Advertisement
Help Keep Boards Alive. Support us by going ad free today. See here: https://subscriptions.boards.ie/.
If we do not hit our goal we will be forced to close the site.

Current status: https://keepboardsalive.com/

Annual subs are best for most impact. If you are still undecided on going Ad Free - you can also donate using the Paypal Donate option. All contribution helps. Thank you.
https://www.boards.ie/group/1878-subscribers-forum

Private Group for paid up members of Boards.ie. Join the club.

Fixed Term Loan

  • 20-08-2010 11:32AM
    #1
    ascuteasabutton
    Registered Users, Registered Users 2 Posts: 199 ✭✭


    Hi just looking for some advice/opinions on this..we took out a 5 year Fixed Term,Variable Interest Rate Loan, the last repayment is due next month but the bank in question now says that we still owe €900 in Interest?

    How can this be? Surely as the Interest Rate Changes the monthly repayment is adjusted and the loan should still be finished next month as it is Fixed Term?


Comments

  • #2
    titular
    Closed Accounts Posts: 19 ✭titular


    ascuteasabutton wrote: »
    Hi just looking for some advice/opinions on this..we took out a 5 year Fixed Term,Variable Interest Rate Loan, the last repayment is due next month but the bank in question now says that we still owe €900 in Interest?

    How can this be? Surely as the Interest Rate Changes the monthly repayment is adjusted and the loan should still be finished next month as it is Fixed Term?


    It will depend on how the repayments to the loan were structured. If you paid by Direct Debit, this should have been the case and I would question the bank as to why they did not take increased payments.

    If, on the other hand, as I suspect, your payments were transferred by means of standing order, then the same amount will be transferred until such time as they are manually amended.

    I am unsure as to why the repayments would be structured in this manner but an easy way to check if this was the case is to check your current repayment amount against the initial (ma be on the loan agreement) if they are the same then it is likely that this is the issue.

    You may be able to press the institution as to why they set it up this way and why they never advised you to increase the payments with subsequent intrest rate hikes.


Advertisement