8% Interest on Loan PPI

deanbwfc

How does this 8% interest on the loan PPI claims work? Is it just the 8% of the total balance paid in PPI from the date you started paying until the date the claim is paid back?

I started my loan Lloyds TSB in August 2006 and finished it in 2008 so was just wondering how i would work it out? Thanks

di3004

deanbwfc wrote: »

How does this 8% interest on the loan PPI claims work? Is it just the 8% of the total balance paid in PPI from the date you started paying until the date the claim is paid back?

I started my loan Lloyds TSB in August 2006 and finished it in 2008 so was just wondering how i would work it out? Thanks

Good luck, here is an example of my 2 that succeeded with Lloyds, so hope this gives you an idea, good luck.;)

Thank you for your patience while I have investigated the concerns you raised regarding your PPI.

I am sorry to hear you have had reason to make a complaint. I have conducted a further review of your complaint and feel I am in the position to provide you with a response based on the information available to me.

I have completed my investigation into your complaint, reviewed any records relating to the sale of your protection policy and have taken into account your complaint points and the comments noting on your circumstances at the time of the sale.

loan XXXXXXXXX

I have decided to uphold your complaint and to offer to settle your complaint in the following manner, I propose to:

Calculate the difference between the settlement balance you have paid on the loan and what the settlement would have been had the PPI premium not been added to your loan.

We will then calculate an 8% interest payment on this sum from the day the loan was settled to the day the calculation is completed.

We will then calculate the amount you have paid to the date of cancellation and refund this back to you. This is worked out by calculating how much you paid each month in respect of the insurance alone and then multiplying this figure by how many months the insurance was active for.

If you would like a clearer indication of the PPI monthly payments you have paid to date, you will be able to obtain the copy of the Consumer Credit Agreement you received when taking out the loan. This document will tell you the PPI monthly premuim amount. I can confirm from our records that the premium was for £443.24 in total.

We will then add simple interest at 8% per annum to each monthly payment from the date you paid each amount, to the date you settled the loan.

A further 8% simple interest per annum will be calculated on this total amount from the date of early settlement of the loan to the present date.

The 8% simple interest amount will then be calculated when we receive your signed acceptance. This will only be processed at this point to ensure the figure is calculated accurately and more importantly, correctly. The calculated simple interest at 8% will then be refunded into your bank account.

As you received partial rebate in respect of your insurance of £69.88 on 30 January 2011, this will be taken into consideration when calculating the refund.

If you would like to accept this offer, please sign the enclosed acceptance slip to confirm this and return it in the pre-paid envelope.

Should you choose to accept this offer, I will instruct our redress function to commence the relevant calculation. Please be advised that this redress remedey has been designed to ensure that you are put back to the same position you would have been in, had the PPI not been sold to you.


Loan xxxxxxxxxx

I have decided to uphold your complaint and offer to settle your complaint in the following manner. I propose to:

Calculate the difference between the settlement balance you have paid on the loan and what the settlement would have been had the PPI premium had not been added to your loan.

We will then calculate an 8% interest payment on this sum from the day the loan was settled to the day the calculation is completed.

We will then calculate the amount you have paid to the date of cancellation and refund this back to you. This is worked out by calculating how much you paid each month in respect of the insurance alone and then multiplying this figure by how many months the insurance was active for.

If you would like a clearer indication of the PPI monthly payments you had paid to date, you will need to obtain the copy of the Consumer Credit agreement you received when taking out the loan. This document will tell you the PPI monthly amount and will be the figure I use when calculating your refund. This amount will then be multiplied by the number of the monthly payments you have made. Having checking the records, I can confirm that the full premium was for £1305.18.

We will then add simple interest at 8% per annum to each monthly payment from the date you paid each amount, to the date you settled the loan.

A further 8% simple interest per annum will be calculated on this total amount from the date of early settlement of the loan to the present date.

The 8% simple interest amount will then be calculated when we receive your signed acceptance. This will only be processed at this point to ensure the figure is calcuated correctly and more importantly, correctly. The calculated simple interest will then be refunded into your bank account.

As you received a partial rebate in respect of your insurance of £739.16 on 22 November 2001, this will be taken into consideration when calculating the refund.

(And the remaining is the same as above, to be put back in the position as if no ppi).

.................................................. .................................................. .........

-BA-

di3004 wrote: »

Good luck, here is an example of my 2 that succeeded with Lloyds, so hope this gives you an idea, good luck.;)

Thank you for your patience while I have investigated the concerns you raised regarding your PPI.

I am sorry to hear you have had reason to make a complaint. I have conducted a further review of your complaint and feel I am in the position to provide you with a response based on the information available to me.

I have completed my investigation into your complaint, reviewed any records relating to the sale of your protection policy and have taken into account your complaint points and the comments noting on your circumstances at the time of the sale.

loan XXXXXXXXX

I have decided to uphold your complaint and to offer to settle your complaint in the following manner, I propose to:

Calculate the difference between the settlement balance you have paid on the loan and what the settlement would have been had the PPI premium not been added to your loan.

We will then calculate an 8% interest payment on this sum from the day the loan was settled to the day the calculation is completed.

*snip*
.................................................. .................................................. .........

Hi di3004. Just been reading the letters you received. Do they not calculate 8% interest from the day the loan was taken out rather than settled? Seems a bit off if that is the case.

IANC

-BA- wrote: »

Hi di3004. Just been reading the letters you received. Do they not calculate 8% interest from the day the loan was taken out rather than settled? Seems a bit off if that is the case.

The letter states that they add 8% per annum (to the monthly premiums), then add this to the premiums paid from the start of the loan until the settlement date.

They then add a further 8% per annum to that total from the date it was settled until now :money:

joanne13

Can someone please tell me that I am not alone in not understanding how the 8% interest calculation works.
I have tried to get my head around it numerous times, but I just dont get it.
Have given up now and will just see what the amount is, if and when my complaint is upholded.

marshallka

If you had a loan and it was settled early then you would have paid so many payments that were towards the PPI (reflected in your monthly repayment) and for each of these repayments from the date they were made, you would get 8% statutory interest until todays date. When you settle a loan you also settle an amount that goes towards the "loan that pays the PPI over to the insurer".... from the date you settle the loan you also get 8% interest on any amount that is paid due to the loan for the PPI.

If you pay a loan to term then you get 8% statutory interest on each repayment you made towards the PPI from the date you made that repayment to todays date.

Hope this helps.

travller1961

I have just had an offer from my ppi company, the interest part offered amounts to £2700, they then advise me that it is subect to tax. Is this correct that I have to pay tax on the money I paid in, which i had paid tax on when i earned it and tax on the 8% interest they are paying me, when the savings limit is £2500 pa

Please can anyone tell me if I have to pay tax on this return of my own money?:mad::mad:

dilus

travller1961 wrote: »

I have just had an offer from my ppi company, the interest part offered amounts to £2700, they then advise me that it is subect to tax. Is this correct that I have to pay tax on the money I paid in, which i had paid tax on when i earned it and tax on the 8% interest they are paying me, when the savings limit is £2500 pa

Please can anyone tell me if I have to pay tax on this return of my own money?:mad::mad:

Hi travller1961,
You do have to pay tax on the 8% standard interest, the 8% interest is a form of compensation, because if you hadn't been paying the PPI you could have invested this money in a high earning savings account and any interest on it would have been taxable as it classed as income. 8% is a very good return on anyone's money over the last 10 years or so. It hurts I know but it is income

travller1961

Thank you dilus,

I thought as much!:(
So I take it the charge me 20% on the £2700 on just this tax year as I am receiving it this year, and not on each year of that intresested was paid for, other wise it would be over 12 years.

dilus

travller1961 wrote: »

Thank you dilus,

I thought as much!:(
So I take it the charge me 20% on the £2700 on just this tax year as I am receiving it this year, and not on each year of that intresested was paid for, other wise it would be over 12 years.

Just this year and 20% if that is your income tax rate, inform HMRC and they will either change your tax code or send you a payment slip so that you can pay by cheque. Don't risk not doing it as the HMRC are asking the banks for details of gross payments