Tuesday 17 October 2017

How consumers can get an illegal loan written off

It is illegal to be given a new moneylender loan before an existing one is paid off
It is illegal to be given a new moneylender loan before an existing one is paid off
Charlie Weston

Charlie Weston

Thousands of people who got moneylender loans topped up may be entitled to get it written off and receive compensation.

It is illegal to be given a new moneylender loan before an existing one is paid off.

A ruling by the financial services ombudsman has set a precedent for compensation, experts said. This only applies to moneylending borrowings.

Anyone affected should first challenge the moneylender about their loan. If they are unsuccessful, they can take a case to the ombudsman, a free service.

To take an ombudsman case you need a letter from the moneylender refusing to offer you redress.

However, many people will face a dilemma if they make a claim to their moneylender.

A loan from the moneylender may be their only source of credit, even if interest rates are as high as 188pc.

Moneylenders may refuse to deal with people who are seeking a loan write off and refunds from them, prompting some soul searching for affected consumers.

The best bet is make a claim, and open a credit union account.

Irish Independent

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