Payment Protection Rip Off!!!!

pembsbexy

In an attempt to lower my monthly outgoings - credit card payments crippling me - I have taken out a bank loan. I asked for two quotes. Loan is for £20k over 7 years - yes i am appalling with money - and i had the shock of my life with the difference in quotes - one with their payment protection - one without. £377 with - £300 without - although they did insist I had life insurance for the loan (only costing £6 pm) £77 per month for payment protection. Though this website I contacted an insurer and got anoter quote for the repayments. £7.50 per month for the same amount!!!! UNBELIEVABLE!! let this be a warning to people - don't take out payment protection from the loan provider. also don't believe them when they suggest your loan application will be denied if you don't take out their protection - this is a fib and I think it's illegal - can someone put my right on that???
Now, hopefully with the lower outgoings I can afford to pay off my other debts!!!! ARRGGG!!!!!

PS - Martin Lewis looks very much like my ex husband - nothing like him where money is concerned tho, ex had four CCJ's and a court appearance I didn't even know about .... https://www.quickdivorce.co.uk sorted that problem out!!

lhayden81

I took out a loan with the payment protection, as like you i was told they wouldn't grant the loan without the protection, then last month (12months after the loan started) I was made redundant and because the job centre has refused to sign my insurance form until they know if I'm entitled to job seekers allowance, the bank will not pay the loan? Can they do this do you know?

going2die_rich

I don't know how the insurance in regards to your life works for unsecured loans, as in whether you can get the insurance else where or not. But if you can, go else where, I think if you shop around £6 a month will be pretty steep to protect £20k.

I have life insurance which is more than 20 times your £20k amount and thats only like £32 a month. I am 23 so maybe have a lower premium than yourself, but unless you are very old I'd think for £6 a month you should be able to get more insurance than £20k if you were to die. I'd say around the £100k mark for £6 a month.

I am with legal and general by the way if you want to try a quote with them. But their are loads of life insurance companies out there, and some appear on cashback sites like rpoints and quidco, so I'd strongly suggest doing some of the quotes online before signing off the £6 a month insurance.

If the worst was to happen you might as well leave your family with the extra £80k+ after your loans been paid off. If you don't intend on having life insurance after the loan has been paid back, just go for the shortest term of policy available as these are normally the cheapest. It's normally around 10 years so just cancel the policy once the loans paid.

Hope this helps,

going2die_rich

lhayden81 wrote:

I took out a loan with the payment protection, as like you i was told they wouldn't grant the loan without the protection, then last month (12months after the loan started) I was made redundant and because the job centre has refused to sign my insurance form until they know if I'm entitled to job seekers allowance, the bank will not pay the loan? Can they do this do you know?

Why would the bank care if you recieve JSA or not?

All you need is to prove you have been made redundant and not just left your job. I am sure your employer would have given you a letter confirming your redundancy which you can show to your bank. Ensure it's only a copy though as banks always lose things.

I'd chase the bank up saying whether you are entitled to JSA or not has no relevance, you can prove you were made involuntarily redundant therefore expect the PPI to apply.

The only reason I can think of why the bank would want to know if you get a claim from JSA, is if they want to force you to pay a small amount towards the repayments. Check the terms and conditions if this is the case as it would be very underhand, but make good business sense to force people back to work to pay off the loan.

ste1_2

hi ya, can you tell us the name of the company that you used to get the £7.00 payment protection insurance please.

thank you.
ste

Voyager2002

lhayden81 wrote:

I took out a loan with the payment protection, as like you i was told they wouldn't grant the loan without the protection, then last month (12months after the loan started) I was made redundant and because the job centre has refused to sign my insurance form until they know if I'm entitled to job seekers allowance, the bank will not pay the loan? Can they do this do you know?

Sorry to hear about your redundancy.

Check your PPI agreement carefully. When I have seen one, they have defined unemployed as meaning that you receive JSA, so if that applies to your agreement then the insurance company is acting legally. But in any case, you should receive JSA pretty soon. I suggest you read the Benefits bit of this site to learn how you can speed up the process of getting it, and of course that will unlock your insurance as well.

Vickicb

I took a loan for £25K once and was told that with Life Insurance it was £434 and without it was £304 - huge difference. I got life insurance from Legal & General for £7 per month. Apparently once they have issued the offer for the loan they cannot refuse the application if you simply ask to use another company for Life Insurance.

fran_from_willesden

I'm about to get a graduate loan to pay off my Career Development Loan and Credit Card and to put the rest in an ISA..about 10k in total. My repayments would be over £250 a month with PPI but a shade under £200 without...this is a huge difference to me! Like others, my graduate advisor suggested I take out life cover instead at approximately £10 a month. Makes more sense really.

regularsaver1

fran - life cover does not cover your monthly payments in the event of an accident or sickness - so have a think if you need these things then have a look around

POSSETTE

my loan a few years ago was 25k..payment of 271 a month..N.Rock wanted £90 a month PPI...HAHA ..i said No 4 times and they backed off....i came on this site and found Pinnacle Insurance they did cover of £280 for life/accident at £7.51 a month...SOLD!