Loan for remortgage PPI

zaksmum

On loan paperwork from 2003 PPI is shown as having been taken out.

The agreement states that if the PPI is cancelled at any time, the entire loan must immediately be repaid.

Does this sound like the PPI was missold?

[Deleted User]

Just sounds like a condition of the loan, not mis-selling at all.

zaksmum

Doesn't it make the PPI compulsory though? Because they said the loan will be immediately repayable if the PPi is cancelled?

So to have the loan, you must also have the PPI?

dunstonh

Insurance as a condition of a loan is allowed. It is when you are told it is a condition when it isnt that is wrong.

zaksmum

Thanks dunston. It's just that in the PPI checklist on here, it says PPI is missold if you were told it was compulsory...unless I'm reading it wrong.

dunstonh

zaksmum wrote: »

Thanks dunston. It's just that in the PPI checklist on here, it says PPI is missold if you were told it was compulsory...unless I'm reading it wrong.

The checklist here is either wrong or you have misread it. Possibly, it is written for expedience. A lot of the articles on this site are written to be read quickly and understood easily. When you start adding caveats and technical notes, people wont read them. This can lead to them being incorrect in some scenarios.

The majority of the time, if you were told you needed insurance then chances are you didnt and that is a mis-sale. Hence, why you see that said. The minority of cases that did need it as a condition were not mis-sold on that point.

The three areas where it is common is the business sector where commercial debts can frequently fail if the business owner or key employees becomes ill or die. So, you often see insurance as a condition as a form of security. Mortgage brokers often require insurance to be bought to allow them to offer "free" mortgage advice. They make their money on the insurance. The other would be old mortgages where the interest rate deal was dependent on a cross product purchase. Typically an insurance product. All allowed.

it should also be noted that a complaint on the basis of being told you needed it is one of the weakest going. If there is not evidence to back up that allegation, then that point is usually rejected. Evidence would rarely exist as you would have to be relying on the person involved slipping up in a recorded conversation or documenting it in a report incorrectly.

zaksmum

Thank you dunston. I understand it a bit better now. This loan was part of a remortgage and secured on the home, and still outstanding as the mortgage has not yet been paid off and I was taking the information on here as gospel. I will be less inclined to do so in future.

Thanks again.

dunstonh

I would still suggest a complaint on the basis that it was single premium and added to the loan which you then paid interest on. Plus, the policy would not have covered the whole period of the loan (again, that last reason may not apply but it does in many cases). You still have scope. Just because it was needed, does not mean they had the right to set it up in that way. Monthly premium, standalone PPI was how it should have been set up.

zaksmum

Thanks dunston. Might be worth going ahead with the reclaim attempt then.