Advice re: LTSB Loan with PPI

[alanalana]

My mum and dad got a letter from LTSB yesterday saying that they were upholding their complaint and as such would

- organise repayment of the ppi of their previous payments towards the debt

- cancelling the ppi

- taking the amount of the ppi (around £4900) off the outstanding amount. (They should only take any arrears from any rebate they offer they should not use any ppi rebate to reduce the outstanding amount that is due)

- any interest accrued as a result of the ppi is being taken off too.

 

They have asked them to sign a form saying that they wish to cancel the ppi, and that they agree to LTSB terms - as above.

 

Are they OK to just send that off? (before they do check out any arrears due and only agree to the repayment of PPI covering the arrears amount not any outstanding amount) Having said that if there are problems with repayments it would be a wise move to reduce any debt by using any rebate to cut that debt. It could make life a lot easier on the repayment front.

 

The debt is now in default as they couldn't keep up payments, so how does this affect what is happening with that? They are being harassed by LTSB for the amount they owe, even though they simply cannot afford a thing towards it. Should we sort out the cancelling of the ppi so we have a better idea of the amount they now owe - it was a 15,000 loan that wasn't secured on anything.

 

We need to get LTSB to take a small token payment for the time being, or even write-off the debt...when they took out the loan, my mum had just started working but was fired due to having to take sick leave after a car accident. They could afford the loan when she was working, but after she was fired was when they got into trouble and now cannot afford to pay back.

 

If the account is in arrears then my understanding is LTSB can take the outstanding arrears from any rebate of the mis-sold PPI but they cannot use the rebate to pay off any remaining balance on the account other than any outstanding arrears.

 

You should cancel the PPI but they may do it automatically on accepting their proposals, but YOU MUST ENSURE you/they have an alternative cover in case of future illness. There are much cheaper options available. Google moneysavingexpert and see the website, there will be a tab for insurance and I am sure there will be something there on PPI insurance alternatives.

[Dodgy Geezer]

Why arent they claiming on the PPI policy to pay off the loan.?

[debtdeception]

In many cases the PPI does not actually provide the cover needed.

IMHO If LTSB are giving back all the premiums and the interest on the premiums then I would take it.

[sleepz]

Im not sure on this one as the account has been defaulted.

It depends how far it's been defaulted. If your still making payments (it looks as if your not) then you should be able to get the arrears taken off the PPI amount, and the difference sent to you as a cheque. However, if it has been defaulted because you are no longer making payments at all then they might be within their right to take the full amount off the outstanding balance.

If it's just been defaulted because you missed a couple of payments months ago and havn't been able to catch up on those payments then they should just take the amount of those missed payments and refund you the rest.

I think it depends on how / why the account was defaulted.

[thekat1979]

Thanks everyone.

 

They tried to claim on the insurance when she was fired, but that is when they found out that they had been mis-sold a policy that didn't cover them.

 

They were relying on my mum's income to ay for the loan, and got into trouble in December last year - 2008 - and were making part payments until February, when LTSB defaulted them for not paying the full amount, and have since been taking any amount they see fit from their LTSB current account that takes my parents to their maximum overdraft...then they are charging them interest on this.

 

They think that my mum agreed to a a repayment plan with them - she didn't she told them she would see what she could do to find as much as she could - its still with in house collections, althugh a default has been registered. They simply cannot afford to pay back the loan since my mum hasn't been able to get back to work since her accident, so they simply don't have the income they had before.

 

They can only just make rent and their other priority debts.

 

I need to find a way to help them,

[alanalana]

Thanks everyone.

 

They tried to claim on the insurance when she was fired, but that is when they found out that they had been mis-sold a policy that didn't cover them.

 

They were relying on my mum's income to ay for the loan, and got into trouble in December last year - 2008 - and were making part payments until February, when LTSB defaulted them for not paying the full amount, and have since been taking any amount they see fit from their LTSB current account that takes my parents to their maximum overdraft...then they are charging them interest on this.

 

They think that my mum agreed to a a repayment plan with them - she didn't she told them she would see what she could do to find as much as she could - its still with in house collections, althugh a default has been registered. They simply cannot afford to pay back the loan since my mum hasn't been able to get back to work since her accident, so they simply don't have the income they had before.

 

They can only just make rent and their other priority debts.

 

I need to find a way to help them,

 

The PPI was obviously mis-sold so you should:

 

1) get all the information using this information......

 

Letter templates here..

 

Full SAR for ppi and also here..

 

Data Protection Act 1998 - Subject Access Request

 

and be sure to ask for these:

 

You can be specific with what data you request although the Subject Access Request is really asking for everything. The Statutory fee is £10.00 Postal Order is fine but keep the details of the number for future reference. Send all correspondence by at least recorded to be signed for so you can track delievery through Royal Mail.

 

The things you should get from a Subject Access Request are:

 

True copies of your Consumer Credit Agreements (CCA) with the terms and conditions that were applicable to the agreement at the time the loan started.

 

Copies of all your statements.

 

Copies of all correspondence with regard to the loan, letter, fax, transcripts of phone calls or transcripts of phone calls, or other notes taken by them during the calls.

 

Also be specific in your request for full disclosure on any PPI added to the loans this should be identifiable on the CCA.

 

Specifically request the demands and needs/Customer duty of care questionnaire which should have been completed at the point of sale. This questionnaire should be filled out by the bank advisor to ensure all the relevant questions have been asked to ensure the product is fit for purpose and suitable to your needs. See this as an example.....

 

When you send your Subject Access Request you should ask for evidence of the questions asked at the point of sale.

Please see this link for an example:.....http://wwwa.mbna.co.uk/insurance/files/CP0608_INSU_MB_LP_S.pdf

 

The data requested should be data in any format that their organisation uses for filing, electronic, paper, microfiche, CD, Floppy, Magnetic tape.

 

Please have a read through the following links for further information.

 

PPI - Some Notes for Claimants..

 

For claims before 2005 and the FSA ruling from which campaign

How to tell if you’ve been mis-sold PPI

 

Quick check: were you mis-sold? - How to tell if you’ve been mis-sold PPI

 

Another useful site to help you reclaim missold PPI UPDATED 16 JUN 08

Reclaim your PPI premiums - payment protection insurance | This is Money

 

This is a little snippet from the above link....

Quote:

Can I reclaim on any PPI policy?

Your claim for compensation is dependent on when you took the insurance. PPI sales only came under the jurisdiction of the FSA on 14 January 2005. Any sales made before then are not covered by the latest rules.

However, it may still be worth complaining to your lender if you feel you have been mis-sold. If you bought before January 2005 it is likely that they will have been covered by a previous regime of rules. This means that the Financial Ombudsman Service will be able to consider these complaints. If you took PPI after January 2005, your claim is subject to the latest rules.

All of the above and more in this sticky at the top of the forum.

 

Mis-sold PPI? Want your money back? use these links to help

It's a lot of reading but some useful stuff in there

 

Hope this helps

 

2. Do your homework first

 

3. Then claim your money back

 

aa

 

[debtdeception]

In addition you can try the CCCS as they have successfully helped a lot of people to get the interest frozen and repayments reduced.