bank loan and redundancy

sharon_ann_2

Being made redundant and receiving 4000.00, have a loan with my bank rang them up to explain and claim on my PPI sending forms to me. But someone said they can take my redundancy payment to help pay off the loan HELP

fozmcfc

You could well be ok, it depends what restrictions the PPI has.

There are so many things that can exclude people being able to use PPI benefits they have on their loans. Common ones such as if you get the sack or if you didn't declare an illness you had.

There may be restrictions such as if you receive so much redundancy pay you won't be entitled to use the PPI, or you still have to pay half.

As I say you could be fine and hopefully others with more knowledge will be along to comment. At the end of the day, I think you will only know once they have received your PPI forms back.

You could post your post on the redundancy part of the forums as well. I'm sure others have been in your situation.

It may also help if you post more info about the circumstances of your redundancy, have you voluntarily taken it, how long have you been in job etc...

http://forums.moneysavingexpert.com/forumdisplay.php?f=165

sharon_ann_2

Thanks for the reply .... have been in my job for 10 years only getting stat redundancy money so its only about £4000, was made redundant, not voluntary.

selecta_c

The bank cant just take your redundancy payment out of your account to pay off your loan.

First you would have to default on the loan,so providing you are lucky enough to find another job and carry on paying off your loan payments as normal your redundancy payment will be safe.

JuicyJesus

selecta_c wrote: »

The bank cant just take your redundancy payment out of your account to pay off your loan.

They can. They have the right of offset against any funds for any reason. Whether they will is another matter. They will typically only do so if there is no contact from the person concerned (or they're uncooperative), or after a certain number of missed payments.

If you are in contact with them to claim on the PPI (which is, after all, for this specific circumstance) it is doubtful the bank would do so. But it is worth confirming with the bank.

opinions4u

The insurance may have a period of time from end of employment before it kicks in, typically 30 days.

If your employment is terminated, and they pay you in lieu of notice, the insurer will probably view the end of the legal notice period as the date your employment ends and the date their exclusion period commences.

The tax free redundancy payment shouldn't impact your insurance claim, but you are still responsible for making payments until the insurance kicks in.

geoffky

They can just take it and if you have other accounts they can take from them as well .be careful

[Deleted User]

geoffky wrote: »

They can just take it and if you have other accounts they can take from them as well .be careful

only if the OP defaults !

pvt

Sharon,

If they won't pay out, and it's because of a stat redundancy payment, then I would suggest you have one of the clearest PPI mis-selling claims there could ever be.

pvt

Emmzi

have you defaulted on your loan yet?

If you haven't they can't offset (but they could against an overdraft)

So when you get the payment, transfer the cash to a non-related bank.

Butti

Emmzi wrote: »

have you defaulted on your loan yet?

If you haven't they can't offset (but they could against an overdraft)

So when you get the payment, transfer the cash to a non-related bank.

This is possibly one of the best bits of advice you have got. You will be told when the redundancy payment will go in (mine went in 2 days before I finished - they like to keep things tidy).

Set up a savings account in an unrelated bank (make sure they are not linked) and move it on the day you get it. I would set it up as a payee so you can just move it that morning on the computer or on their one in branch. I did this at 7.30am on the day it was paid - but hey I am a little paranoid!

They can only access YOUR money if it is one of their accounts.

B