PPI Reclaiming discussion Part III

marshallka

maxdp wrote: »

Marshallka replied.x

And pm'd ya back again. God it will all be PM's on here soon. If anything we help the FOS and FSA with our posts and we are all mostly complaining about the same thing...

Calculator

Morning all

Just let me know if you need any more "Queen" links relax to --

Turbo

marshallka

This is what I am complaining about but cannot get anywhere complaining about its use in my settlement of the loan but it is an unfair term on the actual insurance..

A bit of reading here


The rule of 78 is little understood outside banking circles, even though it is commonly applied to many consumer and business loans. In essence, it increases the amount a borrower has to pay on early redemption.
The calculations involved are complex, but concern the way monthly apportionments are made (apparently, you sum the number of payments in inverse order as a numerator for the fraction in which the sum of the term is the denominator).

The rule of 78 has long been regarded as unfair by consumer organisations, and the OFT has described it as ‘unfair and oppressive’. It has been outlawed in respect of consumer credit loans since May 2005 but it can still apply in the case of unregulated loans. There does, however, have to be a term in the loan agreement whereby the borrower agrees to the use of the rule of 78 on an early redemption.

Importantly, we now have a reported case in which the High Court has decided that such an agreement fell foul of the Unfair Terms in Consumer Contracts Regs 1999, and was thus void. In that particular case, the loan had been for £105,000, but when the borrower wanted to redeem the mortgage 18 months later, the rule of 78 calculation gave the lender a windfall of £34,000. But, that £34,000 charge has now been held to be unlawful.


This is what the rule of 78 does when calculating a rebate of the PPI. It gives the lender/insurer a windfall and is unfair to the consumer.

marshallka

Calculator wrote: »

Morning all

Just let me know if you need any more "Queen" links relax to --

Turbo

Morning turbo.

maxdp

Calculator wrote: »

Morning all

Just let me know if you need any more "Queen" links relax to --

Turbo

Hi Turbo

How you this morning;)

maxdp

Marshallka

Was not aware of the second part of that. I miss the thread when I have been working away. No wonder you steaming.:eek: I would be too. That is inconsiderate.:D

Anne42

marshallka wrote: »

No as they would not be treating you fairly is the blunt answer and if they do that then you would be able to complain to the FSA

Hi

this is a very useful comment. What id they do not accept the claim? Will the payment just carry on as normal (with no chnage to the agreement whatsoever) or can Lloyds TSB turn around and cancel the agreement?

marshallka

RUle of 78 used in rebates of single premiums is unfair.


"Companies that have used the rule of 78 method to calculate rebates on single-premium policies. Companies Say that the rule recognized the way in which insurance risk and expenses were incurred over the lifetime of the policy up to termination. Because the outstanding loan amount is large at the beginning of the loan and small towards the end, and due to the upfront nature of expenses, for example selling costs and placing the policy on risk, the risk being covered by the insurance per unit of time is higher at the beginning of the policy than it is at the end. They say that the rule of 78 reflected this pattern. The competion commission accepted this argument as being valid for policies where a condition can be covered for the life of the loan (for example, most providers offer insurance in the event of accident or sickness for the duration of the event, up to the life of the loan or five years, whichever is shorter). However, it could be contended that the argument is only partially valid in circumstances where insurance is paid for for up to 12 months (for example, in the case of most unemployment claims); in this case the level of risk borne by the insurer is the same until the last year of the policy, when the risk decreases because there is less than a year left to insure.


This is my argument here;)


http://www.competition-commission.org.uk/inquiries/ref2007/ppi/pdf/prov_find_app_5_2.pdf

Calculator

Morning

I'm finding it really hard to follow continuity on here of particular cases---if I miss a day--I'm lost

Lots of cases in here all running merged together, lots in the Successes thread & some on individual threads.

I'm from PCF & PAG(Mod) in the main and also keep up to date on LB & CCS & CAG & BritishConsumer

All have individual threads for each claim--why does't MSE.?

PS--for Queen lovers I have a "Queen Sanctuary" in these 3 places--lol---

http://www.penaltychargesforum.co.uk/showthread.php?t=44351
http://www.legalbeagles.info/forums/showthread.php?t=6695
http://www.penaltyactiongroup.co.uk/forum/viewtopic.php?f=243&t=1478

we are having a temporary glitch for some IE users on the last link (PAG)

Turbo

marshallka

Anne42 wrote: »

Hi

this is a very useful comment. What id they do not accept the claim? Will the payment just carry on as normal (with no chnage to the agreement whatsoever) or can Lloyds TSB turn around and cancel the agreement?

This may be useful to you. I would say that if they did not offer the loan again at the same APR and terms then this is not treating you fair

http://www.fsa.gov.uk/pages/Library/Communication/PR/2007/043.shtml

They will not cancel the agreement if you do not win as again they would need a good cause for doing this.