Early Settlement Figure - Am I being taken for a ride?

ronnie1956

Hi,

Was wondering if there is anyone who can help with early settlement figures. I have been giving a settlement figure of £15,013.60 with 54 Months left on my secured loan. The figures are below.

I took out a secured Loan for £25,000 with the Halifax in June 2000.

Below is the Figures:
Loan Amount £25,000
Term:180 Months
Monthly Repayments: £288.40 (Including PPI)
Total Account Balance £51, 912.00
Paid to date:£36,338.40
Left to Pay: £15,573.60

Now the figure of £15,013.60 is with a rebate of £430.00 for PPI payments, which leaves with a saving of £130.00 on interest for paying back just under 5 years earlier, is this correct?

The statements that I received still shows payments of £109 per month of my payments, but when I went into the bank and they explained that the loan has been loaded up with insurance at the start of the loan....surely it cannot be that much??!!!:mad:

Using the Rule 78 Method is was expecting the figure to be around the £11,500 to £12,000?

If anyone can offer any help it would much appreciated.

Thanks

Rafter

Ronnie,

You have been the 'victim' of single premium ppi added to your loan up front.

Because your loan is bigger at the start, so the amount of interest and PPI is higher and the amount you are paying off the £25,000 is smaller. In fact you will be paying almost nothing off your loan initially.

Your best outcome will be if you believe the PPI was missold in any way. At any stage did the Halifax imply it was compulsory in order to get the loan? Do you have any pre-existing medical conditions or were you self employed which might make the insurance worthless?

Good luck

R.

JasX

The early repayment reduction will be worked out as per the small print of your original agreement, expect alot of front loading popped in to catch out all the idiots who don't read small print and assume nobody else ever does...

amersall

Take a look here for reasons for mis sell.
http://www.moneysavingexpert.com/reclaim/ppi-loan-insurance
Front loaded ppi is one of the worst, if you believe you were mis sold this product, then put a claim in you can use the template letter off this site, or a letter in your own words will do the same job. Templates are fine,but if your claim goes to fos, then you will have to fill another one in, the choice is yours to the way you put the claim in.All you have to put in a letter is, i believe i was mis sold this ppi because... and give your reasons. Give them 8 weeks to respond and send it recorded.

ronnie1956

Thanks for your response, I can't believe that this down to the PPI! I was employed when I took out the loan, but 8 months later I became self employed, so would I be able to claim?

I know one thing I was definitely not told about the payments for the PPI being loaded upfront, even on my statements, it shows Insurance payments £27.11 and that has shown the same amount for the last 10 years! So The insurance payment has not been £27.11?

DappaOne

Is adding 58 days interest to an early loan payment legal?

Halifax told me that the interest on my loan was basically paid at the start of the loan and now the balance is being paid off - if that's the case how can they justify adding 58 days interest to my loan?? Sounds extremely sketchy to me!

paddyrg

DappaOne wrote: »

Is adding 58 days interest to an early loan payment legal?

Halifax told me that the interest on my loan was basically paid at the start of the loan and now the balance is being paid off - if that's the case how can they justify adding 58 days interest to my loan?? Sounds extremely sketchy to me!

Yes. It's not *all* the interest paid upfront, but a larger proportion of the loan amount is interest earlier on when the principal is high, and as you niggle away at the principal, the payments pay more principal and less interest (as there is less interest on the reduced principal).

http://www.sitewidgets.com/calculator_l_withgraph.phtml?unroundedPayment=46.25275790861668&loanAmount=3500&helpHelp=Click+on+%22%3F%22+to+get+help+on+that+item.&nrOfYears=15&interestRate=10&monthlyPayment=46.25&showAmort=Show%2FRecalculate+Amortization+Table+and+Graph

Copy and paste (or click) that link, it draws a little graph for you showing how much of each payment is principal, how much interest, it'll illustrate the idea :-)

opinions4u

Rafter wrote: »

Ronnie,

You have been the 'victim' of single premium ppi added to your loan up front.

Because your loan is bigger at the start, so the amount of interest and PPI is higher and the amount you are paying off the £25,000 is smaller. In fact you will be paying almost nothing off your loan initially.

Your best outcome will be if you believe the PPI was missold in any way. At any stage did the Halifax imply it was compulsory in order to get the loan? Do you have any pre-existing medical conditions or were you self employed which might make the insurance worthless?

Good luck
R.

Halifax secured loans didn't do lump sum ppi. It was always a monthly premium.