My HSBC Personal Loan - Some Guidance Needed

YV01

Hi everyone,

I took out a loan with HSBC back in October 2007 to pay off student debts -overdraft, credit card etc. I was looking over my agreement this morning and decided that I should cancel the Protection Plan: 1) As I don't feel I'm gonna need to use it; 2) I've heard a lot of bad reports from people who have lost their jobs etc. only to find out that the bank will not honour the Protection Plan; and 3) It is adding £1,071 to the amount I have to pay back. I know now that I should not have taken the Protection Plan form from the beginning, but I was made to believe at the time that I had no choice but to take it. I am currently paying £93.93 evey month towards the loan.

I phoned HSBC this morning to be met with a very friendly member of staff. This surprised me as it is the first time in 8 years that this has happened. I explained that I wanted to cancel the Protection Plan as my agreement said it was optional. I was told this was no problem and was put on hold while they worked out my new payments. I really thought this was great as I was going to save myself some money.

When the Advisor came back she told me that if I cancelled the Protection Plan my repayments would go from £93.93 a month to £117 a month - nearly £25 a month more than what I'm paying. She came off with some waffle about what I've paid so far has just been interest and not capital so by cancelling the Protection Plan I have to start paying interst again.

Please please can someone advise me. Can the bank do this? I've had nothing but problems with HSBC from the day I joined, with bank charges etc. I thought today maybe something would work in my favour, but this is ridiculous.

Rafter

If you you were 'made to believe' that the insurance was compulsory you have a misselling claim. Download the letters of this site, sent them off and wait for a big cheque hopefully.

You should also then get the interest rate on your loan honoured - it looks like HSBC are increasing your interest rate using the fact that you are now higher risk or that loan rates have gone up.

Good luck

R.

YV01

Thanks Rafter,

Does that mean there is no way the payments should increase if I cancel the Protection Plan? Its just when I'm on the phone to them and they go on about interest and capital I get lost

rockyroad_2

I cancelled my PPI with Blackhorse today, was paying 133 a month and without it it should b3 94,for some reason they say payments will be 117 and kept me on hold for 15 min I think on purpose, they were very unpleasant and kept trying to tell me why I needed the PPI. I did not want it at time of applying for loan but was told it was only way I would get accepted for it. I have been paying this loan since Sep 2008 so I have paid a fair bit out on PPI and grudge it now.

YV01

I can't believe they get away with these things. How can cancelling something that costs £1,000 cost you extra???