Thread: First plus PPI - What do I do???

Hello annpan,

was this a secured loan?

Do you have an address for first plus and do you have the original Consumer Credit Agreement and any other paperwork/documentation on the loan, statements etc?

Originally Posted by annpan79

Hi,

In May 2004 I took out a loan with First Plus for (around) 35000. At the time I was advised t o take out the PPI (mis-selling) and took them up on the offer. I believe I was missold this because they didn't ask about pre existing conditions, (mis-selling again) didn't tell me it would be added to the loan (currently standing at 54k) (That makes for three reasons for mis-selling) and didn't tell me it would only last for 5 years (Number four ) (its a 25 year loan). The only mention of 5 years was 'if you don't claim in 5 years we'll give you 10k back', no other ifs, buts or maybes.

Well now the 5 years is up, and they wrote to me recently to advise me that I have 1 month (from the expiry date 1/6/09) to reclaim my 10'000 pounds. My question is, can I reclaim this money (i think they may turn me down because I missed one payment - something they never mentioned in the original call but detailed in the letter they sent) and still reclaim back the interest etc etc. (My guess would be that this is what they will try and do. Fob you off from getting any rebate) You will also have to work out what you have paid over the five year period with the interest compared to what you are likely to receive in rebate

I'm not sure which way to go. If i reclaim my 10k and they actually do pay me out - does that mean I can't claim back the rest of the money owed (interest etc). I am uncertain if you receive a 5 year rebate whether you could then proceed to reclaim the PPI mis-selling route. IMO probably better to post up your agreement with the figures but with all of the personal stuff like names, addresses, post codes, telephone numbers, account numbers, sort codes removed. CAG would be able to have a look and perhaps offer more personal advice. (This would be a decision you alone would have to make, whether to accept the rebate or cancel the PPI (probably worthless anyway) and reclaim all of the payments made plus the contractual interest added to those payments and the 8% statutory interest the Courts or indeed the Financial Ombudsman Service would add if your complaint were successful. Currently the fos success rate is high about 90%.

Any help would be most welcome.

Thanks

Ann

Have posted above the general idea is you make the call on balancing any 5 year rebate against what you have paid plus any cancellation rebate. If you cancel and you should get a rebate you can then claim all premiums paid plus contractual interest and 8% statutory interest that would be awarded by a court in the event you win the court action or it will be added on by the FOS if your complaint is upheld.

However you approach this you must make sure if you cancel existing PPI that you have cover in the event of sickness. You can do this by googling the subject or visiting moneysavingexpert website or perhaps your employer has sufficient cover.

Remember the insurance only covers you for 5 years and withing that period would only cover you for a period off work of 12 months.

What a useless and expensive product but it made massive profits for the banks etc.

aa

Originally Posted by annpan79

Hi,

Unfortunately I dont have scanner but i have a copy of the agreement which more or less goes like this;


Amount of advance : 47,000
Optional PPI : 9,367.10
Total Loan : 56,367.10
Monthly interest rate: .869%
APR : 10.9%

No of repayments : 300

Monthly Payment : 529.31

Then there is a paragraph at the bottom for the PPI;

Payment Protection

You have opted for ppi (which is ticked yes)

All the Ts & Cs are at the back etc

My maths is hopeless and wouldnt even know where to begin working out what the total interest paid on the PPI is or even what the monthly premium for ppi alone is i'm afraid!!!

Thanks for your advice, i think i may well be claiming the full amount!

From what you post I believe your Consumer Credit Agreement may be unenforceable as the loan and PPI seem to have been amalgamated. You will need to post you information to these threads for more expert advice on the legallity of the Consumer Credit Agreement.

Is My Agreement Enforceable - Useful

Multiple agreements falling within section 18 CCA 1974

hope these help you further on the agreement. However it would be better if you could get it scanned or presented to the thread for closer scrutiny.


aa

From memory they wouldn't pay out if you were more than 2 months in arrears, and if they do pay out you would only get the initial cost back.
The interest added is split over the 25 year period, so you would still be paying for the interest on it.
If you reclaim as missold, you should be able to get all the contractual interest off it and may get statutory interest on top.
See if you can find the original booklet they should have given you which details the criteria for claiming back and let us know how you get on.
(My opinion only.. .. )
Hope you get some further feedback.
Best regards

Hello annpan,

Think my PC is playing up - for some reason I can't attach the files on here (they're PDF, the only way I could scan them)

Here is a link to my sky drive though, they're the two documents in there;

Public - Windows Live

I have also drafted the below letter from templates on here - what do you think?

I purchased the above policy from you in [insert date] but now believe that I was mis-sold this policy for the following reasons:

Due to the fact that your member of staff did not ask me about any previous medical conditions and they did not inform me of the effect this could have on the insurance when the policy was sold.

Due to the fact that you have been fined by the FSA for failing to treat your customers fairly when selling Payment Protection Insurance and I do not believe that my policy was sold in my best interests.

Due to the fact that I paid a single premium for my policy which was included in the loan application. I believe this to be in breach of section 18 of the the Consumer Credit Act 1974 in that it is a multiple agreement ( “part of it within one category of agreement mentioned in this Act, and another part of it within a different category of agreement so mentioned, or within a category of agreement not so mentioned”). Therefore since this type of agreement falls within s18, it means that as defined in s18 (2) CCA that the document is to be treated as 2 separate agreements and each agreement must have its own prescribed terms for each part. The agreement I have does not have prescribed terms for both parts (loan and Payment Protection)

I have tweaked your letter a bit see below hope you don't mind?

The first part having looked at your Credit Agreement is fine I believe the Loan and PPI should have been separate issues and on your agreement they clearly are not!

This is due to the fact that your staff failed to provide the correct information when the policy was sold to me, as

Your salesperson was very pushy and applied a disproportionate amount of pressure to ensure I agreed to the policy. This pressure selling put me at a distinct disadvantage so that I felt I could not say no.
Your salesperson failed to inform me that the policy was optional and I have since realised that I have alternative insurance cover.
Your salesperson did not give me comprehensive details on the full information as to what the policy would and would not cover, for example that the loan only covered the first five years of my loan term.
I am concerned the sales assistant that sold me the policy has no financial background and the policy was not sold in my best interests.

Unless you can satisfactorily justify to me that the policy was fair and reasonable I am requesting a full refund of all premiums, and subsequent interest on these payments, that I have paid to date. As I believe I have been deprived of this money I will also require 8% statutory interest, the amount a court would award, to be added to each payment made.

I look forward to a full and prompt response to this letter and for the matter to be concluded within eight weeks or I shall be contacting the Financial Ombudsman to submit a formal complaint into this matter.

This is how I complained to the RBS.

1. Responsibilities When Underwriting a Policy of Insurance: On each occasion, when the details of a loan were discussed Your sales advisors failed to check my personal circumstances at the time of the sale, which they are under obligation to do when underwriting a Policy of Insurance. If they had done so, they would have realised that the PPI policies were useless to me. At no time was any attempt made to ascertain if the product provided was fit for purpose, suitable for my needs or if indeed it was required at all.

2. Alternative Insurance Cover: Your sales advisors in each case failed to ask me if I had any alternative arrangements for insurance cover. My employer has a generous illness package which would cover a period of sickness as follows: 6 months full pay followed by 6 months half pay. I would also be entitled to a generous redundancy package and a substantial payment would be made in the event of my death in service (more than suffice to clear the balance of the loan).


3.Failure to Supply Important Information with Regard to Significant Policy Exclusions: I was most definitely not informed that the PPI policies could contain certain exclusions which could affect me and my ability to claim on the policies if I should need to. Additionally I was never told that Pre Existing Medical Conditions could invalidate my policy and I was never asked if I had any Pre Existing Medical Conditions. Indeed your Loan Customer Duty of Care Checklist and the Loanguard Certificate of Insurance to which the Customer Duty of Care Checklist refers (forwarded under cover of Reference N) contain no reference to any Pre Existing Medical Conditions or includes any questions to me on the subject. I am in fact in receipt of a 40% War Disablement Pension from Her Majesty’s Government (HMG) since 1991. One element of this pension includes back injury which I now know is an exclusion in your PPI Policies. I also believe that I would also be excluded on at least one other existing condition.

4. Widespread PPI Mis-Selling: I cancelled the PPI policy on xxxAccountNo xxx on 7 Jan 2007 after becoming aware of the widespread mis-selling of PPI by some financial institutions, following recent media coverage and recent OFT and FSA investigations regarding the mis-selling of PPI. I believe this is borne out by Point 3 above. I am also aware that the question of PPI cover is the subject of an ongoing inquiry by the Competition Commissioner.

5. Wholly Inappropriate PPI Selling Bonuses: I understand that some employees are paid higher bonuses if they get prospective creditors to take out PPI with loans. How can the best interests of the customer possibly be met, if there is a clear conflict of interest between your responsibilities to me, and the drive of your employees to sell Payment Protection Insurance whether it is suitable or not in order to receive bonuses?

6. PPI Loan Interest payments miscalculated: Since I cancelled the policy, I have actually received a smaller reduction in the PPI loan interest payments than the figure stated on the agreement. The explanatory letter sent to me has, I believe, confirmed that I have paid for single premium PPI policies on each loan taken with your establishment.

7. True Nature of Single Premium PPI Not Explained: No explanation was forthcoming from any advisor on any occasion on the full extent of single premium PPI policies or the fact that they would offer little or no refund if the loan was settled early or if the insurance was cancelled. The statements you have forwarded on accounts xxx and xxx, show no element of any refund of PPI or PPI interest when the accounts were settled on refinancing. There was also no explanation that the cost of the PPI premium would be added to the total cost of credit and interest added for the full term of the agreement. I believe this practice is unlawful.

I now believe that the single premium PPI policies attached to the loan accounts were both extremely unfair and totally unreasonable and offered me very little, if any protection value whatsoever. I am therefore requesting a full refund of all costs including all single PPI premiums that have been paid, the interest added to these premiums and the payments, that I have paid to date.

Furthermore as I believe I have been unlawfully deprived of this money, I also expect the repayment of the interest at the Statutory Interest rate of 8% applicable to of each of the single premiums.

Post 96 in this thread...***RBS PPI Claim Long fight but, WON***


Hope this helps

aa

Widespread PPI Mis-Selling: Following recent media coverage and recent OFT and FSA investigations regarding the mis-selling of PPI and also that the question of PPI cover has been the subject of an inquiry by the Competition Commissioner. My understanding is that the Competition Commissioners Office have ruled that PPI has been widely mis-sold and indeed the result is that single premium PPI sales have been banned. Additionally all other PPI sales must allow a 14 day period for consideration and cannot be added on at the point of sale with the loan. I do not believe that my policy was sold in my best interests.
I also believe that your company itself has been fined by the FSA for failing to treat your customers fairly when selling Payment Protection Insurance.

True Nature of Single Premium PPI Not Explained: No explanation was forthcoming from any advisor on any occasion on the full extent of single premium PPI policies or the fact that they would offer little or no refund if the loan was settled early or if the insurance was cancelled. There was also no explanation that the cost of the PPI premium would be added to the total cost of credit and interest added for the full term of the agreement. I believe this practice is unlawful and in breach of section 18 of the Consumer Credit Act 1974 in that it is a multiple agreement ( “part of it within one category of agreement mentioned in this Act, and another part of it within a different category of agreement so mentioned, or within a category of agreement not so mentioned”). Therefore since this type of agreement falls within s18, it means that as defined in s18 (2) CCA that the document is to be treated as 2 separate agreements and each agreement must have its own prescribed terms for each part. The agreement I have does not have prescribed terms for both parts (loan and Payment Protection)

Wholly Inappropriate PPI Selling Bonuses: I understand that some employees are paid higher bonuses if they get prospective creditors to take out PPI with loans. How can the best interests of the customer possibly be met, if there is a clear conflict of interest between your responsibilities to me, and
the drive of your employees to sell Payment Protection Insurance whether it is suitable or not in order to receive bonuses?

Alternative Insurance Cover: Your sales advisors in each case failed to ask me if I had any alternative arrangements for insurance cover. My employer has a generous illness package which would cover a period of sickness as follows: months full pay followed 75% salary for the remainder of the illness. I would also be entitled to a generous redundancy package and a substantial payment would be made in the event of my death in service (more than suffice to clear the balance of the loan).

Wholly Inappropriate PPI Selling Process: Your salesperson was very pushy and applied a disproportionate amount of pressure to ensure I agreed to the policy. This pressure selling put me at a distinct disadvantage so that I felt I could not say no. Also your salesperson did not give me comprehensive details on the full information as to what the policy would and would not cover, for example that the loan only covered the first five years of my loan term. Your sales person also did not ask me about any previous medical conditions and they did not inform me of the effect this could have on the insurance when the policy was sold. In addition I am concerned the sales assistant that sold me the policy has no financial background and the policy was not sold in my best interests.

I have been in touch with the Financial Ombudsman service and have been advised to lodge a formal complaint with you in the first instance. As this policy has reached its 5 year expiry date I have applied to the insurers for a refund of the original payment protection premium (less insurance premium tax), to which I am entitled to (as advised by the Financial Ombudsman Service) and that I fully expect to receive. Unless you can satisfactorily justify to me that the policy was fair and reasonable I am requesting a full refund of the insurance premium tax, and subsequent interest on each payment, that I have paid to date for the insurance premium. As I believe I have been deprived of this money I will also require 8% statutory interest, the amount a court would award, to be added to each payment made. I also require you to correct my account to reflect that no insurance premium has been paid and return it to the state it would normally be in had the insurance not been added to the account from the onset of the loan. I would also expect my monthly premiums to be reduced accordingly.

I look forward to a full and prompt response to this letter and for the matter to be concluded within eight weeks or I shall be contacting the Financial Ombudsman to submit a formal complaint into this matter.

Does that all seem OK?

I've been trying to work out how much I could get back - if any!! Well, I should be guaranteed 10k at least (i know I have not been 3 months in arrears which is what is on the T&Cs). Do you know of any calculators available to figure it out? I've done a little spreadsheet and it comes out at about 24k - As below;


Year 1 10,000 plus 10.9% interest & 8% interest = 11890
Year 2 = 11890 plus 10.9% interest & 8% interest = 14137.21
Year 3 = 14137.21 plus 10.9% interest & 8% interest = 16809.14
Year 4 = 16809.14 plus 10.9% interest & 8% interest 19986.076
Year 5 = 19986.07 plus 10.9% interest & 8% interest = 23763.43

Does that seem right or is there a better way to do it/am I way out?

I'm assuming I either have a choice, if I want 23k - which would be nice, they would have to leave the premium on the loan. But if I was OK to settle for 14k then they would knock the premium off the loan and reduce payments accordingly???

Thanks for all your help!!



Ann

I have tweaked again in red. Pompeyfaith is the best man on spreadsheets and my be able to help if you ask.

See this also on the Competition Commissioners findings on PPI...

Current inquiry by the Competition Commission into PPI - PRELIMINARY FINDINGS
http://www.competition-commission.org.uk/inquiries/ref2007/ppi/provisional_findings.htm

Final result of the Competition Commission inquiry
http://www.competition-commission.org.uk/rep_pub/reports/2009/542ppi.htm

hope this keeps you on track

aa