The 2 representatives of the lender told us that this loan was the cheapest in the area, only 10%.
When we agreed to this and went to the lenders office to sing the legal documents, it turned out that the 500.000 PHP was not available.
But instead we could lend 100.000 PHP.
Everything was talked over in Visayan, when my wife was ready to sign, I asked my wife if this loan was OK.
She answered me YES.
My wife signed the contract but we never got a copy.
My wife paid the monthly payments.
Later after a view months I asked my wife why there is not enough money left monthly from my pension.
She told me that the loan was very expensive.
And she was afraid to tell me that the loan was actually 120 % per year.
That got me thinking.
For the 100.000 PHP loan we paid 20.000 PHP monthly.
If we would get the 500.000 PHP we would have to pay 100.000 PHP monthly.
The lender was aware of my income a pension of 80.000 PHP monthly, but initially agreed to lend us 500.000 PHP.
In the mean time I went to Negros Oriental looking for a house to rent.
There I got a call from one of the representatives that a payment was overdue.
I asked her how much and she answered me 120.000 PHP.
She also told me that my wife who was still in Davao Oriental was very sick and dying, and that I better pay the loan before things got worse.
This turned out to be not true.
I asked the representative how much the remaining balance would be if I would pay the remaining balance, because normally if you pay a loan as I offered 5 months earlier the interest would be lower.
The representative told me that would not be possible.
Instead I had to pay interest for being late.
I don’t think that is legal.
Because I think it works both ways, if you pay earlier you pay less the lender is rewarded by paying less interest.
And when you pay late the lender is rewarded by getting more interest.
We are 2 months late 2 X 20.000 PHP = 40.000 PHP which i am prepared to pay if this is a legal loan.
The lender wants a total of 65.000 PHP for being late.
Can you advice me in this matter.