Cancellation Question

AndyD4483

Hi all and thanks for taking the time for reading my post I hope someone can advise me.

I am halfway through a 3 year loan with sainsburys bank and have a Single premium policy. Now I am wishing to cancel my PPI as it is extortionate(£50p/m) and will be going down the path of reclaiming the money paid already.

My question lies with the cancellation. I have been advised I will need to write to them in order to cancel my PPI, which is fine and expected. I am wanting to know when writing to them to cancel, should I be informing them that I believe I was mis-sold the policy and will be going down the reclaiming route and maybe request they refund me at that time or should I simply cancel the policy and then seperately start the reclaim process?

Any help will be appreciated

di3004

AndyD4483 wrote: »

Hi all and thanks for taking the time for reading my post I hope someone can advise me.

I am halfway through a 3 year loan with sainsburys bank and have a Single premium policy. Now I am wishing to cancel my PPI as it is extortionate(£50p/m) and will be going down the path of reclaiming the money paid already.

My question lies with the cancellation. I have been advised I will need to write to them in order to cancel my PPI, which is fine and expected. I am wanting to know when writing to them to cancel, should I be informing them that I believe I was mis-sold the policy and will be going down the reclaiming route and maybe request they refund me at that time or should I simply cancel the policy and then seperately start the reclaim process?

Any help will be appreciated

Hello and welcome.;)

You do have a choice here, you can write to cancel in a separate letter to the reclaiming complaint, or keep is together by giving your reasons at the same time.
Either way should be okay.

If you require help, please do post up to ask and meanwhile check this link below for further information, guidelines on reclaiming, and cancelling, you will also come across template letters and a checklist of mis selling reasons, good luck.
http://www.moneysavingexpert.com/reclaim/ppi-loan-insurance

AndyD4483

Thanks, I was just worried that it would cause more problems if I did both at the same time, i think maybe ill cancel and claim at the same time and include both sets of letters with each so i can refer to the letters dated blah...

Thanks

di3004

AndyD4483 wrote: »

Thanks, I was just worried that it would cause more problems if I did both at the same time, i think maybe ill cancel and claim at the same time and include both sets of letters with each so i can refer to the letters dated blah...

Thanks

Your welcome Andy.;)
That will be fine, not to worry and good luck.
Please keep us posted, that would be cool, cheers.:beer:

marshallka

Can I just add that by cancelling this, as this was a single premium, your repayments will not reduce by the £50 a month that you pay towards the PPI. Cancelling usually only gets you a small rebate. Your PPI is actually another loan to pay the premium in a lump sum so would incur interest on it for the full term of the loan. They always forget to tell you this and when they rebate some of it, its only the PPI and not the interest as well. Sometimes its not worth the hassle of this but its entirely up to you.

di3004

marshallka wrote: »

Can I just add that by cancelling this, as this was a single premium, your repayments will not reduce by the £50 a month that you pay towards the PPI. Cancelling usually only gets you a small rebate. Your PPI is actually another loan to pay the premium in a lump sum so would incur interest on it for the full term of the loan. They always forget to tell you this and when they rebate some of it, its only the PPI and not the interest as well. Sometimes its not worth the hassle of this but its entirely up to you.

Cheers for pointing this out Marshallka.;)

marshallka

di3004 wrote: »

Cheers for pointing this out Marshallka.;)

You're welcome Di. I know that whatever you are paying each month towards the PPI is not what the repayments go down by when cancelling.

AndyD4483

So after cancelling I cant expect any reduction in my monthly payments? Or just a small one? After reading my T&C's it says i can get 40% of the premium refunded. Do they then not take that off the balance of the loan and reduce the monthly payment accordingly?

di3004

AndyD4483 wrote: »

So after cancelling I cant expect any reduction in my monthly payments? Or just a small one? After reading my T&C's it says i can get 40% of the premium refunded. Do they then not take that off the balance of the loan and reduce the monthly payment accordingly?

Hi Andy

I'm sure Marshallka will be able to tell you more on how this works, but in general after the cooling period which is normally that of 30 days, unfortunately if cancelled later in that loan, they do not reduce by a big deal, but they do vary depending on what your terms & conds state.;)

For example I was paying then say approx £527 a month, a year after when realised this was mis sold I cancelled the PPI, then the new payments were then approx £514 a month, yet within time their rates risen on the loan and I was paying out more or less the same amount as the first one again.
They are a right rip off, these single policies and if they do not resolve this I'm sure the FOS will.;)

marshallka

AndyD4483 wrote: »

So after cancelling I cant expect any reduction in my monthly payments? Or just a small one? After reading my T&C's it says i can get 40% of the premium refunded. Do they then not take that off the balance of the loan and reduce the monthly payment accordingly?

Its 40% (if that 40% is after paying 3 years) but its usually 40% of the remaining due part of the PPI without the interest it has incurred by now being a loan on top of your original loan. Your PPI has interest just the same as your loan. I would check to see what they say on this one but MOST companies only rebate for the actual PPI remaining due and not the interest as well. This is why they are frowned upon so much.

AndyD4483

Ok thanks for that info, at least I can prepare myself for the lack of a drop in repayment, i will still pursue the refund with the help of the templates :j