someone takes out a mortgage at a fixed rate of 5% with a repayment of £500 the ppi is not set at £500 but at the reversionary rate [the rate that the payment would be after the fixed period ends] say that would be £650 then I would look to have the benefit set at £812.50 that would cover the additional costs plus if the BOE rate and the lenders SVR had gone up then the ppi would still cover the customer.

As i said in my earlier posts it is unusual to have most [not mortgages or overdrafts] lending at a variable rate these are usually fixed at the outset and so there is never an issue that the ppi will not cover the loan repayment. with FP this could be the case and is [possibly] another reason for mis=selling!!

Regards

Mike

For your information we have set the first precedent. We have identified we are speaking to the right people and they have replied within 5 days normally I suggest 10 days to acknowledge and a second letter giving them 14 days to act. They have done this themselves considering they will probably close down for 10 days over the holiday, Good,

Hi Mike

The benefits are: "The most we will pay for any 30 day period is; the monthly repayment on your loan, or 125% of the monthly amount repayable ay the commencement of your loan or £2, 800, whichever is lower"

Our repayments started at £600.80 loan repayment & £147.13 payment protection making a total of £747.93.

I take it this means they will pay a maximum of £934.92 a month? We are currently paying £771 including the PPI therefore the interest would have to go up a lot to put us out of the 125% bracket.

Also, after speaking to 'Halifax71' the other day, she side her PPi claim was successful because she & her husband get full pay for 6 to 12 months if ill or disabled.

My Husband & I also both get 6 months full pay & 6 months half pay if we are sick from work. They know this as they went through a 'demands & needs' questionnaire with us and the copy we have of the questionnaire clearly states this. I assume that they will refuse to pay if one of is becomes ill or disabled and is still receiving full or half pay from our employer so this also makes the policy virtually useless to us - as the policy states Accident or sickness cover is payable if continually disabled for 14 days or more and benefit payable from the first day of disability. I guess this gives us more grounds for mis-selling

Aly.

Hi

i'm mot sure if i'm reading this right. let me first tell you how these things work although some of it may not apply to you it may clarify certain things for other people in different circumctances ,there is something in insurance called indemnity in this contret it means to put you in the position you were in before what ever befell you happened most people identify it with house or car insurance, you have a leak in winter it causes £2000 of damage you claim on your insurance get it fixed you are indemnified to wit back in the position you were in before the accident/tragedy whatever

Although it doesn't work in exactly the same way with this kind of contract the principle is exactly the same

I go and see couple A they both have terible jobs with crap benefits and no sick pay except statutory

I advise a ppi to cover repayment [+ 25%] from day one [premium most costly]

i go and see couple B she/he is a housewife and the other is self employed I elect to effect ppi for sickness from day 1 just on the worker [premium quite cheap as there is only one risk to cover]

i go to see couple 2 who both have good benefits for 6 months i do one ppi on him for 50% [assuming they have reasonable parity] and the other 50% on her NOTE Does this make sense?? with a deferred period of 6 months [Premium is very cheap as there is a 6 month deferred period]

This is a mix and match product there are about 6-8 variables with the contract to suit different circumstances

Self employed ,,,,sickness only

Employed but no benefits day one start

Employed with 3 month benefits 3 month deferment

and so on and the premium reflects the risk

The one thing about the Barclays contract is it is only for 12 months, I have never seen one for 12 months when i provided these they were always 2 years [there may have been providers who used these for loans/credit cards but as I didn't do these I wasn't aware they existted] to allow for somebody who had a major accident/ heart attack or similar some of my clients had benefits for a 12 month so the contract was with a 12 month deferment

So if I am reading you correctly you are telling me that if you had benefits for 6 months you couldn't claim for 6 months on the PPI and then only get 6 months cover ARE YOU SURE!!

Sorry i had to re-post as your page disappeared as I was re-reading it, I don't understand the point re Halifax 71 did they or didn't they put in a successful claim even though they were in receipt of occupational benefits?? Sorry re-read your post as I can't work out what you're saying!!

I have tried to get a copy of this[contract] but haven't as yet.

The clause you quote is a standard clause in all PPI contracts and I can't see your point here either as it doesn't mention any thing about occupational benefts either?? i should have said that these contracts are usually written the way I described as they are not intended to benefit you over and above your indemnified situation what it means is that we would defer for 6 months so this doesn't happen If these policies are all day one then they are totally oversold on indemnity and thus missold

I DO NEED TO HEAR FROM ANYONE THIS HAS HAPPENED TO WHICH IS WHY I NEED to CLARIFY THE HALIFAX 71 POINT

Hi Mike

No i'm not sure - the terms seem a little vague to me so i'm making assumptions that may be wrong.

Initially, we would have expected that we would be able to defer a claim whilst getting full pay (6 months) and then start a claim when the pay drops to half (to make up the shortfall in our income for another 6 months), and then claim full benefits for 6 months when the pay drops to nothing.

However, i'm not sure if that is the case and as Halifax was successful in claiming back the PPI, I'm assuming that the above is not correct

The policy insures both of us, but there is no mention of the cover being 50/50 and no mention of deferment. We are both named on the policy but apart from that, it just looks like a standared sheet with standard T&C's

Aly