PPI Missold?

thecassman86

Hi there,

In July 2010 i bought my first house through the government's HomeBuy scheme. As part of this i was put in contact with an independent company who help to set up first time buyers in new build houses. The general details of this are generally irrelevant and i have since actually remortgaged.

My question is regarding Mortgage Payment Protection Insurance... When i was signing up for everything for the buy we met up with an advisor who explained everything perfectly well and made sure we were aware of everything that was happening. As such, i WAS[/B] aware of the Mortgage PPI and i was told who will take it and how much it'll be etc. Fine.

The issue i now have, 3.5 years on, is that i've found out that mortgage payment protection is NOT a requirement of a mortgage and it's totally up to you to decide whether to take it out. However, the advisor made it perfectly clear that it was a requirement and the mortgage company would not lend us the money if we didn't have the balance insured with the PPI... Is this considered misselling?

So, to confirm, i've been paying Mortgage PPI for 42 months. I have all of the paperwork that i signed when i accepted the payment and i've always been aware of it's existence, however, i was initially informed that it was a compulsary thing when i bought the house. So, where do i stand?


Any help will be appreciated,

Rich

dunstonh

The issue i now have, 3.5 years on, is that i've found out that mortgage payment protection is NOT a requirement of a mortgage and it's totally up to you to decide whether to take it out. However, the advisor made it perfectly clear that it was a requirement and the mortgage company would not lend us the money if we didn't have the balance insured with the PPI... Is this considered misselling?

If you have it in writing (so it is perfectly clear) that you had to have it and you didnt then you have good grounds for complaint. If you dont have it in writing then it is a weak allegation without evidence and easily rejected on that point. If it is monthly premium then it is set up correctly as well and you would need to be ineligible or not have a financial need for a complaint to succeed. If it is single premium, then that is considered bad and that is a valid complaint reason.

Most adviser sold MPPI is rejected by both firm and FOS. (adviser sales account for only 0.2% of PPI complaints as well - it is not seen as an adviser failing).

thecassman86

Hi dunstonh,

Thanks for your reply!

Yes, that's sort of how i expected the case to be if i'm honest. I don't have any evidence that the policy was sold to me as a pre-requisite of the mortgage; that is what i was told by the advisor but all of the paperwork is purely for the acceptance of the PPI - not the advisors 'terms'. I had wondered how it could ever be possible to prove that he advised what he did!

As i said, everything was explained to us clearly and properly; it is paid as a monthly premium and the DD has been there from the start so there's been no misselling in that respect - it was purely the information that was a bit suspect.

In that case, not much i can do. I think i'll cancel the policy anyway as i have other options in meeting payments should i not get paid so the PPI is a little unneeded anyway.

Thanks for you help.
Rich

dunstonh

I had wondered how it could ever be possible to prove that he advised what he did!

In most cases it is not which is why most complaints on that basis fail on that point. After that point fails, they are required to check suitability and that is often where the banks fall down. They tend to lack an audit trail. Whereas an adviser will have a factind, needs analysis and on a 2010 case there would be a statement of demands and needs. The audit trail on advised cases is normally good enough.

It should also be noted that many brokers give free mortgage advice as long as you purchase insurances with them. They make their money that way. That model is allowed as long as the insurance is required. So, whilst a lender may not have needed it, the broker may have done.

magpiecottage

You will have been issued with a "Key Facts" document produced by the lender (although possibly printed by the broker). This will tell you what insurances were required and what, if any, you had to take through the broker.

It will almost certainly say that it did not need to be taken through the broker and that will be the only hard evidence.

At that point your complaint founders.