PPI Claim Mortgage

Orcaorca

Hi

Just looking for some advice about a PPI claim I have made. I'd like to get some sound info incase I need to pass anything on to the Financial Ombudsman.

We had a joint mortgage with Nationwide and took out their PPI when we took out the mortgage in 2005. We think it was a joint PPI policy.

We were told at the time it is better for first time buyers to take it out with Nationwide.

We paid about £40 each month for 6 years.

The policy only covered us for about £400 - only half the mortgage so even if we both had made a claim only half the monthly loan payments would have been paid...seems odd

Also my husband had ill health cover through his work 6 months full pay 6 half pay and I had about 4 months full pay cover as I was a teacher.

Does that mean if my hubby was sick they wouldn't have paid us?

Also how would it have worked in terms of one of us being made redundant or sick - would they have paid or would we both have had to not been able to pay?

Also we had mortgage guarantors when we took out the loan which Nationwide had on their file as we were first time buyers so did we even need it?

Is it true we were paying interest on our policy or is that other types of ppi?

Secondly we changed our mortgage provider in 2011 to halifax but took out ppi with LV. This time only in my hubbys name. Again he had good sick pay 6 months half 6 months full. Again the policy only covered part of each full monthly amount.

Should this policy have been in both of our names as it was a joint mortgage? Would they have paid us if my hubby was ill or made redundant? Again did we pay interest on the payments(£60 per month) . They said it was quite a high amount £60 each month as my hubby worked for a bank. We paid this for 2 years from 2011.

Also would the policies have run the course of both mortgages - 25 years or would they have ended at some point?

Any advice much appreciated - we dont really understand the ppi policies or how they would have worked! So any advice is much appreciated!

dunstonh

The policy only covered us for about £400 - only half the mortgage so even if we both had made a claim only half the monthly loan payments would have been paid...seems odd

Its not odd. It is very rare for anyone to cover themselves for their full insurance needs. Most people take an approach limited by budget which means covering yourself for less than you need but better than nothing.

Does that mean if my hubby was sick they wouldn't have paid us?

They would have paid you. MPPI is not limited by workplace benefits. It is one of the reasons why most MPPI complaints get rejected. Even the FOS have been rejecting complaints where people have 6 months full pay, 6 months half pay.

Also how would it have worked in terms of one of us being made redundant or sick - would they have paid or would we both have had to not been able to pay?

It only requires one of you to suffer a claimable event.

Also we had mortgage guarantors when we took out the loan which Nationwide had on their file as we were first time buyers so did we even need it?

This actually increases the financial need for MPPI. It strengthens the case because it means that if you cant pay, you are not only affecting your finances but also those of the guarantor.

Is it true we were paying interest on our policy or is that other types of ppi?

The vast majority of MPPI is standalone monthly direct debit. You cant pay interest on those. Again, another reason why most MPPI complaints fail. There are some older mortgages where home insurance, life assurance and MPPI could be paid with the mortgage but these were either on nil-interest sub accounts or paid the same dates as the mortgage payment. So, again, no interest. The only MPPI that is considered bad on that front is single premium MPPI added to the debt at the start. However, no bank or building society has ever sold that type of plan.

Secondly we changed our mortgage provider in 2011 to halifax but took out ppi with LV. This time only in my hubbys name. Again he had good sick pay 6 months half 6 months full. Again the policy only covered part of each full monthly amount.

Should this policy have been in both of our names as it was a joint mortgage? Would they have paid us if my hubby was ill or made redundant? Again did we pay interest on the payments(£60 per month) . They said it was quite a high amount £60 each month as my hubby worked for a bank. We paid this for 2 years from 2011.

AFAIA, Halifax didnt retail LV products. So, they would not be responsible for a purchase of a product made via another provider or via a third party. Halifax have their own in-house product.

sick pay is irrelevant as already mentioned and part amount is easily covered. Discussions on budget are what you have at the time and the decision is agreed based on that.

Also would the policies have run the course of both mortgages - 25 years or would they have ended at some point?

They are pay as you go and continue until you cancel the direct debit.

Orcaorca

Good to know what your thoughts are thanks

I know LV was a seperate company. Its LV I am going through.

If we took it out as a single policy to cover a joint loan - would we have been paid ?

Is the case in all mppi's that they pay even though you have cover via your employer or does it depend on your agreement?

Would these policies have paid out for redundancy?

In terms of our Nationwide ppi we did feel that we sort of 'had to' take the policy out becuase we were told we were first time buyers and the company prefers it. This was a face to face conversation so no proof other than our word.

It would be good to get our hands on the policy as we really dont understand what would and would not have been covered.

dunstonh

I know LV was a seperate company. Its LV I am going through.

I didnt think LV had any agents for the last decade or so. Their product was either intermediary or direct (direct as in non-advised phone/internet sales where you bought the product. This gives you less consumer protection and therefore less reasons to use when making a complaint). On what basis is your complaint to them?

If we took it out as a single policy to cover a joint loan - would we have been paid ?

Yes. It is very common to do single plans with joint mortgages. (one worker, one staying at home for example)

Is the case in all mppi's that they pay even though you have cover via your employer or does it depend on your agreement?

Yes it it.

Would these policies have paid out for redundancy?

That is largely the point of the unemployment/redundancy cover.

In terms of our Nationwide ppi we did feel that we sort of 'had to' take the policy out becuase we were told we were first time buyers and the company prefers it. This was a face to face conversation so no proof other than our word.

1 - There is no evidence to support your allegation (easy rejection for them)
2 - Your feelings are not something that can be complained about. There has to be something that points towards a wrongdoing. Feelings are not enough.

Another thing to note is that Nationwide frequently ran a 12 months free cover campaign for MPPI. At the end of the 12 months, they invited you to cancel it or do nothing if you wanted to keep it. Was yours one of these?

It would be good to get our hands on the policy as we really dont understand what would and would not have been covered.

MPPi is pretty generic across the providers. That is why it is so easy to answer your questions. Loan and credit card PPI has a lot of variations and tends to be much lower quality. This is why most loan and credit card PPI complaints get upheld but most Mortgage PPI complaints fail. Today, you can still buy MPPI. It is one of two types of PPI still retailed. It is considered more important as you are covering a debt with lifestyle changing consequences if it goes unpaid. Its not covering short term unsecured debts with limited consequences if they go unpaid. When you read the FOS decisions, you frequently see them treating MPPI as a more important thing than they do with Loand or credit card PPI.

Orcaorca

Ok thanks again interesting reading your views and opinions - many thanks.

Yes we phoned LV and took the cover out- we were both working at the time.

I shall look into these points further with the companies.

Turns out I also had ppi on a credit card I had no idea about.

I appreciate your opinions and your time.

Thanks again