LloydsTSB 'Front Loaded' PPI Claim Help - (7 loans from 1994 - 2000)

CheekyMonkey

Dear all........just a quick question regarding submitting a PPI claim to LloydsTSB.

During my younger years I was rather stupid in taking out loans every time that I wanted a new car, getting myself into all sorts of financial problems. When I look back I haven't got a clue what I was thinking - running up huge debts and constantly being overdrawn.

So far I've held off from submitting any kind of claim for PPI, as I always thought it was too long ago and that I didn't have the paperwork - putting the whole episode down to experience. BUT......during a recent 'spring clean' of the loft I found everything relating to the 7 loans I took out with Lloyds......and details (including names) of the fact I was told each time that I would not qualify for the loans unless I took out PPI.

My main question is in regards to whether I should submit one claim covering all 7 loans from 1994 to 2000, or separate claims for each? (One Lloyds loan was with LoansDirect).

All the PPI's were Single Premium and I believe the term is 'front loaded' - so when I asked for a £3000 loan, PPI of £340 was added to the total borrow, making the loan amount £3340.

In addition, I then consolidated the loans 4 times to give me some cash in my pocket and pay off the existing loans and PPI. Trying to work out the potential claim is therefore extremely confusing - although I do have all the paperwork showing PPI to the value of £4.1k.

Any assistance in regards to one single claim or multiple claims would be greatly appreciated. Many thanks

DevCoder

Just to clarify, when you consolidate the loans then the remaining period of PPI is not taken into account, so if you have a total PPI of 4.1K then the fact you consolidated means the value will be less.

How much less depends on how far into the loan term you were before you re-consolidated.

amersall

When you settled one loan with another, you would have been given a rebate of the PPI on the first loan, the remaining PPI will have been paid back by you in the settlement figure.

If you win mis sell you will get the whole PPI amounts back, the interest on the PPI payments that you actually made, you do not get the interest on the remaining PPI as you did not pay this, less the rebates.

Claim for all 6 ( do the loans direct one straight to loans direct ) make it clear that you want all of these to be looked at as they were all consolidated into the next.

-taff

CheekyMonkey wrote: »

I found everything relating to the 7 loans I took out with Lloyds......and details (including names) of the fact I was told each time that I would not qualify for the loans unless I took out PPI.

Oh dear, I bet that's going to sting....good on you.

CheekyMonkey

krisdorey wrote: »

Just to clarify, when you consolidate the loans then the remaining period of PPI is not taken into account, so if you have a total PPI of 4.1K then the fact you consolidated means the value will be less.

How much less depends on how far into the loan term you were before you re-consolidated.

Im slightly confused as the PPI was a single premium added to the total loan value. For example:- lets say I had £800 of PPI on Loan 1 over 4 years, after 3 years (£600 of PPI repaid) I took out a new loan which cleared the old debt and PPI (balance of total borrowed).

The new loan over an additional 3 years also has PPI on it, but includes the balance of Loan 1 and the £200 of PPI from Loan 1. So effectively Im paying PPI on PPI.

Unless Im getting confused, but I never had any PPI rebate or deduction of PPI from the new loan?

CheekyMonkey

amersall wrote: »

When you settled one loan with another, you would have been given a rebate of the PPI on the first loan, the remaining PPI will have been paid back by you in the settlement figure.

If you win mis sell you will get the whole PPI amounts back, the interest on the PPI payments that you actually made, you do not get the interest on the remaining PPI as you did not pay this, less the rebates.

Claim for all 6 ( do the loans direct one straight to loans direct ) make it clear that you want all of these to be looked at as they were all consolidated into the next.

Does anyone know the address for LoansDirect, as I thought they were actually part of Lloyds and not a broker?

dazza12

Lloyds TSB (and HFC) are noted for not giving back rebates of PPI. The first loan you were paying interest on the PPI as well as the loan amount, the second loan you were effectively paying interest on interest on PPI, the third interest on interest on interest on PPI and so on.

A work colleague had his complaint against Lloyds upheld in similar circumstances (he had 4 loans of about £5k each that rolled over) and received a refund of just over £16k. He asked for a breakdown which showed as above that the PPI hadn't been refunded on rollover, just rolled over into the next loan.

On another forum, there are a number of people that have gone through the same as you so it may be worth googling for 'Single Premium' in order to get some pointers.

Depending on how the evidence of the compulsory nature of the PPI is presented (i.e. is it a letter?) you sound like you've got a good cause for a complaint. You've also benefitted from the fact that you've kept all your paperwork so you should be able to complete the questionnaire as fully as possible.

CheekyMonkey

Cheer Dazza12......I thought that was the case.

Found this article the other day as well:-

I had a loan which included a Single Premium PPI. It was initially an 8 year loan. After 6 years I took out another loan which gave me some cash in my pocket and also paid off the balance on my previous loan. The second loan also had PPI included and the term of this new loan was 10 years. What do I claim?

This is another scenario where the banks can make more money from you, the unsuspecting “customer”. (Sometimes referred to as the victim).

We already know that if you had stuck with loan 1, your PPI part of the loan would have run for 8 years because it was included in the main loan. But you have effectively taken the balance on that loan after six years and transferred it into a new loan. Accordingly part of the balance transferred or “rolled over” into the second loan would have included the balance on the PPI part of loan 1. That balance would be paid off over the term of loan 2.

To see how the advantage is with the bank, consider this.

Your original loan was for 8 years so you would have originally have been paying the PPI part of the loan for that period. You refinance after 6 years and let us suppose that a sum of, say £400 being the PPI balance on the old loan, is rolled into loan 2.

Now the term of loan 2 is 10 years. So that balance of £400 is now being paid off over a period of ten years. And for those ten years you will be paying interest on that rolled over amount. Had you stuck with loan 1 only, then that £400 would have been paid off over only two years. You can see that this is a tidy profit for the bank.

And of course you have PPI on loan 2 as well and you’re paying that PPI off over a period of 10 years as well.

If we look a bit deeper, the PPI cover on loan 2 was actually covering you for some PPI on loan 1. So you have been sold PPI to cover PPI. What’s that all about then?

So who is the winner? It certainly isn’t you so I wonder who it could be?

So what about the calculation of the refund that is due?

First off you calculate the percentage of PPI which is included in the first loan as described above.

Second, we have to find out what the balance of the PPI part of loan 1 was when it was rolled into loan 2. That can be done using the loan progression spreadsheet.

Third, we have to express that balance as a percentage of the total of loan 2.

Fourth, we need establish the percentage of loan 2 that relates to the loan 2 PPI.

Then we need to enter the data into the spreadsheet.

This scenario is probably best explained using an example.

Let us suppose that we have established that loan 1 had a PPI percentage of 7.75% of the total of loan 1.

Let us say that we have worked out (or the bank have told us) that the balance on loan 1 at the time of refinancing is £1,500. We now know that 7.75% of that £1,500 is the PPI part of loan 1. 7.75% of £1,500 is £116.25 which is the amount of PPI rolled into loan 2.

Now let us suppose that loan 2 was for a total amount (including the PPI on loan 2) of £5,000 and that the loan 2 PPI premium included in that was £600.

The percentage of loan 1 PPI included in loan 2 is given by £116.25/£5,000 x 100 = 2.33%. So for every repayment you make on loan 2, a sum equivalent to 2.33% of it relates to PPI on loan 1.

Now we also now that of the £5,000 for loan 2, that included a PPI premium of £600, so loan 2 PPI percentage is £600/£5,000 x 100 = 12%. That means that for every repayment we make on loan 2, an amount of 2.33% of it is going to loan 1 PPI rolled over and an amount of 12% of it is paying the PPI on loan 2.

So to enter this in the spreadsheet you list the actual payments made for PPI on loan 1 prior to refinancing. From then on you list the 2.33% of each payment and annotate it as Loan 1 PPI and then you list the 12% of each payment which relates to the PPI on loan 2.

http://www.consumeractiongroup.co.uk/forum/showthread.php?318646-PPI-Single-Premium-Your-questions-answered

-taff

CheekyMonkey wrote: »

Does anyone know the address for LoansDirect, as I thought they were actually part of Lloyds and not a broker?

Send your complaint to whoever sold you the loans, in your case, Lloyds

CheekyMonkey

Im currently completing the questionnaire and have all my customer copies of the loan agreements, but I dont have any PPI certificates (with certificate numbers on). All I have is the credit agreements from Lloyds with the loan value, ppi value and length of the loan - plus about 3 other pages of terms & conditions.

Only 1 loan is actually dated*, but I have no PPI certificates and Im 99% positive that I never received any? Does anyone know if Lloyds ever issued PPI certificates as such?

(* I've found the dates of the other loans, as I have all my statements available - which also shows the acounts numbers).

-taff

No, there's no separate certificate. You only need the loan account numbers.