Help calculating ppi refund

HaggisANDspuds

I filled out form via Resolver for loan with Lloyd’s.

Lloyd’s called me last night when I was still working - said that I had ppi on a £5000 loan taken out 20/6/01 - PPi was front loaded and was approx £1400. He said that they will write to me giving details of my refund along with interest and 8% added on .......then my boss called me and I had to go!

My loan was over 5 years - my total monthly payments were £143 and I don’t know what the apr was.

I am so excited about a refund as I’m going to Memphis in January and been working two jobs for it!! Can anyone give me any idea a rough guide to what I can expect to receive back?

HaggisANDspuds

Sorry my loan was over FOUR YEARS

Nasqueron

You get a refund of premiums and standard 8% simple interest

It's a defined refund process, there is no haggling or debate on the amount they offer, you get a fixed sum following the calculation process defined by the regulator.

https://www.financial-ombudsman.org.uk/publications/technical_notes/ppi/redress.html#compensation

There are calculators online if you want to plug the numbers in but I wouldn't count on the money until it's in your bank.

HaggisANDspuds

The call was to tell me I am getting a refund of the ppi - I am excited and as I had to end the call a little early due to my boss coming in - He said I’ll get all the details via post so I just need to be patient.

So the ppi was approx £1400 and then 8% of that so I will hopefully get around £1500? I am delighted with that as loan is 17 years old

foxtrotoscar_2

HaggisANDspuds wrote: »

The call was to tell me I am getting a refund of the ppi - I am excited and as I had to end the call a little early due to my boss coming in - He said I’ll get all the details via post so I just need to be patient.

So the ppi was approx £1400 and then 8% of that so I will hopefully get around £1500? I am delighted with that as loan is 17 years old

It's 8% for every year since you paid it...be prepared to party!

HaggisANDspuds

Omg OMG REALLY!!!!!

So a rough guide is 8% of £1400 = £112 x 17 = £1904 plus the initial payments of £1400 TOTAL £3304!?!?!?!? Seriously!?!? I am in total shock!!!

Thank you so much! I’ll be watching for the postie every day!

Nasqueron

It'll probably be around that yes, might even get more as there is usually a refund of the interest you paid on the PPI in the loan as well

where the consumer's PPI policy and loan had run their full term before the business calculated the compensation

what we know
you took out a loan of £3,000 over 3 years;
we added the cost of your PPI premium to your loan. That was £450, so your total loan was for £3,450;
you paid monthly payments of £110 per month for 3 years until your loan was repaid - a total of £3,960; and
your loan ended 2 years ago.

what we have calculated
if you had instead taken out your loan without PPI you would have paid monthly payments of £95 per month for 3 years - a total of £3,420.

what we will do
We will pay you the difference between the monthly payments you paid (£110 per month) and what they would have been without the PPI policy (£95 per month), which is £15 per month (or £540 in total). We will also add interest at 8% per year simple to each overpayment from the date it was paid until the date of settlement, which in this case comes to an additional £120.

The total we will pay you is therefore £540 plus interest of £120.

Dazed_and_confused

You might find they deduct 20% tax from the interest.

Depending on your personal circumstances in the year the interest is paid then it's possible you could get a refund of some of the tax or might owe HMRC an additional amount.

If you are a basic rate payer nowhere near higher rate tax (£45k+) then you may be eligible to have upto £5,999 interest taxed at 0% but if you are earning more than £16,850 then it s likely to just be £1,000 interest which can be taxed at 0%.