£5,740 debt which mushroomed to £384,000 ‘no different from similar credit agreements’

A LOAN which mushroomed from an original $5,740 to £384,000 and which was cancelled after a judge described it as extortionate, was no different from other similar credit agreements, the Court of Appeal in London was told yesterday.

In a case with wide implications for the lending industry, London North Securities is challenging a ruling that wiped out Tony and Michelle Meadows’s £384,000 debts.

The Merseyside couple had taken out a £5,740 home improvement loan at an annual interest rate of 34.9% in 1989 and ended up facing repossession.