PPI Reclaiming discussion Part II

di3004

marshallka wrote: »

I don't know then. Would you say this is how they are worked out. I just don't know. There must be a way of doing this. I will carry on looking at tiggraes posts from when she worked them for people.

That is what I have been doing - going right back in the old posts, because I am sure M Colak has said something about the calculations and how they worked at them but it was a while ago and I cannot remember for the life of me of when I first mentioned this on here, maybe in July, but its doing my head in for looking.....:o

marshallka

We have compiled a list of what policy the main lenders operate:

Nationwide – Need to cancel the loan and refund calculated using Rule of 78. Bank says customer will receive 37% of premium back if they cancel two years into a 60-month loan.

HSBC - Need to cancel the loan and refund calculated using Rule of 78. Cancel the plan a third of the way through and HSBC says you will receive around 38% back. Half-way through, you'll get 20% and two-thirds, 8%.

NatWest - Can be cancelled separately, interest penalty incurred.
Northern Rock - Can be cancelled separately with no impact on the loan. In the case of unsecured personal loans, as long as customers have not made a claim, refund is based on Rule of 78.


Lloyds TSB - Need to cancel the loan and refund calculated using Rule of 78. A £45 fee applies.

Barclays and Barclaycard– Can be cancelled separately, but refund will not be issued on a pro-rata basis. If half of the loan term has expired, the customer would receive just a quarter of the premium back. Barclays says that customers may have to have a new loan agreement, but depends on individual cases.

Alliance & Leicester – Can be cancelled separately. A&L says: 'A customer can choose to cancel their loan protection at any time - if it is after the initial 30 day cooling off period they would be given a refund for the unused part of their policy. There is a small charge of £10 to cover the administration of the policy cancellation.'

Abbey - Need to cancel the loan and refund calculated using Rule of 78.

Halifax – Can be cancelled separately without cancelling loan. However, loan repayments will remain unchanged unless new loan taken out.

Egg - Need to cancel the loan and refund calculated using Rule of 78. If you cancel a quarter of the way through, you'll get just 56% of the premium back.
Tesco Personal Finance – Can cancel the loan separately and loan repayments are renegotiated to reflect new rate.

marshallka

Found it


The rule of 78 rebate method treats the insurance premium as ‘front loaded’ (ie a higher proportion of premium is allocated to the earlier periods of the policy). If a policy is cancelled part of the way through its term, the rebate payable therefore represents a lesser proportion of the full single premium than the unexpired term bears to the full term of the policy. Figure 1 shows the percentage of the initial premium that is given back to customers cancelling the PPI during the term when the rule of 78 is used to calculate the rebate. The example is based on an HSBC17 PPI policy with an initial premium £846.49 covering a £5,000 loan over a 36-month term. In some cases, certain providers charge an additional retained premium on cancellation of policy in calculating the rebate payable (for example, one distributor ([ ]) retains up to a further two months’ premiums beyond the cancellation date when calculating the rebate due).

Di, this explains it here
http://www.competition-commission.org.uk/inquiries/ref2007/ppi/pdf/prov_find_app_5_2.pdf



That is why, Firstplus front end load them as well. That is why its so unfair.

di3004

marshallka wrote: »

Found it


The rule of 78 rebate method treats the insurance premium as ‘front loaded’ (ie a higher proportion of premium is allocated to the earlier periods of the policy). If a policy is cancelled part of the way through its term, the rebate payable therefore represents a lesser proportion of the full single premium than the unexpired term bears to the full term of the policy. Figure 1 shows the percentage of the initial premium that is given back to customers cancelling the PPI during the term when the rule of 78 is used to calculate the rebate. The example is based on an HSBC17 PPI policy with an initial premium £846.49 covering a £5,000 loan over a 36-month term. In some cases, certain providers charge an additional retained premium on cancellation of policy in calculating the rebate payable (for example, one distributor ([ ]) retains up to a further two months’ premiums beyond the cancellation date when calculating the rebate due).

Di, this explains it here
http://www.competition-commission.org.uk/inquiries/ref2007/ppi/pdf/prov_find_app_5_2.pdf



That is why, Firstplus front end load them as well. That is why its so unfair.

I will get back and have another look in a min, thanks for all this hun, am having a quick shower to clear my head and will be back.;) x

marshallka

This is a good comparative tool from the FSA

http://www.fsa.gov.uk/tables/bespoke/PPI

Pantheon_2

Hi guys
I hope you don't mind me interrupting. I've just read through all of the psots, and spent ages replying to maxdb's question,and then lost it all before I could post it.

Thank you for the support and fantastic information you all posted this afternoon.

David

I'm going to do my reply and paste it,hopefully I won't lose it again lol.

marshallka

Di, ours was front end loaded too that is why even if they repay the rebate amount of the PPI that was unfair the loan still cost us more than we borrowed. That is the difference. I posted some figures above and if you got back your rebate then you would have actually paid less for the loan than you originally borrowed. If I got my amount back they still would have made money out of us. I just could not understand why. If you read about front end loaded policies then this is the reason why they are unfair. All your repayments go towards the policy in the beginning and then nothing comes off the capital.

Did tiggrae ever look at your figures here. Perhaps you could ask her how these are worked out. I don't want you to ask the FOS for that amount back or Endeavour as it does not work out with your loan and PPI. I know when I asked about it and today on the phone to the FOS I was told that they don't work it specifically they just look at the way it was rebated and mine was rebated and the use of rule 78 used in the calculation of the rebate and it was front end loaded.

I just don't understand how they work them out and if you have to prove the rebate was unfair then how do you do this . I know front end loaded are unfair - how would the FOS think they were unfair. How do they calculate them.

I think we need to ask tiggrae about this again. I was told by FOS today "were you happy with your rebate" and I replied "no" the PPI acually cost me £9K and I got £90 back. She then made me feel quite confident.

marshallka

Pantheon wrote: »

Hi guys
I hope you don't mind me interrupting. I've just read through all of the psots, and spent ages replying to maxdb's question,and then lost it all before I could post it.

Thank you for the support and fantastic information you all posted this afternoon.

David

I'm going to do my reply and paste it,hopefully I won't lose it again lol.

Hi David, nice to see you posting again. Maxdp did say to remind you to look at the posts she had left. They may be of help in the loan being missold. Hope they do help but don't try to understand what I am on about now as this is beyond all of us and my head is done in now . (and maybe I have done Di's in too - she will be ok though as she knows what I am like when I get a bee in my bonnet)

marshallka

di3004 wrote: »

Yes that's right !!

Now they should really move on with yours now, because its not your fault it was thrown back at you and if they had dealt with this one earlier then I'm sure it would have been sorted out by now.......:rolleyes: !!!

It was my fault DI. I worded it all wrong cause I did not understand. All I knew was something was drastically wrong with the amount we repaid to them.

di3004

Pantheon wrote: »

Hi guys
I hope you don't mind me interrupting. I've just read through all of the psots, and spent ages replying to maxdb's question,and then lost it all before I could post it.

Thank you for the support and fantastic information you all posted this afternoon.

David

I'm going to do my reply and paste it,hopefully I won't lose it again lol.

Hi there
And good to see your back and you have not interupted at all, you post anytime hun, we are here most of the time lol.....:D , your very welcome and good luck with everything.:beer: .