Late Installment Fee

12 05 2008

Posted By Yousef

C’est la vie wrote me an email and raised an interesting issue for those of you who have to pay for loan installments every month.

She said that whenever there is an overtime or a bonus to the salary credited to your bank account before your actual salary is due (even the new 120kd which was credited a week before the salary), the bank starts the process of deducting the loans’ installments believing its your real monthly salary. Leaving you without money until the real salary is due and when the real salary is credited to your account, they deduct the rest of the loan’s installment. What most people fail to realize is that when they do that, the system thinks you were late for the due payment and they then charge you a tiny fee, when in fact you’re not late for the installment, it just, they were a week early.

She’s talking based on her experience with NBK but she also said that a lot of other banks do this. She believes that a lot of people aren’t aware of this little glitch in the system. “people don’t notice coz its a small amount of money, but if enough people where charged, the amount would be huge.”

Thank you C’est la vie for sharing this with us.



2 responses

12 05 2008
c'est la vie

Thank you Yosef alot for posting this and its all right , but to credit the NBK bank they returned the 120 kd allowens to the people that they took from them before the salary and payed the 120kd shortage of their loan installment from the NBK private account as “ta3weeth ” for their mistake . but people should keep watching their installment .

12 05 2008
Leroy Glinchy

Thanks for posting this. I agree that there are many, many small fees that can be deducted from your bank account and loan payments. The more people know about this, the better.

This is one of the reasons my wife (an accountant) suggests posting all bills manually. It gives you more control. Of course, this takes more discipline, but this is money so it should be a priority. 🙂

Other tricks are making sure there is money in account when the bills are posted. Otherwise, you can get a overdraft fee even if funds are on the way. Sometimes, you can post a deposit and it does not get credited before the loan company takes their cut.

Then there is the trick of loan companies taking money and holding it and posting it to interest in the future unless you make it clear that the money should be used to pay down priciple. I had this done to me even after I sent them a letter telling them explicitely to put all excess cash into principle.

As Mishary & Yousef saud, you should always look for small fees and investigate why they are charged.

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