MBNA Payment Protection

[the main man]

Hi,

I wonder if someone could advise me if the PPI is correctly formatted on this loan agreement that was taken out in 2004?
I am in dispute with them and have canceled it as I am self employed, the original amount for it was £634 + interest when I rang they wouldn't give me a rebate figure until I had canceled it and they have now informed me my account has been credited with £124.00(which seems very low) this loan is on month 34 of 60.
Any thoughts would be greatly appreciated.

http://i172.photobucket.com/albums/w...BNALOANAGR.jpg

[hellhasnofury]

Originally Posted by the main man

Hi,

I wonder if someone could advise me if the PPI is correctly formatted on this loan agreement that was taken out in 2004?
I am in dispute with them and have canceled it as I am self employed, the original amount for it was £634 + interest when I rang they wouldn't give me a rebate figure until I had canceled it and they have now informed me my account has been credited with £124.00(which seems very low) this loan is on month 34 of 60.
Any thoughts would be greatly appreciated.

http://i172.photobucket.com/albums/w...BNALOANAGR.jpg

Sorry, I can't make out the agreement the writing on the copy is too small

can you make it bigger

[reidnet]

HI,
By what I can make out on your agreement the way that the PPI cost was qouted was within the regulations at the time, PPI only became fully regulated after Feb 2005. Now they have to show the PPI cost and the Cost for Credit of the PPI as a seperate Item. Hope that clears that bit up for you.

Next,
The refund that they have given you will have been worked out in a weird and wonderful way by them, They tend to state that the PPI is more expensive at the start of the loan as it carries higher risk, what they mean is that there is the risk that if you make a claim they will, if they cannot wriggle out of paying out somehow they may have to pay out on the insurance.

The way they always state that the PPI will cost you £x.00 per month is not a true reflection of what actually happens, With a single premium insurance policy what they are in fact doing is advancing you the PPI premium as a loan and of course adding interest to this. The whole insurance premium is paid upfront to the insurance companty at the start of your loan, well the premium less their Commision (which in some cases can be as high as 90%) is paid to the Insurance Company.

If they state to you that a single payment protection insurance policy will cost you £x.00 per month they are simply misleading you on that one.

What you need to do is calculate the real cost of the Insurance policy that they sold you, You need to take the Policy Cost and add interest at the contracual % APR over the loan period.
(if you need help with this let me know and I will work it out for you).

An example of the real cost in my case was a 5 year Policy on a 15 Year loan (Rip off to say the least), where the policy cost approx £3000 but when I calculated the Interest on that over the 15 years it amounted to nearly £4500 in Interest making the true cost of the 5 year policy nearly £7500.00.

Now if I had taken PPI through an Independant Insurance Co I could have covered the PPI for 5 years for a total cost of £720.00, under one tenth of the cost which is absoluatelly disgusting. Maybe that is why I am fighting so hard over PPI and trying to make the general public aware of this massive scam. Personally I have nothing against PPI policies if they are sold properly and not at the highly inflated rip off prices that the Majority of High Street lenders sell it at.

Ian