MPPI Halifax

stubbo6376

Good afternoon,
I have a current case ongoing with Halifax regarding a Homeowner loan that was taken out in February 2001 and ran until October 2003. The loan was secured against my property and was paid off in full in the October of 2003 when the house was sold. I was told by Halifax 8 weeks ago that PPI had been added to it, so naturally a complaint was raised. After giving very limited information to Halifax, because of the timeframe of the initial loan they investigated and found no wrong doing. After hours of searching previously unknown paperwork we found evidence of savings, shares held, and house sale invoices to show our financial situation. Our current mortgage at the time was an endowment and had insurance products running alongside to offer securities for illnesses/death etc.. We have never asked for PPI/MPPI and are arguing the complaint on our financial suitability with said savings, shares, insurance policies in place. Currently waiting a further investigation..any ideas on strengths of our points:money:

[Deleted User]

Sounds like your complaint has already been rejected and that you are wasting your time going back to them because you have failed to find any concrete evidence of mis-selling that won't have already been considered. Critical Illness and Life Assurance have no overlap with Mortgage PPI.

You are just going receive a terse reiteration of your original rejection.

If you feel that your complaint has been unfairly rejected, the next stage of the complaint should be to refer it to the Ombudsman. You have only six months from the original rejection in which to do this.

dunstonh

I was told by Halifax 8 weeks ago that PPI had been added to it, so naturally a complaint was raised. After giving very limited information to Halifax, because of the timeframe of the initial loan they investigated and found no wrong doing.

Why was it natural that you complained?
MPPI is a valid product that you can still buy today. It's not one of the bad types of PPI. So, there is nothing natural about complaining about it. Both the firms and the FOS reject most MPPI complaints.

After hours of searching previously unknown paperwork we found evidence of savings, shares held, and house sale invoices to show our financial situation.

Investments are long term and not short term. If you had the money, why did you have the mortgage?

Typically, at point of sale (which is the only date that matters), you need to have around 2 years income in cash savings to stand much chance of getting a complaint rejected on financial need.

We have never asked for PPI/MPPI and are arguing the complaint on our financial suitability with said savings, shares, insurance policies in place. Currently waiting a further investigation..any ideas on strengths of our points

We do not have the benefit of audit trail and sometimes banks roll over easily. Halifax have been one of the easiest to get payouts on. So, with that caveat in mind, there appear to be no real strengths in your complaint.
1 - you are complaining about a good type of PPI. Not a bad one.
2 - it is a long term secured debt with lifestyle changing consequences if it goes unpaid (and I pinched that wording from a FOS rejection). So, insurance is common sense.
3 - it is unclear how much cash savings you are referring to but that rarely works as the mortgage is not your only need if you lose your job or unable to work. It only tends to work with significant cash savings which could cover multiple years.

stubbo6376

The statements I have provided show savings of £5k and share dividend of £7k, my mortgage was an endowment as stated and had life insurance plus critical illness cover, two policies running separate in payment terms but both to cover a mortgage of £42k. My complaint of mis- selling PPI was made through a CMC with Halifax acknowledging that PPI had been added to a loan. Later I found the paperwork on this loan which was in fact a Halifax homeowner loan that was secured against the property, so effectively a mortgage. After receiving their letter this week stating no cause for not being eligible, suitability, or financial worries they said any further information I had was asked for. As I said I found past financial records showing assets/savings held and stated I was not reliant on insurance policies to cover my loan/ mortgage. Received a letter today saying there was further investigation being carried out, but they had changed their initial wording of PPI being mis-sold to saying it was MPPI, I will lodge my case with the ombudsman.

[Deleted User]

stubbo6376 wrote: »

The statements I have provided show savings of £5k and share dividend of £7k, my mortgage was an endowment as stated and had life insurance plus critical illness cover,

As already stated, Life and Critical Illness policies have no overlap with mortgage PPI.

£5K in savings does not indicate that you had no need of the insurance either. If you were made unemployed you would have other demands on your finances, not simply the mortgage payments.

Could you have easily and immediately accessed your share dividend? Even if you could, it's still not a large enough sum suggesting that you had no financial need for the insurance.

Again, most mortgage PPI complaints are rejected and the insurance is still being retailed today.

stubbo6376 wrote: »

My complaint of mis- selling PPI was made through a CMC with Halifax acknowledging that PPI had been added to a loan.

You appear to believe that there was something inherently wrong with the insurance but the truth is that, while (some) PPI was widely mis-sold, MPPI is still a useful and recommended insurance.


You also infer that the insurance was simply "added" to your mortgage without your full knowledge and agreement. This would not have been the case.

Halifax "acknowledging" that you had PPI is not an admission of any wrong-doing!

dunstonh

The statements I have provided show savings of £5k and share dividend of £7k,

So way below the level that is considered enough to not have MPPI.

my mortgage was an endowment as stated and had life insurance plus critical illness cover, two policies running separate in payment terms but both to cover a mortgage of £42k.

Endowment does not overlap with MPPI. So, no issues there.

After receiving their letter this week stating no cause for not being eligible, suitability, or financial worries they said any further information I had was asked for

Out of everything, this is where most MPPI complaints are measured. Eligibility and suitability.

As I said I found past financial records showing assets/savings held and stated I was not reliant on insurance policies to cover my loan/ mortgage.

You may state that but its not a fact. Typically, you are looking at 2 years income or more. You have to be way below that with your amounts.

I will lodge my case with the ombudsman.

Dont get your hopes up. The FOS reject most of them too. Based on what you have said, there appears to be no wrongdoing. Of course, we dont have the audit trail or info to hand but if it truly reflects what you have said here, then you would not expect the complaint to be upheld.

There are plenty of published ombudsman decisions on MPPI to know how they are going to look at.
such as:
http://www.ombudsman-decisions.org.uk/viewPDF.aspx?FileID=138660

You need to remember that you are making an allegation of wrongdoing. There is absolutely nothing wrong with having MPPI. It's not like loan or credit card PPI. Which is why you can still buy MPPI today (one of only two types of PPI you can still get). There is no product failing with this MPPI (which is where many types of loan PPI fail and why most loan PPI complaints succeed).

stubbo6376

I have stated that I didn!!!8217;t rely on the insurance policies in place to cover this loan as they were taken out to cover my endowment mortgage. My point is that this additional borrowing for home improvements carried PPI which if all suitability checks would of been done why was it deemed right for me. The loan was for £10k and as stated we had share dividend to the time of £7k which could be cashed in at any time. Surely any consumer credit agreement would highlight costs and look into affordability, and what measures where in place for such an event as unemployment or illness. Further to that what type of MPPI was asked for as it came in many forms to cover unemployment,illness, loss of earnings. If a new customer now had savings and assets in shares worth in excess of the amount wanted to loan, would advice still be given on taking out protection.

[Deleted User]

stubbo6376 wrote: »

If a new customer now had savings and assets in shares worth in excess of the amount wanted to loan, would advice still be given on taking out protection.

Since being able to claim on an insurance policy would negate the need to rely on such savings then the insurance would still be recommended.

Having already been rejected, I think you are going to struggle with this.

Good luck at the Ombudsman.

dunstonh

If a new customer now had savings and assets in shares worth in excess of the amount wanted to loan, would advice still be given on taking out protection.

Yes it would. As the point made a number of times now is that you are looking at having sufficient savings to cover all your expenditure for a few years. Not just the loan in isolation.

You seem to think that the low level of savings you had is enough. It is not enough. Any shortfall allows an insurance policy to be put in its place. As noted from the FOS decision (and that is just one of many), they look at the savings as a ratio of income. So, how did your £5000 savings stack up against your total household income? (you and spouse/partner)

stubbo6376

It seems your suggestion that having savings, assets, employees benefits and a joint income of circa £40k pa was still not enough to be classed as unsuitable for the policy. I respect your opinion in any of these points but can anyone really point to a conclusion, it’s also for them to make their case and you guys are just financial advisors and not financial investigators.

[Deleted User]

stubbo6376 wrote: »

can anyone really point to a conclusion

Well, the "conclusion" is that the Bank have already rejected your complaint and the Ombudsman is likely to do the same.

On a positive note, you won't have to pay fully a third of your redress (plus VAT) to your Claims Management Company!

Happy for you to return and tell us of a different result.