bank says we have to change loan to cancel ppi

Pol23

My partner took out a loan with a high ppi in 2005 because the bank said he couldnt have the loan with-out it. I have realised that it is costing him an extra £70 a month so I sent off a letter (on his behalf) asking to cancel the payment protection. The bank phoned him to say that they couldn't cancel it but could re-negociate the loan. (my partner has asked them to put this in writing) I'm guessing that if he re-negociates it is going to cost him just as much. Has anyone else had this problem & if so were they able to get the ppi cancelled. the bank is HSBC. Any help would be great. This is my first time on this forum. Thanks

Astaroth

Yes, some banks have PPI as an add on product so it can be simply cancelled and taken off. Others have 2 products, one with PPI and the other without, if you buy the one with then it cannot be simply cancelled but of cause you can get a new loan without it (with the same lender or not) and just early settle the original loan.... for a quick analogy it is like cameras, you can get SLR cameras where you can take off the lens and swap it for another and you get point and shoots where the lens is built in and the only way to change it is to change the whole camera.

Pol23

How can I tell if the loan he has is the camera that we can change the lens on or not, or do I have just have to trust the bank when they say we have to re-negociate the loan

Astaroth

You really would have to trust the bank, but there are posts on here on cancelling PPI so you could see what other HSBC customers have said.

Whilst there is always exceptions to a rule, banks on the whole do not actually lie to customers... doing so as a business as usual would get their licence to be a bank revoked from the FSA and effectively close them down.

Rafter

If they told him he could not have the loan without protection then the insurance has been MISSOLD.

Insurance is for your protection - not the banks. It is not compulsory, it just makes the banks a shedload of money - over £5bn a year in profit according to Which?

Escalate it as a complaint and see where that gets you. They may well remove the insurance from now, or even better refund all your premiums to date too.

R.

gypsysaffy

my bank are doing exactly the same thing asking me to take a new loan out but it could be at a higher interest rate as i do not work the ppi is not really any good for me but they will not cancel it. i have now wrote a letter of complaint to the bank and if not given any help i am seriously considering writing to the banking ombudsman. Not sure whether i will get anywhere though. g

Pol23

thanks all for your advice, I'm gonna wait & see what the bank says in their letter, & I'll probably be writing a letter of complaint. I'll let you know how it goes.

cheers

P