I've been indepted to a local bank for 15 years or more to date - as a result of a initial small business loan of £2,000 that was obtained, and the refusal of the bank to honour their promise to support me with a follow up loan. As a result i hesitated to honour my commitment, only to end up with a mounting dept of almost £30,000, with a daily interest rate of £10. a day. Can i negotiate for a reasonable settlement? considering that it may take me a life time to settle this loan. Thank you.
Is this an FSA regulated bank or a money lender? If the follow up loan was written into your first loan agreement you may have recourse. Otherwise they have defaulted on a handshake and you have defaulted on a signed and legally binding contract. If you are experiencing financial hardship an FSA regulated bank is obliged to by sympathetic and had probably signed up to The Lending Code. This is a set of guidelines based on ethical lending - it may give you an idea about what you can use as a bargaining chip.
There is nothing to stop you negotiating with the bank, but I do find it strange that an original debt of £2,000 ends up with your owing £30,000. If they are a regulated organistion, then you may need to discuss a complaint with the Financial Services Authority, and if they are not regulated then your local Tradings Standards department or the Office of Fair Trading are other good ports of call.
