BLRI and early repayment

sarah-jane2

Hello

I've done some reading around, but haven't yet found an answer, so any help appreciated. Sorry, I know this is a well-trodden path...

Took out a £8000 business loan in 06. 60 month term. BLRI £720.90, over 59 instalments, etc. I wasn't told the insurance was optional.

I repaid the loan early - around 2009 I think. I've found the settlement figure - £3844.30 - which I've scribbled on a letter along with a number for 'Stirling, Insurers'.

OK, my question:

I recall reading somewhere in my trawling around the internet that if you have repaid a loan early, the full amount of insurance will have been refunded. I have no recollection of whether that happened! And without a date, it will take me a while to find out.

So, does early repayment always mean insurance is refunded? Or is it worth my while digging out the info?

Thanks for any help.

dunstonh

I wasn't told the insurance was optional.

It may not have been. A lot of commercial loans require insurance to be taken.

I recall reading somewhere in my trawling around the internet that if you have repaid a loan early, the full amount of insurance will have been refunded. I have no recollection of whether that happened!

That is not correct. A relatively pro-rata refund would have been given. Some include it in the settlement figure. Others refund after the event.

sarah-jane2

Thank you! A pro-rata figure seems logical to me, I just didn't want to spend hours and hours on this only to find it was a non-starter. Time is money!

I guess what I mean is that I wasn't told that LloydsTSB insurance was optional, ie I could get insurance from somewhere else.

dunstonh

I guess what I mean is that I wasn't told that LloydsTSB insurance was optional, ie I could get insurance from somewhere else.

They dont have to tell you that you can buy it elsewhere. If you ask about buying it elsewhere then they have to allow you. However, they dont need to go out of their way to tell you.

amersall

Also, after the rebate of PPI for early settlement, the remaining PPI would have been repaid by you in the settlement figure, so you would have paid the majority of the PPI back anyway, this is very unfair.

sarah-jane2

Right, so they don't have to tell me I can buy elsewhere. I guess then, in order for this to have been mis-sold, it would have to be the case that insurance was not compulsory? How do I find that out?

(I wrote to LloydsTSB asking for the T&Cs for this loan ages ago (like, years!). No reply.)

I don't know Amersall - I reckon the banks do 'unfair' on a pretty regular basis!

jay-1

sarah-jane2 wrote: »

Right, so they don't have to tell me I can buy elsewhere. I guess then, in order for this to have been mis-sold, it would have to be the case that insurance was not compulsory? How do I find that out?

(I wrote to LloydsTSB asking for the T&Cs for this loan ages ago (like, years!). No reply.)

I don't know Amersall - I reckon the banks do 'unfair' on a pretty regular basis!

I am sure amersall will come back to you to explain how this "unfair practise" should provide you with a good reason for your complaint.

sarah-jane2

Aha, good! I feared I might be missing the gist of their post...

amersall

You can make a claim with the reasons
1) you were not told this was another loan on the loan that you repaid to term with interest.

2) you were not made aware of the fact that on early settlement, the remaining PPI, after the rebate of PPI, was repaid by you in the settlement figure.

3) Had you been told the full cost and the unfair rebate at early settlement of this PPI, you would not have taken it.

Give it a try, you have nothing to lose.

sarah-jane2

I'm struggling to understand that Amersall...can you explain again, but as if you are dealing with a complete idiot?

1) I'm lost

2) Are you saying that although I got a BLPI refund, the loan settlement figure would have been less a disproportionately large amount of BLRI?

3) If I've got 2) right, I get this.

Thank you.

dunstonh

A chain of loans where one loan is repaid with another and PPI is charged on each frequently gets upheld on complaints as despite some refund, the debt is increased each time. That is a fairly solid complaint reason.