I have a question regarding loans, and more importantly extending a loan and details given (stopped working)...

[Byeethan]

My husband have had a loan for a year now, we have never missed a payment.

He had to stop working 6 months ago due to his health but the loan company were never informed and we pay it without any problems (its our main priority to do so).

However lately, due to the incompetence of the bank and charges they have given us we are struggling in other areas.

The loan is £xxx over 3 years. We have looked on the webite and see that we can extend the loan to 4 or 5 years, thus generating money for us (to organise our other finaces) but keep the replayments at the same rate but over an extra year or two.

We have decided this is a real possibility for us as DH will be working in the new year again (but even whilst he hasn't been the payments on the loan haven't been a problem)

Basically, when we ring to apply for this should we mention he is out of work?

I assume if they knew that we wouldn't be able to do this, but considering we haven't missed a payment in the time he has been at home I think this unfair.

Would you not mention it?

We have a loan with another bank, not our own. It is OUR own banks that are the problem

Am off to bed soon, would appreciate any opinions or input!

ok, never mind!

I would ring and ask them. If they ask if there have been any changes in your circumstances, tell them. But I don't think they will ask.

i would be honest, they will see that you have paid the payments, but i think lying on a loan application is fraud, and you could be in a whole heap of trouble if found out.

call them and explain your circumstances and see what they say?

Yes, but then if they say no because we were upfront we are buggered!

I suppose my husband will have to just ring and see how the conversation goes.

Oh, I thought you were extending the term of your current loan, not borrowing more...

That's different, and they may well ask you about income then. Sorry.

I'd be tempted to not say anything! But I'm not sure about the legalities of doing that would be if they found out for some reason. You could have obtained a loan fraudulently or something like that.

Is it really not an option to tell them? Is the loan secured on your house?
I was just wondering why it's the main priority to pay them every month.

No not secured on our house, its a small amount in the realms of loans really.

Its our priority to pay it as we want to keep a clean credit rating as we will want to buy a house at somepoint.

I'm getting confused here!!
Are you extending the term of your loan or are you adding money to the existing loan as well as extending the term?
Because you say you're extending the term to generate some more cash, but the monthly payments stay the same?

The loan is over 3 years at repayments of £xxx

We could just apply for more money and add it onto the monthly payments but that would make the repayments go up. We can afford them now at £xxx but no more.

So we borrow more money, but instead of the payments going up they stay the same but an extra year of repayments is added,

so instead of paying it back over 3 years we pay another year aswell.

Hope that makes sense

from the site ...

You can borrow any amount from £1,000 to £25,000 and either extend your loan term keeping your repayments similar, or increase your monthly repayments and keep your loan term the same.

we want to increase the term keeping the payments the same.

I think you mean you are going to increase the amount of the loan which will mean paying the same amount per month, but over more months in total?

If they ask you need to tell them or it's fraud. Presumably you are working though, or you have other income, as you have still been paying, so if an income and expenditure statement shows you can afford the payments, don't see why the fact he isn't working should be a problem.

So do benefits count then?

Obviously its not an ideal situation but we are on the same amount of money now as before anyway, DH had a low wage job.

He is finding it very stressful as he wants to return to work but GP won't allow it yet, he takes things very personally.

So do they care where the money is from as long as it is there?

Byeethan, the honest answer is I don't know TBH, I'd like to think that income is income, but I'm not sure if it would pass their scorecard.

If your problems are to do with charges caused by another bank's incompetence, are you able to give us any details there? If the charges are because of bank error, they should be refunded and I think if you make enough fuss, they will be (provided you haven't contributed to the error)