Thread: ppi refund cheque v loan offset

If you owe them the money, they're entitled to take it as an offset from the settlement.

If your up to date with all your payments on the card, then technically the returned claim is yours to do whatever you want with, it's your money after all. If however you've defaulted on the card, or the issuer has stopped you from being able to use the card then they are entitled to take any amount owing from your refund.

For example ... if you have a card with a £4500 credit limit, and you've got a £2000 balance on the card, your up to date with your payments, and you can still use the card, then they'll have to give you the money as a cheque. Because you've got a £2000 balance is irrelevant as you havn't broken any the terms of your contract so they have no right to deduct that £2000 from your settlement. If you have broken the terms of the contract (by defaulting the card for example), then they are entitled to take whatever you owe them from the settlement.
Im not sure about this, but if you've missed say 2 payments on the card, then they should only take the two payments off your settlement, but that could be a tricky scenario as far as the terms of their contract is concerned.

You should be fine getting a cheque then.
They should already be reducing the loan anyway, as the PPI will have to come off the payments, and / or the Total loan amount you owe if the whole PPI sum was added at the start of the loan.

So, if your in any arrears they'll take the arrears amount off the refund and will obliged to give you the rest.

You may need to be careful if they do offset, or insist on offsetting the amount against the loan, make sure the total interest added onto the loan is adjusted to reflect your lump sump payment ... and as you will have made a £4k lump payment you'll need to make sure that they don't add on any fees for that ... which wouldn't surprise me at all.

There doesn't appear to be any reason why they wouldn't give you a cheque though if that's what you asked for ... it's your money.
Let us know how you get on.

Originally Posted by gazza1234

Hi all,
This is my first post so I apologise if I'm in the wrong thread here.
I'm looking at some old loans and credit cards and trying to sort out the PPI claims on them. One lender has come back and agreed that I was mis-sold and agreed to refunding £4000 (hooray), however they have said that it would be deducted from my outstanding balance and the loan re-adjusted. I want payment as a cheque as I could do with the money right now. Am I right in saying that I can choose how I get the money? Any help would be greatly appreciated as I don't know how to reply to them (if I have the right to have it as a a cheque, is there anything I can quote or refer them to in order to back up my response)
Many thanks

My understanding is if you are in arrears on your loan they can use any refund to offset any debt. I am not a banana and I would contest this as the Loan figure and the PPI figure added to the loan should IMO be separate issues and any PPI refunded as mis-sold should not be used to pay off any arrears on the loan.

I would tend to insist on a personal cheque in your name on any mis-sold PPI.

Others would argue this issue.

aa

I would agree that I would request a cheque, however I would pay off any arrears if there are any, especially if it's a secured loan, obviously.