Banks and lending institutions in the UK have not enjoyed much in the way of good publicity lately. With the recent scandals involving payment protection insurance and interest rate swaps that have cost businesses and individuals billions of pounds, it perhaps it not all that surprising that many of these lending institutions have also engaged in business loan overcharging.
From simple loans to highly complex financial services, many of these banks have either intentionally or unintentionally charged higher interest rates for loans or have hit borrowers with higher fees than the law allows. Unfortunately, given the nature of such overcharging practices it may be difficult for the average borrower to see how they are being overcharged.
While some banks have blamed this on technical issues which has born out to be true in some cases, the sheer extent of the number of overcharging incidents can hardly be accounted for by just technical issues. This trend indicates that business and individuals who are receiving these loans need to take substantial steps to avoid being overcharged.
One reason why many instances of business loan overcharging is performed can be laid at the feet of the financial institutions themselves who do not review all the facts and often overlook many of the rules and regulations that are supposed to guide them in providing proper loans. Whether due to carelessness, oversight or incompetence, the truth is that these types of mistakes happen far too often.
Here are a few ways to avoid being overcharged on your next business loan. By taking a little extra time and acting promptly, you can save yourself a considerable amount of money.
Double Check the Interest Rate: Before you sign the dotted line, double check the interest rate and the fees that are being charged as well. By fully reading the contract and the stipulations that the loan has, you can avoid making the mistake of being overcharged.
Act Quickly if You See Unusual Charges or Interest Rates: First, you should have a full copy of the loan contract with the pertinent information highlighted so you can then double check it against the monthly payment. Once you see something out of line occur, immediately talk to the financial representative and discuss that particular issue.
Remember that this could very well be a technical glitch, so don’t get angry. What you need to do is calmly present the facts and let the representative take it from there. If it turns out to be a technical glitch or mistake, then it will be corrected and you will not be overcharged. However, if it turns out to be something more serious, then you need to meet with the people in charge so you can get this straightened out.
By being a little careful, doing some double checking and being proactive, you can avoid many of the pitfalls of business loan overcharging. Just remember to keep a cool head and focusing on catching the overcharges before you or your business actually pays for them can save you a considerable amount of money.