How do you know if the PPI premium refund was fair or not?

simonla

Hi there, I am new to this site and I am looking for someone to help me or point me in the right direction.

I cancelled the PPI on a loan I took out in January 2006 and was told I had to start a new loan in order for the PPI to be removed.

The figures from the original loan agreement are as follows:

Principal Loan

Amount of loan - £20700
Period – 96 Months
Interest rate – 6.9%
Charge for credit - £6088.71
Amount payable - £26788.71
First payment - £278.96
95 further payments - £279.05

PPI Plan Loan (single premium repayment protection)

Amount of loan - £6230
Period – 96 Months
Interest rate – 6.9%
Charge for credit - £1832.51
Amount payable - £8062.51
First payment - £84.41
95 further payments - £83.98

Total Loan

Amount of loan - £26930
Period – 96 Months
Interest rate – 6.9%
Charge for credit - £7921.22
Amount payable - £34851.22
First payment - £363.37
95 further payments - £363.03

I cancelled the PPI in June 2008 after 29 payments had been made and the redemption breakdown, which at the time I didn’t even think to question, they gave me was as follows:

Redemption figure details

Balance- £24323.01 DR
Interest refund to close - £3815.38 CR
Amount to close loan today - £20507.63 DR

Loan protection details

Amount of premium refund - £2962.81 CR
Amount to close loan after premium refund - £17544.82 DR

New loan was taken out June 2008 at £17550.

I have been onto Guardian.co.uk’s website and checked out their Loan Payment Calculator so I think I know where the original redemption figure £20507.63 comes from, I don’t agree with it but I understand how they got to that figure. The thing that is troubling me is how they got to the figure of £2962.81 as a refund for PPI.

Any help that anybody can give me would me greatly appreciated.

Kind regards,

Simon

di3004

Hi Simon and welcome.

Someone will come and check these out for you soon.

And if mis sold the ppi for any reason, give it a go on the reclaiming.
http://www.moneysavingexpert.com/reclaim/ppi-loan-insurance

If you think on settlement you did not have a fair amount rebate, I understand that people have made complaints about that as well.;)

robbedofmymoney

simonla wrote: »

Hi there, I am new to this site and I am looking for someone to help me or point me in the right direction.

I cancelled the PPI on a loan I took out in January 2006 and was told I had to start a new loan in order for the PPI to be removed.

The figures from the original loan agreement are as follows:

Principal Loan

Amount of loan - £20700
Period – 96 Months
Interest rate – 6.9%
Charge for credit - £6088.71
Amount payable - £26788.71
First payment - £278.96
95 further payments - £279.05

PPI Plan Loan (single premium repayment protection)

Amount of loan - £6230
Period – 96 Months
Interest rate – 6.9%
Charge for credit - £1832.51
Amount payable - £8062.51
First payment - £84.41
95 further payments - £83.98

Total Loan

Amount of loan - £26930
Period – 96 Months
Interest rate – 6.9%
Charge for credit - £7921.22
Amount payable - £34851.22
First payment - £363.37
95 further payments - £363.03

I cancelled the PPI in June 2008 after 29 payments had been made and the redemption breakdown, which at the time I didn’t even think to question, they gave me was as follows:

Redemption figure details

Balance- £24323.01 DR
Interest refund to close - £3815.38 CR
Amount to close loan today - £20507.63 DR

Loan protection details

Amount of premium refund - £2962.81 CR
Amount to close loan after premium refund - £17544.82 DR

New loan was taken out June 2008 at £17550.

I have been onto Guardian.co.uk’s website and checked out their Loan Payment Calculator so I think I know where the original redemption figure £20507.63 comes from, I don’t agree with it but I understand how they got to that figure. The thing that is troubling me is how they got to the figure of £2962.81 as a refund for PPI.

Any help that anybody can give me would me greatly appreciated.

Kind regards,

Simon

the ppi refund is normally a percentage of the original premium, this percentage starts at only 60% in the first year, 50% in the second year and then down to 20 and 10% in year three and four.

this percentage varies dependant upon the term of the loan, there should have been an explanation of this when you took out the loan for the ppi premium.

in terms of a refund on the remaining ppi you would be entitled to 29 x £83.98 = £2,435.42 + the additional 43p from the first premium

£2,435.42, this figure includes an element of interest to the tune of £19.08 per month (29 x 19.08 = £553.32)

you would be entitled to 8% simple interest on the amounts you paid, this totals an additional £649 (approx)

then you would be entitled ot the difference in ppi paid (without interest) and the ppi rebate

so premiums paid excluding interest is 2435 - 553 = £1,882

so by starting with the initial premium you will get

6230 - 1882 - 2962 (rebate) = £1386 + 8% simple interest = £240


so the full refund if you win would be

2435 + 649 = £3084 for your premiums paid, and
1386 + 240 = £1626 for the difference in settlement if the ppi was not on the loan.

it will be a nice refund if you win a miss-sale of the policy.
good luck and let us know how you get on,
if you need any further help please shout.

cheers

robbedofmymoney

di3004 wrote: »

Hi Simon and welcome.

Someone will come and check these out for you soon.

And if mis sold the ppi for any reason, give it a go on the reclaiming.
http://www.moneysavingexpert.com/reclaim/ppi-loan-insurance

If you think on settlement you did not have a fair amount rebate, I understand that people have made complaints about that as well.;)

blimey Di, i nearly beat you again, you just pipped me.:D

di3004

robbedofmymoney wrote: »

blimey Di, i nearly beat you again, you just pipped me.:D

LOL :rotfl::rotfl::p:DX

simonla

Many thanks for your responses.

Would I have a case for claiming? I posted this same post on another forum and somebody has replied saying it's not worth claiming don't bother.

I wasn't given any information regarding the PPI and paying back early when I took out the loan, and I have stupidly took several loans out with HSBC that have consolidated other loans in the past 10 years.:(

I am ready to cut all ties with HSBC as they are a real pain to deal with and if you suggest I pursue this and win it will make me the happiest guy on the planet!! :T

Kind regards,

Simon

di3004

simonla wrote: »

Many thanks for your responses.

Would I have a case for claiming? I posted this same post on another forum and somebody has replied saying it's not worth claiming don't bother.

I wasn't given any information regarding the PPI and paying back early when I took out the loan, and I have stupidly took several loans out with HSBC that have consolidated other loans in the past 10 years.:(

I am ready to cut all ties with HSBC as they are a real pain to deal with and if you suggest I pursue this and win it will make me the happiest guy on the planet!! :T

Kind regards,

Simon

Simon

Its possible, but check the checklist on the loan insurance link I posted in my above post, if they automatically added the ppi without your knowledge, and you might have assumed it was all part of the loan, then that is a reason, but do check the list anyway in case any other apply to you.
Good luck.;)

amersall

simonla wrote: »

Many thanks for your responses.

Would I have a case for claiming? I posted this same post on another forum and somebody has replied saying it's not worth claiming don't bother.

I wasn't given any information regarding the PPI and paying back early when I took out the loan, and I have stupidly took several loans out with HSBC that have consolidated other loans in the past 10 years.:(

I am ready to cut all ties with HSBC as they are a real pain to deal with and if you suggest I pursue this and win it will make me the happiest guy on the planet!! :T

Kind regards,

Simon[/QUOTE
Hi there simon, yes you have a case for reclaiming, what site did you go on and you were told not to bother? If you have more than one loan with these claim for all of them as if they were rolled over you would be entitled to ppi on each.(less any rebates given) you will get all the help you need on this site, you go for it and good luck x

amersall

Hi jack flash :A you havent lost your touch yet then :cool: i am still waiting for you to post a reply before someone has even asked a question :eek: now that would be :cool::cool::cool:

di3004

amersall wrote: »

Hi jack flash :A you havent lost your touch yet then :cool: i am still waiting for you to post a reply before someone has even asked a question :eek: now that would be :cool::cool::cool:

LOL........:D:rotfl::rotfl::rotfl:.

I am turning psychic now as well LMAO.........:rotfl: I wish.:D:AXXX

simonla

[/QUOTE
Hi there simon, yes you have a case for reclaiming, what site did you go on and you were told not to bother?[/QUOTE]

Hi

The site was consumeractiongroup.co.uk and the person (DJ1971) said


Simon,

It looks like it would be difficult to challenge the amount of refund they have given you.

Reason being, they will claim to charge more interest at the start of the loan as the risks are higher. So although you are paying £83.93 per month against the PPI loan, in the early days perhaps only 33.93 of that repayment amount is coming off the outstanding balance and the remainder is interest. Then further down the line with each monthly repayment, you are paying less and less interest and more of your repayment is being used to reduce the outstanding balance.

Do not think this is very fair, but apparently it is normal practice and widely accepted.

So I suspect there is little point in challenging the amount of rebate you have received.

DJ

I think I will send HSBC a letter and see what they say.

Kind regards,

Simon