Personal loan repayment increased after date change.

P

Pablo74

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Hello,
Back in Feb of this year I asked my branch of AIB if I could change the date of my loan repayments (say from the 14th to the 21st) as it was within the same week of my Mortgage repayments and things were tight. They said fine and the loan repayment date was changed to a week later to give me some breathing space.
In March my loan repayment was deducted on the 21st but had increased from €230 to €277. When i queried this, the lady at the counter said that she would look into it.
I received a letter today from my bank saying that my loan was a variable loan and over the years the interest rate had increased numerous times. If i continued paying the €230 per month , it would leave me a shortfall of €1600 after the final due date in 2016. So the bank has increased my loan repayments ( which put me under severe pressure) so that there is no short fall in 2016.
I actually dont think i will be able to continue paying the loan at that repayment level. I dont think it is fair that i go to the AIB to change a date so I can Pay my loans and end up having to pay €47 more a month.
Any ideas what I could do ?
 
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Dig out your original loan documentation and see what that says. I'm fairly certain that all of my variable rate loans (all with BoI) said something along the lines of "end date may change due to variable nature of interest but this is done in order to ensure your agreed payment per month remains the same". So first you need to make sure what your loan agreement actually says - do you have a definite end date and payments have to be adjusted to keep up with interest fluctuations (in which case you should have seen numerous changes over the years since you took out the loan) or do you have a more flexible term with fixed payment amounts?

I would probably have assumed that the extra €47 in March was to make up for the extra week, i.e. a pro-rated payment for that portion of the month. Was the €277 taken in April as well?
 
First port of call is to call to AIB and discuss the repayment schedule. They may well agree to extend the loan term and reduce repayments to close to the original/affordable level. It would appear that they may have made an error in not increasing your repayments earlier. If so, you have a legitimate reason for requesting an extension of the term.
 
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