We have to pay ?11,000 extra to settle loan

Regrettably I took out a secured loan two years ago to carry out essential repairs on my property.

I was attracted by the adverts and presumed I was getting a good deal at the time. The repayments have put my family in financial difficulty and I want to reduce our outgoings as I don't earn enough to cover them. I would like to remortgage and clear all the debts but the problem is a settlement figure for the secured loan.

We borrowed £44,000 from First Plus at 12.1 per cent. We also insured the loan which cost £10,500 plus tax in premiums. First Plus calculates that, to settle now, we have to pay £55,500 - which is £11,000 more than borrowed, even though we have never missed a payment and have already repaid £16,000.
DW, Manchester

First plus agreed to look at the settlement again and initially offered to take a partial lump sum repayment from you to reduce your monthly costs. This had the advantage that, if you did not claim on the insurance policy, the horrendous premium would be refunded after five years. Unfortunately, you cannot afford to make any lump sum payment.

Negotiations then stalled while First Plus waited to see your mortgage offer before reviewing the settlement figure. It has finally agreed to knock off £2,500 but you will have to pay for the insurance policy because you have forfeited the cashback. First Plus will hold this offer until you redeem the loan but will not reduce the figure any further because, having seen your income and expenditure plan, it reckons you can afford it. This type of loan is designed to last a fixed number of years so you get bad value by paying it off early.

The cost of repaying your loan early - largely due to the enormous cost of insurance - is horrifying but, sadly, perfectly legal. Not before time the Government is looking at ways to deal with high-cost loans and penalties.

Teacher's tax doesn't add up

My wife has worked as a part-time teacher's assistant since 1991 and never earned more than £6,500. We have just discovered why her net pay always seemed so low, even allowing for her poor wages. Personal allowances had never been granted so her total pay has been subject to income tax.

The Inland Revenue has sent a substantial cheque for the overpaid tax back to 1997/98 but refuses to go back any further. This seems very unfair.
DH, Canterbury

The Inland Revenue refunds overpaid tax for no more than six years, unless you can show that it was the Revenue's error that led to the overpayment. The union, Unison, reckons she should get legal advice because she may have a claim against her employer for unlawful deduction, depending on her precise circumstances. Unison members get free legal help. Otherwise the Citizens Advice Bureau is a good starting point.

What's happened to advice price?

We had a number of Peps and Isas and two pensions set up by RJ Temple of Brighton, which is in liquidation. What has happened to the renewal commission the company was receiving and can we ask for it to be rebated to us?
MB, Eastbourne

If renewal commission does not go to a financial adviser, the insurance company keeps it. It never goes to the client, apart from clients of one adviser, Cavendish, that rebates its share of renewal commission. Your investments have probably been transferred to Temple Financial Planning (TFP), owned by Lighthouse, which bought the Temple name and took on some of its advisers. RJ Temple's liquidator, KPMG, says Lighthouse also bought the future renewal commission trail so TFP is now receiving the money.

If you have had no contact with an adviser since RJ Temple collapsed, contact TFP on 01273 523700. You do not have to stay with that adviser.

Lawyer protests credit snub

In the second week of January, I was turned down for a Nationwide credit card. I am a lawyer, a homeowner and have never defaulted on any bill.

I found my Experian credit reference agency file was out of date although the council said it had upgraded the details on 1 December. I'm perplexed.
MM, London

Although you moved into this house 18 months ago, Experian says you were not included in last year's electoral roll update but confirms that you do appear on the latest register. Local authorities send this to the credit reference agencies at the turn of the year, following the annual autumn canvass. It then takes the agencies some weeks to update their records.

Quite possibly you made your credit card application only days before your name appeared on the register. Anyone moving house can ask the local authority to put their names on the electoral register immediately. You don't have to wait for the annual census.

Peugeot gave me fright of my life

I bought a Peugeot 306 from a local garage, Rawson, and took it there for its first MOT last September. The car passed but the garage refused to sign an MOT because the chassis numbers on the bonnet and boot did not match. Apparently the numbers had been transposed on the production line and the rogue number belonged to another Peugeot 306.

I had to take the car to the DVLA and to the police and could not use the car for nine weeks. The garage arranged for a courtesy car, gave me a free service and front brake pads, but I think Peugeot should compensate me for the trouble and expense caused.
AV, Tunbridge Wells

The garage behaved admirably but Peugeot believes that paying for the courtesy car is enough compensation for the mistake made in its factory.

· Email Margaret Dibben at money.writes@observer.co.uk or write to Margaret Dibben, Money Writes, The Observer, 119 Farringdon Road, London EC1R 3ER and include a telephone number. Do not enclose SAEs or original documents. Letters are selected for publication and we cannot give personal replies. The newspaper accepts no legal responsibility for advice.