cant cancel ppi on natwest loan

dumb_blonde

Hi,I have a single premium policy on loan.Cant afford the loan let alone the ppi,so i thought i would cancel it to reduce the payments(even tho cant afford them)
I have recieved a letter saying that as i have had a successful claim on this policy in the past,i cannot get any refund of insurance premiums resulting from the cancellation.
They are saying that even if i cancel it,the monthly payment will not reduce.
Is this right?
Thanks for your time.

mangle101

Check this out dumb blonde - Until Jan 2010 it had been generally assumed you could not make a misselling complaint if you've already made a successful insurance claim because that would indicate the policy was suitable. Yet proposals from the regulator now mean more people could be entitled to compensation.

Anyone who has claimed on a PPI policy can still submit a misselling complaint, though the chances of success are unclear. However even if you're not successful you may be able to cancel your insurance.

This can be found in the 'Reclaiming PPI' section.

Good Luck!

dec22

Mangle is correct and I have read of successful claims on the the forums somewhere but they have been through the FOS.

Although the policy was suitable were you given any choice/told it was optional when it was sold to you? Was the full cost disclosed to you? Did you know that it attracted interest? More often then not, the cost of PPI outweighs the benefit. Worth working out how much the PPI cost is plus interest less the value of the, payments made in your recent claim. If you win a case for misselling, then Natwest would have to refund payments made less the value of the claim.

Have a read through the notes at the beginning of the forum to decide whether you do have a claim or not.

Good luck!!

magpiecottage

The FSA is still sorting out how this should be done but generally the fact that you have claimed does not mean your policy was not missold.

It doesn't mean it was either but if it was then the value of the claim will be deducted from any redress.

janeybaby13

Hi dumb blonde!

We had the same problem on a HSBC loan which is still active. However HSBC said we could cancel the PPI but when they recalculated the loan it went down from 285 to 282! 3 pounds less! So therefore he kept it on. Apparantly you pay your PPI and interest at the start of your payments and because you pay that at the start of the loan it wont decrease the loan! This may be why yours wont be any cheaper!

Jane

dumb_blonde

hi,thanks for the replies,
I wasnt trying to claim for missold,I just wanted to cancel the policy in the hope that the monthly payments went down.So it looks like i wont be able to save on this one.Thanks anyway:)

magpiecottage

janeybaby13 wrote: »

Hi dumb blonde!

We had the same problem on a HSBC loan which is still active. However HSBC said we could cancel the PPI but when they recalculated the loan it went down from 285 to 282! 3 pounds less! So therefore he kept it on. Apparantly you pay your PPI and interest at the start of your payments and because you pay that at the start of the loan it wont decrease the loan! This may be why yours wont be any cheaper!

Jane

That sounds unlikely to me. What is more likely is that they have simply worked out a refund on the unexpired portion of the money.

Normally the premium for the policy is added to the loan and interest charged until it is repaid. I cannot see how it would work otherwise.

In any case, if all the interest was charged up front it would mean they were charging it over the full term of the loan.

You should both be complaining.