Did you know you could get a refund from Ratesetter Loans?
If you have a loan with Ratesetter Loans or you are struggling to make monthly payments, then you may be due a refund. If you are have missed some payments or you’re having other problems with your Ratesetter loan, then this article is for you. Many of our readers have been able to cancel their loan or even get a refund!
New regulations for Ratesetter Loans
Until recently the lending industry was worth over £2billion. This high level of borrowing was largely fueled by what was seen as irresponsible lending. It’s estimated that as many as 8.3 million people in the UK have debt that they cannot pay off as well as not able to even make payments on their household bills.
The Financial Conduct Authority decided that the time had come to take action. They first looked at the unfair practices and irresponsible lending choices and next created a new set of regulations to protect borrowers.
So, what are these regulations and how can they help you?
If Ratesetter Loans didn’t follow one of the recent new laws, then you could claim for a refund!
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1) Affordability regulation
One of the most disruptive regulations launched by the FCA is that the lender must ensure that the loan is affordable. This is the regulation that put Wonga out of business and also the one that has allowed thousands of borrowers like you put in a claim for a refund.
The regulation states that you should be able to make the loan repayments as well as pay for other aspects of your life such as rent, bills, cards and food. If you feel like Ratesetter Loans didn’t do a sufficient affordability assessment on you when you took out the loan then you may be able to claim for a refund. Check out my blog post on how to claim for a refund on your loan.
2) Interests and fees regulation
Another thing that the FCA noticed was that lenders would often charge borrowers excessive interest and fees. They remedied this by putting a cap on fees and interest. The limits were, (a) a 0.8% cost cap – this includes all interest and fees. (b) a £15 cap on default fees. (c) 100% complete cost cap, which means you should never have to pay more than double what you borrowed.
Have you taken out a loan with Ratesetter Loans? If you did and you feel that they have breached any of these regulations, then you should consider requesting a refund.
3) Continue Payment Authority regulation
You’ll find with most lenders that they make you agree to them using Continuous Payment Authority (CPA). This gives them permission to go into your bank to take money any time they want.
This was fine, however companies started abusing it, trying to take money multiple times a day. Imagine being paid at 9am and then at 10am it all being withdrawn from your account, leaving you no money for rent, bill etc.
The new regulation around CPA come in two parts. (a) if Ratesetter Loans try to take money via CPA twice and fail, then they cannot try again. (b) the amount taken must be the full amount of the payment due. They are only allowed to take a partial payment if you have agreed it with them by agreeing on a temporary payment plan for example.
If Ratesetter Loans have attempted more than twice to take a payment or they have taken a partial payment without your permission to do so, then you should consider claiming for a refund.
Can’t make your next payment?
If you don’t think Ratesetter Loans has breached any of the regulations then there is still steps you can take to protect yourself and your money. As a reminder, Satsumer Loans are obligated to treat you fairly, which means that they will work with you to get you back on track. Don’t bury your head in the sand! Follow my guide here on what to do if you can’t pay back your loan.
Thinking about making a claim?
There is a good chance after reading this that you may feel tempted to make a claim for yourself and believe me you are not alone. In fact, during 2017 alone the Financial Ombudsman Service received 10,529 complaints that related to these type of loans.
If Ratesetter Loans have treated you unfairly then you may find that you are entitled to a refund. At the very least you can expect to get a refund interest that was paid during the term of the loan, as well as any additional charges. For some people this could be a rather impressive amount of money to receive back.
s or they take a partial payment without your explicit permission they are in breach of regulations. You can report them to the financial ombudsman on 0800 023 4567 or 0300 123 9123.
What to do if you simply can’t afford to repay the loan?
If Ratesetter Loans UK has operated legitimately but you simply can’t afford to repay the loan, there are some steps you can take to protect yourself.
If you are paying them by CPA, standing order or direct debit, you should contact your bank and cancel these. Ratesetter Loans UK will no longer be able to collect payments automatically and you will retain control of your bank account. Your bank may advise you to inform Ratesetter Loans UK that you have done this, but you are under no legal obligation to do so; they will be unable to collect any money from you until you give them explicit permission to do so.
Of course, you will still owe them money so you must deal with that directly; while you might be tempted to do so, don’t hide your head in the sand. Your first approach should be to contact Ratesetter Loans UK and talk to them about your problems. They are obliged to treat you fairly, so you should be able to come to an agreement to reschedule your repayments.
By law, lenders must:
- Indicate where you can obtain free independent debt advice
- Hold off debt recovery for a reasonable period while you develop a repayment plan possibly using a debt advisor
- Giving you reasonable time to repay possibly freezing interest and additional charges.
Don’t roll over your loan
Ratesetter Loans UK might suggest that you roll over the loan, but doing so is almost certainly a bad idea. You will be charged even more interest and additional charges leaving you in even deeper debt. By law loans can be rolled over no more than twice.
Getting debt help
There are several organisations that provide free independent advice on debt:
Are loan companies all sharks?
There is little doubt that loan companies receive a bad press. It can be argued that they also provide a valuable service by offering a credit line to people who would be unable to obtain credit from a bank or credit card. It is only when these companies place profits ahead of everything else and exploit their customers that they do real harm. While some sharks remain, the new regulations have made it much safer to use these companies. However, many people still get into debt problems.
If Ratesetter Loans UK are in breach of the regulations, then you are entitled not to pay them as the debt is unenforceable. If you simply can’t afford to pay, then contact one of the organisations we have listed above, they will provide the help and guidance you require.
If you can’t pay back your loan do check out my other article here.
John (Money Nerd)