Readers' Forum - Have Your Say

A tradesman and his repossessed vanA reader contacted us with a disturbing story of a bank's repossession policy. He bought a Mercedes van in 2006 for €13,500. He used €4,500 of his own money and he took advantage of a forecourt finance deal and borrowed €9,000 from the Bank of Scotland.

For nearly four years he paid €199 a month plus a once-off €75 administration fee. He made all payments in 2006, 2007, 2008 and up to June in 2009 when he missed three payments in a row because his work dried up – he is a self-employed tradesman.

He says he contacted Bank of Scotland to discuss the problem but claims that they did not want to know. They sent a repo man who took his van, allegedly with his tools inside.

He contacted the bank again and was told that the only way he would get the van back was to pay the €1,900 which was outstanding on the financing deal. He got a loan and lodged it into their account and once more asked for his van. They said they could not see the money in their account and said they would have to wait until the next week. The following week they confirmed the money was in the account but then dropped the bombshell that his van had been sold.

He eventually got half his tools back, he says. We contacted the bank with a number of questions. Specifically, we asked why our reader was told one thing – that if he paid the loan off in full he would get his van back – when something else happened? We asked why his tools and paperwork were removed and why, it appears, all his tools not returned? We also wondered how much the bank sold the van for at auction and asked if the bank accepted that it had deprived this man of his livelihood despite the fact that he had paid his debt in full as he was requested to do by the bank?

The bank refused to make any comment at all and said it was unwilling to discuss its dealings with any of its customers.

The story does highlight a problem with forefourt financing, which the National Consumer Agency addressed last week.

“Hire purchase agreements are often presented as ‘car finance deals’ and as a result many consumers think they are signing up to a personal loan,” the NCA’s chief executive.

“The key difference between a personal loan and a hire purchase agreement is that with a hire purchase agreement you don’t own the car. The car is owned by the car finance company and ownership is only transferred to the consumer once the final repayment has been made. This means if you run into difficulties, you cannot sell the car to repay the debt”

The rising price of Aptamil baby formula

A number of readers have been in touch in connection with a fairly hefty increase in the price of baby formula. Anne O’Brien was one of them. She was prompted to contact us after the price of Aptamil First Milk 900g increased from €9.65 to €10.49 in her local Tesco. The price increase was mirrored by the other big retailers doing business in the State.

“I suspect this is because sterling exchange rates are not in Tesco’s favour at the moment,” she writes.

She points out that mothers with small babies on formula cannot simply choose to buy another product, or go for an own label version to save money “so these increases by the supermarkets are pretty severe and excessive in my opinion. A 9 per cent increase on any product can hardly be justified in this climate. Is there anything you can do to investigate and highlight that the supermarkets are seeking to profiteer on baby formula?”

We got in touch with Tesco and the retailer issued the following short statement. “Tesco’s purchasing arrangements for Danone Aptamil are conducted on an international basis for the Irish and export markets. The price change reflects the exchange rate movements that have taken place in the past few months.” For its part, Superquinn said part of its pricing strategy was based on a careful monitoring of competitor prices and then matching them. It says it increased the price of Aptamil on June 7th in the wake of the Tesco move.

We did point out that the store could have kept its price for baby formula lower than Tesco in order to attract more customers with young children but our suggestion fell on deaf ears.