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PPI reclaim on loan passed to collection agency

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charlie51
charlie51 Posts: 2 Newbie
edited 21 June 2012 at 2:30PM in Reclaim PPI & other insurance
Hi,
My apologies first of all if this post is in wrong section/thread but as a newbie i'm hoping for forgiveness. :o

My friend has just heard back from santander that she can get just over £1000 back on her loan BUT because she defaulted due to ill health and personal issues the loan had been passed to a collection agency and santander have said that this money must be paid to them to reduce the amount owing.

As she is now disabled and struggling living on dla alone as her esa has been stopped (which is a whole other can of worms!) she was hoping to use some of this money to pay bills etc.

So, my question is, (sorry for waffling), can santander just send the money owing to the collection agency without her consent?

Thanks for any help you can give. :j

Comments

  • dunstonh
    dunstonh Posts: 119,624 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    So, my question is, (sorry for waffling), can santander just send the money owing to the collection agency without her consent?

    Yes. They are allows to use the redress against arrears, defaults and amounts written off.

    If you think about it logically, she hasnt paid the debt which includes the PPI. So, why should she get a refund from it. If someone owed you money and had broken the terms of the repayment (i.e. gone bad) and then asked you to pay them some money back, would you?
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • Thanks for your quick response, I did wonder if that was the case but said i'd find out for her.
    At least they were quick responding, I'm still waiting to hear back from Lloyds TSB about my completed loan! I may be back! :D
  • dunstonh
    dunstonh Posts: 119,624 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    Plus, its a bit less of the debt she has to repay. So its still good news.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
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