Is anyone with payplan? Please read on..

hollyivy12

My partner ran in to financial difficulty in 2007 and was referred to Payplan by his bank at the time Lloyds TSB. He agreed to pay £600 each month directly to Payplan who would then distribute the money to the creditors. They also advised him to join their Cover My Payments Scheme which would be a small percentage per thousand, but at the time because he was in such a state with worry and stress he would have agreed to anything if someone could help sort his situation out and get Lloyds off his back. They never at any point asked him about any insurance policy’s he had in place at the time.

Some months later he started getting letters from a few of his creditors stating charges were being added onto his account for late payments. When he contacted Payplan he realised that they did not always pay on time and so he started checking his account on their website Justabank. Up until this point he had naively completely trusted them to manage his debts. He is not very good with finances so I had a look at his account and noticed that out of the £600 he was paying them monthly that only £570 was going to the creditors, so the other £30 was paying for this scheme as they call it. Basically the scheme is to cover the payments made to the creditors if you come out of work or are sick like a PPI, so as far as I can see is also a type of insurance although they state that it is not. By this time he had paid £600 into the scheme which could have paid off two of his debts, so I told him to cancel it immediately as having three payment protections on his two loans and credit card, life insurance and pensions in place he definitely did not need it.

Since all the information has come to light about the mis-sold payment protections and the antics of the banks he has applied for a couple of PPI refunds including the £600 he paid to Payplans ‘Cover My Payment Scheme’. As expected Payplan knocked it back sticking to the ‘it’s not an insurance policy’ excuse so he forwarded all the details on to the Financial Ombudsman. The ombudsman replied last week stating that the policy is not an insurance so is not regulated by the FSA, so they will not force Payplan to refund his money. He intends to appeal the decision as its obvious there is something not right about this whole situation or is it a loop hole or the fact Payplan are in cahoot with the bank?

Firstly the fact that Lloyds advised him to go to Payplan in the first place should raise an eyebrow. If he did stop working while he was still paying into the Payplan scheme, then the scheme would continue paying his payments to the creditors and then the bank would not have to under the PPI policy’s he already had in place. In a nutshell he was basically paying for the same service twice does this not seem dodgy in its self? What is appalling about the whole situation is that Payplan are supposed to be helping people in terrible financial difficulty, but are for this reason in fact worse than the banks! This scheme would obviously benefit a person who had no insurance policies in place but obviously not in my partner’s case, therefore it was defiantly mis-sold to him. He certainly could not afford it on top of all the debt he was in but this was not taken into consideration either. Unbelievable! On the Payplan website it says protect you payments by joining their ‘Cover My Payments Scheme’ – this is not an insurance policy – then what is it doing? Then they have house insurance called ‘Cover My House Scheme’ also car insurance called ‘Cover My Car Scheme’. Is it me or is this not fishy?

I would be interested to hear if anyone else is in a similar position with Payplan. Surely someone else has noticed that they are ripping people off like the banks? I would like to know what’s going on and why they are getting away with it or what can be done about it if anything?

Diane :mad:

di3004

Hi Diane

Blimey so sorry to hear this!

It must be so frustrating for you both.

Maybe you could contact another free debt organisation and see what they can do, what about National debtline?
http://www.nationaldebtline.co.uk/england_wales/contact_us.php

You could try posting about this actual matter on the debtfreewannabe thread and see what others suggest, as many are in the same situation on here and I'm sure they will be able to advise.
http://forums.moneysavingexpert.com/forumdisplay.php?f=76

But in regards of the mis selling of PPI via banks (I assume you also mean he was mis sold by the bank for this as well)?
You would have to pursue the bank about this on the reclaiming side of it, if your partner is still paying for the bank loan insurance whilst in a prepayment plan its actually quite worthless to him at this point.

I would if you have not done so yet, complete the reclaiming questionnaire, you can write a cover letter if you want to as well (optional), remember to keep copies of all you send and receive, in case you need to refer to this at some point, send the completed questionnaire to the ones who set the policy up in the first place (head office), they normally have 8 weeks to give a decision.
Reclaiming questionnaire here:
http://www.moneysavingexpert.com/reclaim/ppi-loan-insurance#reclaim

But in regards of the payplan matter if you've not done so yet, please do post on the 2nd link I posted above for more help and advice, good luck and keep at them.;)

Edited to give you address via Lloyds complaints - PPI

Lloyds PPI
Customer Care
Lloyds TSB Insurance
Tredegar Park
Newport
South Wales
NP10 8SB

hollyivy12

Thanks Di for your reply but if you read again its about what Payplan are up to not the bank. Its just a bit complicated to understand it took me long enough! im just hoping someone else has cottoned on to this situation and has a solution to what can be done.

marshallka

They seem to set up insurance

http://www.totemic.co.uk/

Suziev1

I too am with payplan and have looked at my account this morning and see that I too am paying a premium for Cover my Payment. I also seem to have a payment going out for cover my life.
With regards to the earlier post about going to National Debtline, it was in fact National Debtline that forwarded my case to payplan.

I have also had problems with payplan not forwarding my payments on time which has resulted in me getting a late payment entry on my credit report.:eek:

hollyivy12

Hello, did you agree to join the cover my payments and cover my life plans?

Suziev1

I don't think I did for Cover my Payments

hollyivy12

Hello,

be really careful with Payplan, if you do not have life cover or any type of insurance the cover my payments could be usueful but in our case it was definately miss-sold as my partner already had ppi's in place on his accounts. Once i realised this i got him to cancel immediately but they will not give him the £600 back. Make sure you need the cover otherwise i would cancel. I have gone to the FOS and Payplan are not members of the FSA as they say its not an insurance - but it obviously is and i cannot see how they are getting away with it. But for this reason the FOS wont force them to pay up. Keep an eye on your accounts as i know they told us nothing and we found out the hard way that payments were not being paid on time etc. We have left them now and are paying direct to the creditors which is all they do anyway. These creditors that harrass you cannot take what you have not got but its took us a long time to see how it all works. I hope you have sorted your situation out ok now but just be very careful with Payplan as they are obviously selling products like the banks and i am not convinced they act in our best interest.

Diane

lyndhurst

hi there,
I was advised to go to Payplan by Lloyds TSB when I was having problems. I paid them £106 per month which was spread between my creditors. I had no problem with most of them but Lloyds Tsb kept calling me and sending me letters and Payplan said that they had the right to do that.
I recieved a letter one day from the bank saying they were charging me 0ver £200 for exceding my overdrat limit, the overdraft being what I owed them. I couldn't understand this as I paid Payplan to pay them. What it turned out was that Payplan was paying 1p per month short of the agreed amount. When I asked Payplan how this happened I was told that "the computer sometimes did that". I asked how a computer could pay less than it was instructed by a person. I never got an answer to that. They never accepted responsibility for the added charges and after it happening again I stopped paying them sold my house and paid off my debts myself including the mortgage. My son was furious but I felt better being debt free.
I would say stay away from Payplan and Lloyds TSB. Maybe you were right, maybe they are in cahoots with the banks, LLoyds TSB at least.
i did post about this before but haven't been on for ages.

bluesmurf_2

I didnt have any luck with Payplan either but this was because I am self-employed. They referred me to someone else who wanted fees out of my monthly payments!
Probably a bit of this goes back to Payplan, who knows????

Decided to do things on my own and been working 6 days a week this year and so far reduced my debts by £8000 since this time last year!!:j.

Only £30k to go:( but I will get there:xmassmile.

hollyivy12

Hello,

so when you say they refered you to somebody else do you mean to another department to take out an insurance on your payments? I think all Payplan do is set up direct debits for people to their creditors, as the creditors if they will stop charges and interest which they mostly will not do and if they sell you a few insurances thats a bonus for them. Virtually every quote they give to people to pay off the depts you can double it! You are right to go it alone as they did nothing for my partner either and he is doing fine now. We are not giving up yet though, the Cover My Payments is definately a form of insurance NOT just a scheme so if we can find out who the underwriter is and its not Payplan then hopefully they wont have a leg to stand on!