i took out a loan a month ago and now want to settle it but the bank has put £500 fees on it, is this really allowed?
2007-12-02 23:05:26 · 18 answers · asked by kirstine a 2 in Business & Finance ➔ Credit
For a fixed term loan, yes. Sorry. Only revolving credit (Credit / store cards) can be paid off withou penalty.
Complain to the bank, but you are unlikely to get anywhere.
Good luck.
2007-12-02 23:11:31 · answer #1 · answered by Telf 4 · 0⤊ 1⤋
Depends on what was in the original loan contract. Some lenders include penalties for early re-payment. Is the 500 interest, or just fees? Read the loan contract. If it is not mentioned in the contract, go to the bank and ask an officer there. One month is a relatively short time for a bank to carry a loan. They may have a minimum amount they are allowed to charge in interest or other fees.
2007-12-02 23:14:11 · answer #2 · answered by ~RedBird~ 7 · 0⤊ 0⤋
Yes it is allowed, if it is in the terms of the loan that there will be an early redemption fee, then it must be paid I am afraid. You could query it with the bank but I don't think they will waive it as they are missing out on 3? 4? 5? years of interest - they have to make money from somewhere, unfortunately it is us wee people who lose out.
2007-12-02 23:08:55 · answer #3 · answered by Kerry K 6 · 1⤊ 0⤋
Hi,
The answer is YES.
Banks do have such kind of policies because your EMI depends on the amount of money you have taken from the bank, then on the money bank puts some interest which is calculated by dividing the total sum+interest.
Now from somewhere you got a big amount of money and u thought of clearing your loan.
Here what has happened is you have paid the total sum but what about the interest the bank was going to get form your repayment.
The bank is not going to let it go easily, so they have come with this policy of charging the amount as penalty.
This is completely legal.(Procedure by RBI)
I hope u understood.
Bye
2007-12-02 23:17:05 · answer #4 · answered by Sachin S 2 · 0⤊ 0⤋
If it's in the contract, they can and will charge it. Banks are in the business of making money off the little people, and this is just one example of how they do it. They make hundreds of millions of dollars every year by charging those pesky $35 over-draft fees on $2 purchases. It's a big scam, but they're good at it.
2007-12-02 23:09:06 · answer #5 · answered by Adam B 1 · 1⤊ 0⤋
Holy cow!!! that's very severe. Get some greater rates and attempt the non-public loan businesses at as quickly as you will possibly desire to no longer be reamed with that "brokers value". playstation I paid a pair of hundred funds for my refi by way of Wells Fargo residing house very own loan.
2016-10-18 23:23:20 · answer #6 · answered by lumley 4 · 0⤊ 0⤋
they can do, when loan companies advertise online, they usually say something about early settlement fees.
Try and speak to someone, like in a one to one room or something, show them that you are a good customer and hopefully they should waiver some of the fees
2007-12-03 10:11:33 · answer #7 · answered by Rebz 5 · 0⤊ 0⤋
Banks can, and usually do, charge whatever they want. They are banks. B A N K S = licence to extort money.
Read the small print. If it's there then you agreed to it (always read the small print first!) and ought to pay.
You could try appealing to commonsense and decency, but remember : it's a BANK!
2007-12-02 23:09:32 · answer #8 · answered by za 7 · 1⤊ 0⤋
Sorry, but yes they can. You should have been advised of this when you took out the loan, or at least read the Loan Agreement properly.
2007-12-02 23:13:36 · answer #9 · answered by Anonymous · 0⤊ 0⤋
Yes it's in the small print READ before you sign for the loan.
Early settlement doesn't mean avoidance of the interest
2007-12-02 23:08:41 · answer #10 · answered by Anonymous · 1⤊ 0⤋