Not sure if I was missold PPI

vyle

When I bought my flat in 2009, I got it pretty much as the market bottomed out (got it for just over half of the original price). As a result, Persimmon insisted that I buy my mortgage through their approved broker, Choice Mortgages.

I did so, but as the mortgage was so small, Choice told me that I had to also get PPI for life and employment cover as they weren't getting enough kickback on the mortgage.

Now, as far as I understand, if PPI is part of the terms of sale, that's okay, but if it's used as a way of pretending rates will be lower, it's not? So I'm not sure what to do, or even how to cancel my PPI as it is.

dunstonh

Now, as far as I understand, if PPI is part of the terms of sale, that's okay, but if it's used as a way of pretending rates will be lower, it's not?

More or less right. However, that isn't what happened to you. The broker said your mortgage was too small to pay their fees so an insurance policy was required to cover it (they probably documented it as a choice of insurance policy or fee).

So I'm not sure what to do, or even how to cancel my PPI as it is.

Do you have any evidence that you were forced to have it? The broker won't and they will say you chose to have it. They will have a factfind and needs analysis and a statement of demands and needs.

vyle

That's what I thought. If they recorded the calls, they'd be able to track down the conversation where the rep said something along the lines of, "We'll need you to take insurance, too because the kickback off such a small mortgage isn't enough," to which I (perhaps stupidly) replied "okay." Because I knew I didn't have a choice if I wanted the flat.

dunstonh

If they recorded the calls, they'd be able to track down the conversation where the rep said something along the lines of, "We'll need you to take insurance, too because the kickback off such a small mortgage isn't enough," to which I (perhaps stupidly) replied "okay." Because I knew I didn't have a choice if I wanted the flat.

That doesnt make it a mis-sale. As long as the insurance was set up with monthly premium and you had a financial need for it then they have done nothing wrong by saying that.

roonaldo

in 2009, it would of stated the PPI was optional on most of the documents, ie. KFI, mortgage offer, ppi app form, DNS.

vyle

dunstonh wrote: »

That doesnt make it a mis-sale. As long as the insurance was set up with monthly premium and you had a financial need for it then they have done nothing wrong by saying that.

What do you mean by "financial need"?

marshallka

Wouldn't there have been a demands and needs statement done as this was 2009?

dunstonh

vyle wrote: »

What do you mean by "financial need"?

All protection products sold under advice have to show a financial need for them. i.e. are there consequences if you dont have protection. For life assurance, you have to show that someone is worse off in the event of your death. For mortgage protection, you have to show that you didnt have the savings/investments or other income to pay the mortgage should a claimable event occurred.

MPPI is very easy to justify as most people do have a financial need for it. That is one of the reasons that today it is still recommended for mortgages.

vyle

Ah I see. Thanks for that.