Reclaiming PPI from HSBC with loan still running...

NixiBean

Hi all this is my first post, I'll try and keep it brief. I just have a couple of questions regarding my reclaim.

I am in the process of reclaiming PPI I have paid on my loan with HSBC over the last 4 years and have just over 14 payments remaining :T. The problem is, that in my intial letter I requested to cancel my PPI and recieved a reply stating I would need to make an appointment with my local branch do so.

Yesterday I had my appointment which didn't go very well to be honest. According to them I will have to apply for a "new" loan as this is how it will be rearranged, which means I have to go through a whole new application including a credit check... I absolutely DO NOT want another credit search on my file as my credit rating is "fair" and I am currently trying to improve it.

My main issue is that if I just continue paying the PPI, surely I can't be trying to claim as well, as that appears a little contradictory, BUT the only reason the loan needs to be rearranged is because the PPI was frontloaded and so they can't simply cancel the PPI, they have to give me a new loan minus the amount they apparently loaned me to pay the PPI policy at the beginning? My biggest gripe with the having another credit check is I have never missed or made a late payment on this loan and I bank with HSBC (not for much longer at this rate) and I feel it is unfair to be subjected to a credit check to rearrange a loan that I already have and would continue paying if they hadn't frontloaded the PPI...?

I didn't do a very good job of keeping it short. Thanks to anyone who read all that...I'm a bit confused and not sure where I stand on this. Can I continue with the reclaim without cancelling the PPI. I think if I were successful, I would most likely ask for a figure to settle the loan and use the reclaim money for this rather than take out a new loan and take a hit on my credit file. Any suggestions gratefully recieved

Nix x

biondani

Yes you can continue your reclaim without cancelling the loan. If it the complaint is upheld then HSBC will have to calculate what position the loan would have been in without the PPI and adjust the loan to match this without doing a new loan which is what they are trying to do now. This is why it is best with front loaded PPI complaints just to continue paying the loan with PPI whilst your complaint is being reviewed. If you win then you will get the extra payments back with interest anyhow.

Ian

NixiBean

biondani wrote: »

Yes you can continue your reclaim without cancelling the loan. If it the complaint is upheld then HSBC will have to calculate what position the loan would have been in without the PPI and adjust the loan to match this without doing a new loan which is what they are trying to do now. This is why it is best with front loaded PPI complaints just to continue paying the loan with PPI whilst your complaint is being reviewed. If you win then you will get the extra payments back with interest anyhow.

Ian

Thank you so much for your quick reply. I think that is what I will do then. They have said they have to wait for an email to be sent to the branch confirming that they can rearrange the loan on the same terms and conditions (although it looks like I will likely lose the reward of 25% interest being refunded when the loan is satisfied) but the length and interest rate will be the same so they tell me.

I just want rid of the loan now. Hopefully I can just pay it off with the PPI refund and get rid. Happy days.

Dave_6

Mates in the same position, same time left etc, hsbc. We went into the branch and discussed things and worked out that taking the PPI off the loan now would have given him £1400 or so off, but if his loan goes the whole distance he gets back £1200 as a reward.

So we left things as they are and have continued with the claim... which has been with them since August last year, chased 2 months ago with a recorded delivery letter and not received a response so will soon be sending another (also emailed the managing director a few weeks back)

NixiBean

Dave_6 wrote: »

Mates in the same position, same time left etc, hsbc. We went into the branch and discussed things and worked out that taking the PPI off the loan now would have given him £1400 or so off, but if his loan goes the whole distance he gets back £1200 as a reward.

So we left things as they are and have continued with the claim... which has been with them since August last year, chased 2 months ago with a recorded delivery letter and not received a response so will soon be sending another (also emailed the managing director a few weeks back)

As it stands, if I just carry on with my repayments for the next 14 months including PPI I will recieve about £800 reward, however I would be paying about £500 on the PPI portion of the loan and the PPI I have already paid equates to almost the same as the remaining loan (minus the PPI portion). If I pay 14 more months of PPI I wont get it back so I will only gain £300 of the reward really, plus if I settle the loan early, I may save some interest depending on how much they penalise me for early repayment.

You never really win with banks, but if I can lose the loan and a bit of debt earlier than planned I'll be a happy girl

LouisJK

Hi Ni,

You situation is so much like mine it is scary. I took out a loan in 2007 for 60 months. I have 15 payments left. Back in october I wanted to look at getting it payed off earlier and so dug out my agreements only to find that I was paying ppi. Annoyed, at myself more than anything, I went to my local branch to have it removed. It is £50pm, so was quiet looking forward to having that extra money each month. However, like yourself, I was told I could not do this and I would have to refinance the loan. When the woman calculated the difference, it turned out I would save about £2 pm. Totally pointless.
Therefore, in went my claim for ppi as I genuinly never realised I had it and certantly didnt know I couldnt cancel it.

So, my claim was put on hold and I am still awaiting a decision. I will keep you informed of my progress and would appreciate it if you could do the same.

Fingers crossed for the both of us hey :-).

NixiBean

LouisJK wrote: »

Hi Ni,

You situation is so much like mine it is scary. I took out a loan in 2007 for 60 months. I have 15 payments left. Back in october I wanted to look at getting it payed off earlier and so dug out my agreements only to find that I was paying ppi. Annoyed, at myself more than anything, I went to my local branch to have it removed. It is £50pm, so was quiet looking forward to having that extra money each month. However, like yourself, I was told I could not do this and I would have to refinance the loan. When the woman calculated the difference, it turned out I would save about £2 pm. Totally pointless.
Therefore, in went my claim for ppi as I genuinly never realised I had it and certantly didnt know I couldnt cancel it.

So, my claim was put on hold and I am still awaiting a decision. I will keep you informed of my progress and would appreciate it if you could do the same.

Fingers crossed for the both of us hey :-).

Thanks for the reply Louis.

Our circumstances do appear very similar. I have only recently submitted my complaint so it sounds like I probably wont get my money back until next year at the rate they are going. My PPI payment on my loan is about £41 a month, and I took out the loan in 2007 also. I knew I had taken out the policy and it was relevant to me at the time, however the person who sold me the insurance very kindly implied that I might not be approved without it :mad:

I'm currently trying to clean up my finances and get everything in order, and was hoping to have made some good progress with things by the time I start my maternity leave in September...

LouisJK

Ni, when you say you will get back £800 reward, what exactly does it mean and what is it for?

amersall

NixiBean wrote: »

As it stands, if I just carry on with my repayments for the next 14 months including PPI I will recieve about £800 reward, however I would be paying about £500 on the PPI portion of the loan and the PPI I have already paid equates to almost the same as the remaining loan (minus the PPI portion). If I pay 14 more months of PPI I wont get it back so I will only gain £300 of the reward really, plus if I settle the loan early, I may save some interest depending on how much they penalise me for early repayment.

You never really win with banks, but if I can lose the loan and a bit of debt earlier than planned I'll be a happy girl

You need to work out how much the monthly ppi amount was times the number of months that you paid this, you will get this back plus the interest on those.

Also, your loan will have the total ppi amount taken off and this will reduce your balance and your payment will reduce by the ppi monthly amount.
When you work this out see if the £800 bonus is worth it.

NixiBean

LouisJK wrote: »

Ni, when you say you will get back £800 reward, what exactly does it mean and what is it for?

This is a very rough calculation of the repayment reward of 25% interest back when the loan finishes.

NixiBean

amersall wrote: »

You need to work out how much the monthly ppi amount was times the number of months that you paid this, you will get this back plus the interest on those.

Also, your loan will have the total ppi amount taken off and this will reduce your balance and your payment will reduce by the ppi monthly amount.
When you work this out see if the £800 bonus is worth it.

I don't think it is worth it all to be honest.

By my calculations:

Remaining Loan Payments = £2893.52
Minus Remaining PPI Payments = £576.10
(Hopefully Minus) PPI Paid (not including any interest) = £1893.04
This leaves an outstanding balance of £424.38 which I would need to find myself somehow. Not impossible though as that is only just over 2 months of repayments I've been paying until now. I am about to make another payment on the 28th of this month and I doubt I will have had any answer either way by then...