Please Help! Firstplus loan - do I take the ppi?

alibrockett

Can anyone help with our dilemma?

We are about to take out a First plus loan for £32,500 to consolidate our debts into one. Firstplus are strongly advising we take out ppi although have said that it won't affect their agreement to give us the loan. They are tempting us by offering a 5 year cashback bonus if we don't claim on the ppi. We could then use this to payback part of the loan? If we wished - which I think we would do. We would like to be able to pay the loan off quicker than the 25 years!

Do we accept their ppi or would an income protection insurance be better? Or is there anything else?

Little_Miss_Winner

OMG, why are you taking out a first plus loan??????

alibrockett

Tell me more?

CLAPTON

go over to the debt free wannbee board and post up your SOA and see what advice you can get there before taking out a firstplus loan.

and no dont in any circumstances take out a PPI with firstplus .. if you really need it then take it out separately

Little_Miss_Winner

Tell me more?

Well if you are looking at consolidating your debts into one, and have £32,500.00 outstanding and are struggling or have more coming out than coming in, how are you going to pay firstplus there monthly money plus extortionate interest.

This is taken from the firstplus website, based on your figures;-


Your quick quote

You could borrow £32,500.00
over 300 months (25 years)
at a monthly repayment of £243.73
Typical 7.9% APR variable.

Total amount repayable: £73,119.00:eek:


.

JoeK_3

alibrockett wrote: »

Can anyone help with our dilemma?

We are about to take out a First plus loan for £32,500 to consolidate our debts into one. Firstplus are strongly advising we take out ppi although have said that it won't affect their agreement to give us the loan. They are tempting us by offering a 5 year cashback bonus if we don't claim on the ppi. We could then use this to payback part of the loan? If we wished - which I think we would do. We would like to be able to pay the loan off quicker than the 25 years!

Do we accept their ppi or would an income protection insurance be better? Or is there anything else?

Why are you taking out the loan?
Do you have a mortgage?

How do you get paid at work if you are ill or have an accident?

What are your occupations and what are the chances of you being made redundant?

JoeK

alibrockett

We both work but our outgoings are mortgage £680 plus c/cards and loans nearly £1000 per month. Total £1680 month . Income only £2100 month Jobs are secure but you can never predict this for sure. We can remortgage next year but simply cant afford are repayments anymore . We have been offered £290 per month or £360 with ppi. After 5 years with no claims you get back the whole ppi of £7900, but then have to carrry on paying it (£70 extra month ) until loan is payed off.

Little_Miss_Winner

Hi Ali,

I think the first thing you should do is post on the debt-free wanabee board and make an soa (statement of affairs)

Include all your incomings.
List all your outgoings (mortgage, c.tax, gas/electric/phone/food/petrol) Everything you pay on a monthly basis.
Then do another list of how much you owe to your credit cards etc...

There may be loads of ways that you can cut down what you are currently paying each month.

Debt consolidation really isn't the way to go, especially considering the amount of money you will be paying back over the next 25 years! With first plus you are going to be paying back an additional £41 K just on interest alone!!

There are loads of threads all about first plus, and people have really gotten into trouble going with these companies whose apr's are massive. The loan is secured on your home, so if ever you miss a payment, your home may become re-possessed.

Gather all your information together, then head over to the dfw board, and we will see where we can save you money!!!

Good Luck.

Little_Miss_Winner

Also click on this link below, re; ppi and first plus!

http://forums.moneysavingexpert.com/showthread.html?t=419257&highlight=first

Rafter

ali,

Despite the refund offer, this type of insurance is hugely overpriced and because it the whole 25 year premium is added to your loan up front, you pay a huge amount of interest on it. If you are in a position to repay some of your loans in a few years, you will probably find you still owe more than the original amount borrowed.

Here is my advice.

If you current debts are truly unaffordable you may be able to negotiate some sort of repayment plan or IVA, however, your ability to get credit and a decent mortgage offer in future may be compromised for 6 years. You may be debt free within 5 years though.

If a secured loan and lowering your repayments is the way forward a short term secured loan until you can remortgage may be suitable.

If you are worried about losing your home if your circumstances changed then take out a stand alone income protection policy - have a look on Moneysupermarket.com. I think you will find the premium a lot lower than you are being asked for by first plus.

If you do go this route, cut up your credit cards, budget carefully and start to try and repay the £32,500 debt. If this has built up because of home improvements, holidays, cars etc you really don't want to be repaying it still in 25 years. Similarly, you don't want to end up in even more debt by filling up your credit cards again.

Good luck.

R.

bravemanscotland

dont take it out its an expensive con, if you claim on it it could cost you £KS, and if you dont you just get your own money back that you borrowed off them.