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Renewal of loan

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  • 24-09-2010 10:51am
    #1
    st1979
    Registered Users Posts: 936 ✭✭✭


    Bank have sent new loan agreement but want to put up my interest rate considerably. I am on interest only and will be reducing the loan balance considerably soon so they want now to increase the interest rate which will make my monthly repayment still the same as it was before the reduction of the capital. I am afraid every time i will get close to paying back the loan they will push rates up. The loan is asset backed by letter of guaranttee. I have other assets with no loans against them. As far as i can see they want to screw me as long as possible and then reposses. I would like a mortgage and pay it off over 20 yrs which would be the same as my existing interest only payment.


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    #2
    dobsdave
    Closed Accounts Posts: 1,814 ✭✭✭dobsdave


    st1979 wrote: »
    Bank have sent new loan agreement but want to put up my interest rate considerably. I am on interest only and will be reducing the loan balance considerably soon so they want now to increase the interest rate which will make my monthly repayment still the same as it was before the reduction of the capital. I am afraid every time i will get close to paying back the loan they will push rates up. The loan is asset backed by letter of guaranttee. I have other assets with no loans against them. As far as i can see they want to screw me as long as possible and then reposses. I would like a mortgage and pay it off over 20 yrs which would be the same as my existing interest only payment.


    1. Paragraphs would make it easier to read

    2.What is your question?


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    #3
    nlgbbbblth
    Closed Accounts Posts: 5,668 ✭✭✭nlgbbbblth


    were you supposed to start capital and interest repayments after a pre-defined interest only period?

    if you were, and then said you couldn't honour this arrangement then the bank is entitled to reprice the facility.


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    #4
    stepbar
    Closed Accounts Posts: 6,123 ✭✭✭stepbar


    nlgbbbblth wrote: »
    were you supposed to start capital and interest repayments after a pre-defined interest only period?

    if you were, and then said you couldn't honour this arrangement then the bank is entitled to reprice the facility.

    This is correct. The bank's raw material (aka money) costs more to obtain and therefore the price they charge the customer is obviously going to be passed on.


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