Are you being contacted by 247 Loans UK about your outstanding loan? Are you struggling to repay the loans you have? You may even be getting threatened about court action? Was the loan unaffordable and you should never have received it in the first place? If these are the problems you are having with 247 Loans UK or the problems are similar, then this article is just for you. You might be able to cancel your loan and even obtain a refund.
It’s not your fault. Complaints to the Financial Ombudsman have risen this year from 830 to 2,006, so it’s safe to say that you’re not alone.
Deal with your debt today and feel better tomorrow.
Who are 247 Loans?
247 Loans, also known as 247Moneybox offers short-term loans of up to £800 with a repayment period of 29 days. The company was established in 2009 and is regulated by the Financial Conduct Authority. 247Moneybox is a registered principal lender.
Read what to do if you can’t pay back your debt.
Do loan companies make it too easy to borrow money?
It is so easy to borrow money through lenders. The web is crowded with companies that are happy to advance you cash within a few minutes; to approve you for a loan of up to £1,500 in just seconds; to advance you money instantly without any credit checks. Many offer loans to people who have a “Very Bad Credit” history or who are already having difficulty repaying loans.
Why debt problems exist and what the government is doing to combat it
When you consider that so many companies were lending to people who couldn’t afford it, it is no wonder that so many people have ended up facing debt problems. Although the situation today is a lot better than it has been, it is still bad, but new regulations came into force as a result of debt problems spiralling. The loan market reached a point where it was at £2 billion at one point, which was a result of lenders providing loans to people who couldn’t afford it, as well as charging excessive interest rates.
The Financial Conduct Authority ended up having to impose fines on some of the biggest lending companies out there, including Quickquid, Wonga and The Money Shop. Some of these fines were so high that many of these loan companies went bust, including one of the biggest, Wonga. The fines were issued as the lending companies were providing loans to those who should never have received them, as they used “limited criteria.” The regulations have resulted in a drop in the number of loans issued, as well as the number of lenders.
Are you due a refund? Read through the next section in which we look at these new rules in some detail. If 247 Loans UK is in breach YOU MAY BE DUE A REFUND EVEN IF YOU HAVE PAID OFF THE LOAN.
Loan interest and other charges – government caps
The Financial Conduct Authority introduced price caps which protect borrowers from being charged excessive charges. These include:
- A cost cap of 0.8% per day on the value you have borrowed – this includes interest and fees
- A cap on default fees of £15 – interest may still be charged after a default, but it cannot be more than the original rate of 0.8% per day.
- A complete cost cap of 100% – you should not be asked to pay more than 100% of the money borrowed.
The limits on these apply to all credit agreements with an interest rate of 100% or more per year and that will either be fully or substantially paid back within a year.
There were other regulations which came into force in May 2017. According to these, lenders must give details of all products on a price comparison website, which must be authorised by the FCA. Borrowers must also be provided with a summary, showing the cost of borrowing.
If 247 Loans UK are found to be in breach of these regulations and they are attempting to charge you more than they should, your credit agreement with will be unenforceable and therefore, they cannot make you pay back the loan.
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There are many so-called loan companies who are undertaking business when they are not permitted to do so. Authorised businesses are allowed to make credit agreements, but if they are not authorised, they cannot enforce the payments. This means that if you decide not to pay them, they cannot do anything about it.
If you wish to check whether 247 Loans UK is authorised, you can simply enter the name of the company on this Interim Permission Consumer Credit Register search page. You are also able to check authorisation by searching on the financial services register here. If there is no valid up to date entry on any of these registers, you can stop paying them. They will not be able to enforce the payments.
There are other signs that 247 Loans UK are not operating legally, include little information on the company website, out of date information on the website or information that is different on the directories. Non-disclosure of the APR is another sign.
What if you wish to make a complaint about 247 Loans UK?
If 247 Loans UK have been in breach of the regulations, and you feel they are not treating you fairly, you may want to make a complaint. If you make a complaint to 247 Loans UK and they fail to follow it up after eight weeks, you would be able to escalate it to the Financial Ombudsman.
In order to make a valid complaint, you must have evidence to back it up. These may include text messages, emails and letters. It could be the case that they have called you too much, and in this case, your evidence might be your call log. You should write to 247 Loans UK with details of the complaint, and how you want the company to resolve the situation.
If 247 Loans UK do not provide you with a satisfactory conclusion, you may wish to escalate the complaint to the financial ombudsman. You can reach the Financial Ombudsman by phone on 0800 023 4567 or 0300 123 9123
If 247 Loans UK are found to have treated you unfairly, you may be able to get a refund even if you have paid it off within six years. You may also be entitled to any interest you have paid on the loan, as well as all additional charges paid. You may also receive 8% interest on all payments you have made.
Your loan may have been unaffordable, and in this case, you can get it taken off your credit record. The outstanding balance may then be cancelled.
You should write to your lender, in the first instance, stating your case and requesting that they give you confirmation.
If there is no satisfactory response within 8 weeks you may wish to follow it through by calling the Financial Ombudsman byphone on 0800 023 4567 or 0300 123 9123.
Continuous Payment Authority – what are the new rules?
You might not be aware but loan companies usually set up repayments on a Continuous Repayment Plan (or CPA.) With a CPA, the loan company can take payments whenever they wish, until the full amount is paid off. Although they should let you know their plans to do this, they often don’t, which can leave debtors in a difficult situation. As a result of this, you could be left without any money in your account, when you leave expect it.
If you are not able to pay your essential bills, such your rent or mortgage, and this money is taken without your knowledge, it could lead to your home being put at risk.
Thankfully, there have been new regulations brought in regarding CPA, which are designed to protect borrowers from being left without any funds in their account.
These new regulations state that loan companies must not take partial payments from the borrower. If the full amount is not available, they must not take any money at all. You can speak to the lending company and ask them to take partial payments, but they cannot do this without your express permission. If they do take partial payments, they are in breach of the regulations.
According to the legislation, loan companies must not attempt to take the payment on more than two occasions. If they do this, they are also in breach of the regulations.
If they do make more than two requests or they take partial payments without you giving them permission, they will be breaching the regulations. This means you can report them to the financial ombudsman on 0800 023 4567 or 0300 123 9123.
What to do if you are unable to pay the loan back?
If 247 Loans UK are operating in a legitimate way, but you can’t afford to pay the loan back, there are some things you can do. If you have a CPA, direct debit or standing order set up, these are some steps you can take.
You can contact your bank, and request that they cancel the CPA, standing order or direct debit, or you can do this yourself online. This means that 247 Loans UK will not be able to take payments from your account and you will again, have control over your bank account. It is a good idea to contact the lending company prior to cancelling the payment, but you have no legal obligation to do so. When you cancel the payment, they won’t be able to take any more payments, until you give them permission.
Regardless of whether you cancel the payment, you still the owe the money, and it is important that you take steps to pay it back. There is no point in hiding from your debt problems, and they will always end up finding a way back to you. You should contact 247 Loans UK in the first instance, and discuss your financial situation with them, and what steps you want to take to pay the debt. No matter what your circumstances are, they should be able to help you and reschedule your payments to suit.
These are some rules that lenders must adhere to:
- Indicate where debtors can obtain free independent debt advice
- Ensure debt recovery is held off for time before while a repayment plan is devised
- Allow you time to repay the money, freezing interest and charges, wherever applicable.
Don’t roll the loan over
247 Loans UK may say that you should roll the loan over, as this allows them to make more money in interest and charges. This is not a good idea though, the best course of action is to pay off your loan, even if you need to do this through a repayment plan. You should be aware that you are not able to roll your loan over more than twice.
How to get debt help
There are a range of organisations out there who provide free independent advice on your debt situation. These are just a few of them:
Should you trust loan companies?
Loan companies receive a bad press, but this isn’t always fair. In some cases, lending companies offer a valuable service to those who really need it. Some people cannot get access to loans elsewhere, especially from the bank. They should not put their profits first though, they should ensure that they are only lending to those who can afford it. Many exploit their customers, unfortunately, and although the new regulations have helped somewhat, many people still face debt issues.
If 247 Loans UK are not following the regulations, you are not entitled to pay them as the debt cannot be enforced. If you are not able to pay back the loan, you should contact one of the organisations we have listed above, as they will be able to provide you with free, independent advice.
If you can’t pay back your loan do check out my other article here.