First Direct - Cancelling PPI

CDA13

Hello,

I am new to this site. I have made a complaint to First Direct to reclaim PPI for a loan that is fully up to date for started in 2005 and ending this June

However, as I have previously claimed on the PPI I am told I cannot reclaim any money back - ok fair enough. But, I want to cancel the existing PPI to reduce my monthly payments which they said I can do but I have to get a new loan as a condition to do this.
Here is what I wrote:

***
you have confirmed that I am able to cancel my PLPP, however, I do not agree to get a new loan. I simply wish for you to remove the PPL and restructure my repayments as the loan is due to come to an end in June 2012. As there are less than 6 payments left for the loan I would not to look be (A) credit checked as I have already been so for the original purpose of this loan (B) pay even more interest for a longer period of a loan term. This would cause me a financial dis-advantage which I am certainly not willing to enter.

***
In a nutshell I have just 5 more payments to make before the loan is settled so why would I then get a loan for the minium of another year?
All I want is for them to do is reschedule the payments less the PPI which will save me around £80 per month, or pay the same amount I am paying now and finish the loan earlier.

So, what I really want to know is can they peniliase me to take out another loan to cancel the PPI- if that is the case I'm going to run it till June as is- but this hardly seems right?

Any good advise is welcome - I have no idea what they can do or not do all I know is this seems crazy?!

Thanks in advance

amersall

However, as I have previously claimed on the PPI I am told I cannot reclaim any money back - ok fair enough.

This is nonsense! you can make a mis sell claim.

Look here for other reasons for mis sell
http://www.moneysavingexpert.com/reclaim/ppi-loan-insurance#step2

And if any/all apply to you,then put a claim in,you cannot say "you did not know you had it" as you made a claim,but the ppi mis sell has grown in the media a lot lately and that is why you checked to see if you had been mis sold.

If you cancel ppi on a loan they can redo another loan without ppi.

CDA13

Many thanks for your reply amersall, I’m very grateful for the link. My fury with First Direct has grown as they have said yes I can cancel the PPI but I have to keep paying for it-

Here is what they said:

I acknowledge your strength of feeling on the matter of cancelling your policy. As such, we can add an internal marker to your loan which would inhibit your PLPP. This means that in effect, the policy is cancelled and you could not make any further claims. However, your monthly repayments and term would remain the same. Please let me know if you would like me to proceed with the inhibit.

Do they think I was born yesterday? Basically they are telling me the policy was paid for in one go. I have the loan agreement which I signed and clearly states that the PPI is an additional monthly payment- they said this was for illustrative purposes only- errrr it’s a signed agreement.

No matter what I try and do they are insisting I must keep paying for the PPI, I have forwarded my case to the Ombudsman now. Who is their right mind would agree to cancel an insurance, not be able to use it and keep paying for it.

I’m so mad!!!

amersall

Have you put the mis sell complaint in?, if the ppi was added at the start of the loan and you paid this over the term with interest, this is front loaded ppi and is a good reason for mis sell.
If you win redress they will take the whole ppi off the balance of the loan your monthly payment goes down by the ppi monthly amount, they will take the money you claimed back from the redress and if the redress is more then you get the rest back to you, if they pay the 8% this is yours they cannot take this, and it is taxable so you will have to inform HMRC.

CDA13

Yes I've put the claim in for the mis sell. They said as I have benefited from the PPI then then I am unable to claim for mis selling and they are confident that I have been sold a product for which they gave to me. I have now opened a case file with the Ombudsman which they stated in their final letter I need to do for the purpose of the mis-selling. As far as cancelling the insurance they have not yet given me the “final letter” as I don’t want to pay for the insurance any more if I cancel it and cannot benefit it.
I’ve left this with the ombudsman now, so I will keep you posted of the progress made. Thank you for your help.

amersall

Do not cancel the insurance. wait for the FOS outcome, front loaded ppi is the most upheld of all ppi, i feel sure this is a win.

CDA13

Just the latest re First Direct-final letter recieved from re Canceling insurance- they wont restucture the payments, I still need to pay for the insurance even if I wish to cancel it. They also mentioned that that I never complained before so cant understand why I am complaining now or words similar to that effect. All with FOS now, taking an age to hear back from them but not giving up hope. Even if they deduct the money claimed on the insurance there is still close to 2K that could be refunded. I wont give up without a fight!

magpiecottage

The only way that I can see which means that the cost would not fall if you cancelled the policy is that the premium was paid at outset and added to the loan - which FOS would deem to be misselling.

It is fair that the value of any claim paid should be deducted from any redress due but unless it exceeds the cost to you, including interest, then I think Fist Direct will have a hard time persuading FOS that it should reject your complaint.