Welcome nightmare

[DOTCOM]

Hi

 

 

My daughter took out a secured loan with welcome finance for £3000 they added PPI £1374 and a mortgage indemnity fee, the loan was for 36 months. After a while she asked for a furher advance of £2000 they gave her this and added another Mortgage Indemnity fee.

 

My daughter got into difficulty paying the loan which was now around £7800

although she has only ever received £5000 cash into her bank account.

 

This went to the Ombudsman in 2009 she has just received his decision re PPI

he said Welcome should recalculate the loan to put her in a position she would be in if PPI had never been added to the loan.

 

Welcome have said they will do this and have stated the balance of the loan is £14,000 they will take off PPI plus 8% and rewrite the loan for £10,000.

The Ombudsman seems to think this is fine although we have had no explanation of how the balance is now £14,000 and considering my daughter has already paid £8500 it does not seem fair.

 

The ombudsman says his decision is final but doesn't seem to get that he is allowing Welcome to present any figures they want. I am happy with the Ombudsman decision but not happy because Welcome are not making it clear how she stills owes so much.

 

We have asked Welcome for a full breakdown of everthing but they say we will have to send £10 for a SAR. we did this in the beginning and the statements were so messed up it was untrue

 

There is so much wrong with this account I fear I am going to need lots of help. There have been 4 agreements in all Welcome do not have the 4th one they have lost it, they sent a reconstructed one in my daughters married name although the loan was taken out when she was single!

 

They have only entered one charge at the Land Registry and that was for the first loan, which is effectively settled, the Land registry say they should have entered each new loan any views on this please.

 

Is there an interest calculator where I could check welcome are paying the correct amount back for PPI.

Thanks in advance

[DOTCOM]

Thanks for your reply. I am going to tackle this one agreement at a time.

1st agreement shows

PPI £774.37

medicare £300

lifecare £175

homecare £120

acceptance fee £235

Mortgage indemnity fee £330

Anybody know which of these (besides PPI) we can reclaim?

[MrZ]

As dbabylon says, you need to have copies of your statements and agreements. without these you will only be guessing and will have to trust Welcome's figures. I can tell you from experience that although Welcome say they will give you a full refund and modify the loan as if PPI had never been included, they often do not provide accurate claculations or breakdowns, nor will they correctly apply the necessary adjustments. You will look at each agreement individually but to get to the bottom of it, you will need all of the agreements and statements to hand.

 

When you have the correct figures and can show them the calculations, they will find it hard to dispute it, and will have to explain why their figures are correct and yours incorrect.

 

I am happy to audit your statements etc and explain what might be correct or incorrect, but you will have to get a copy of the statements first.

 

Rather than sending a Subject Access request, send a request under the CCA 1974 for a copy of the agreement and statements for your account. If you have more than one account number, you may need to seen a separate request for each one. But even if you had to send one for each agreement, it works out leass than the fee for the SA\r, and they only have 12 days to respond as opposed to 40 for the SAR.

 

Make your requests in writing, keep proof of postage. Meanwhile you should try to jot down a brief history of your relationship with Welcome. When yuio have all that together, post it here and you will get the help you need. read a fee threads here and you will soon see you are not alone in this as there are many others who have sufered at the hands of this bunch.

[DOTCOM]

Thanks so much for taking the time to reply, your advice is very much appreciated.

[DOTCOM]

Hi Everyone

Hope someone can assist.

I have now got my daughters statements and CCA agreements(she had already sent SAR and CCA request.

 

Stating with first agreement

amount of credit £3000

homecare £175

lifecare £ 125

medicare £300

PPI £774

acceptance fee £235

MIF £330

TOTAL LOAN £4039.37 RATE OF INTEREST 2.00% PER MONTH APR 38.93%

TOTAL AMOUNT OF CREDIT £4374.37

 

repayments £193.78 over 36 months

 

1ST question they have not added acceptance fee and Mif in total amount of credit is this correct.

2ND question are any of the above insurances (not PPI ) and fees reclaimable

3rd O mbudsman says loan has to be recalculated without any charges or PPI which would put my daughter in position she would be in if PPI had not been added how do we do this to check welcomes figures?

[MrZ]

1ST question they have not added acceptance fee and Mif in total amount of credit is this correct.

The MIF make up part of the charge for credit. If the MIf were an insurance policy it would need to be included as the amount of credit. If the PPI and other insurances were mandatory, they would need to be included as part of the charge for credit and not amount of credit.

2ND question are any of the above insurances (not PPI ) and fees reclaimable

Yes, all three.

3rd O mbudsman says loan has to be recalculated without any charges or PPI which would put my daughter in position she would be in if PPI had not been added how do we do this to check welcomes figures?

Work out the amount minus all of the insurances using the same interest. If their figures dont match ask for an explanation.

 

Did the FOS only decide this one agreement?

[DOTCOM]

Thanks for yor very very helpful replies.

 

As this was the 1st agreement (and the only one with PPI) this is the one the Ombudsman said welcome must remove PPI and put my daughter back where she would have been had it not been added.

The complication is loan two was for an extra £2000- 6 months into loan one - so loan one was was re written to give my daughter a further advance.

Loan three was a rewrite because my daughter could not affored repayments on loan two and loan four was a rewrite because she was again in difficulty with payments.

My daughter only ever received £5000 cash.

 

Our agument is that the PPI has had an effect on all 4 loans do you agree and how do we calculate backwards to a position we would be in if the PPI had not been added to loan one?

[DOTCOM]

I'm back again with more questions.

I have started with the initial loan of £3000 (taken out 10/3/2004)

£ 235 acceptance fee

£ 330 mortgage indemnity fee

TOTAL £ 3565

plus interest @ 38.93% to 10/12/2004 £1045 (when 2nd loan for £2000 was taken out)

TOTAL £4610

LESS PAYMENTS £1259.73

BALANCE £3350.27

Am I right in thinking that the second loan should have been written for £3350.27 plus £2000 cash advance plus acceptance fee plus MIF

[DOTCOM]

Hi can anybody direct me to a spreadsheet which will calculate contractual interest.

[ims21]

Hi

 

Have a read of No.1 in my signature....it will guide you through the rollover ppi scenario.

 

At the end there's a spreadsheet you can use for single premium ppi claims.

 

Aren't the FSCS dealing with Welcome claims?

 

Regards

 

ims

[DOTCOM]

Hi I have read through your very good thread on rollover PPI.

I am not sure I have done this correctly.

I worked out percentage of monthly payment which was for PPI

I have entered these amounts on spread sheet

I have worked out amount of PPI rolled over to loan 2

I worked out percentage of payment paid on loan 2 which was for PPI

I entered this on spread sheet

I then worked out amount of PPI rolled onto Loan 3

I did the same and worked out percentage of monthly payment which went to ppi

I entered this on spread sheet

Then I worked out amount of PPi ROLLED OVER ONTO LOAN 4

bECAUSE i COULDN'T GET YOUR SPREADSHEET TO WORK i USED ANOTHER ONE AND USED THE INTEREST RATE wELCOME HAD CHARGED FOR EACH LOAN AND REWRITE

Have I done this correctly and do I charge 8% on top of the above calculations?

Sorry for so many questions

I FSCS ARE DEALING WITH wELCOME BUT THIS IS A CASE WHERE wELCOME HAVE BEEN TOLD BY oMBUDSMAN TO REPAY ppi AND INSURANCES AND PUT MY DAUGHTER BACK IN A POSITION she would have been in had they not added PPI to loan

The difficulty is there has been 4 loans one rolled into the other the last 2 being rewrites with no extra money being advance. I don't trust Welcomes figures they are only reducing the loan by £1716.84. PPi added to the loan back in 2004 was £1374!!

[ims21]

Hi

 

Just going off to work but will have a look later for you.

 

Spreadsheet didn't work? Are you using Excel? what was the problem with it please?

 

ims

[DOTCOM]

Sorry it did work but it calcul;ated at 8% I wanted to use contractual interest (just realised I could have changed interest amount) I'm really thick!

Thanks for all your help

[MrZ]

Sorry it did work but it calcul;ated at 8% I wanted to use contractual interest (just realised I could have changed interest amount) I'm really thick!

Thanks for all your help

 

It sounds as if your approach is correct but it will be difficult to confirm your figures without sight of the paperwork.

 

Its is very unlikely Welcome will entertain the idea of contractual interest on top. I have my claim in court at the moment and they are still sticking by the position that 8% simple is the best they will offer.

 

You might do two versions, one with 8% and one with contractual interest. If you can argue the case and get them to agree the contractual interst thats great, either way you will have the correct figures to compare to theirs.

[ims21]

Hi Mr Z...long time no speak....are you OK?

 

Hi DOTCOM

 

As Mr Z says, in order to get contractual compund interest you would need to sue...this method is not the one that fos would award. They would award the premiums plus the interest charged by the bank (which is included in the monthly repayment) plus 8% stat on top.

 

So Loans 1 and 2 had PPI but loans 3 and 4 didn't...they only had the rolled over PPI.

 

So you take loan 1 and work out the percentage of ppi on that loan and of each payment made, that percentage relates to ppi.

 

When loan 2 comes along, you look at the settlement figure of loan 1 and apply the above percentage to find out what the ppi from loan 1 was that was rolled into loan 2. You then work out what percentage that was of loan 2. You also work out the precentage of loan 2 that related to the loan 2 ppi. Each repayment of loan 2 contains the percentage of loan 2 ppi and the percentage of loan 1 ppi.

 

Loan 3 comes along and has no ppi on the loan itself, only the rolled over ppi from loans 1 and 2.. So, take the settlement figure from loan 2 and apply the percetnages of loan 1 rolled over ppi and loan 2 ppi percentage and you will find out the total rolled over ppi from loans 1 and 2 that went into loan 3. If loan 3 was just an extension of term rather than extra money involved then the percentages stay the same as for loan 2.

 

When loan 4 comes along, if there was just an extension of term then the percentages staty the same but if extra money was made available as well then you need to re-calculate the percentages of loan 1 and loan 2 ppi included in loan 4.

 

ims

[MrZ]

Hi Mr Z...long time no speak....are you OK?

 

 

Hi ims,

 

Yeah I'm ok. Was in court recently with two other matters. I lost one (a set aside application) and won another (got an order to force my mortgage bank to disclose/supply my agreements and a full accounting). Other than that still doing the tango with Welcome.

[ims21]

Hi ims,

 

Yeah I'm ok. Was in court recently with two other matters. I lost one (a set aside application) and won another (got an order to force my mortgage bank to disclose/supply my agreements and a full accounting). Other than that still doing the tango with Welcome.

 

Keep at 'em MrZ

 

Best wishes

 

ims

[pdb1980]

Forgive me for butting in but I notice that there is a MIF on one of the loans you mentioned for £3k surely thats wrong?

[DOTCOM]

Hi pdb

that was going to be my next question.

All the four loans are secured on her property and they have charged a mortgage indemnity fee on each one which the Ombudsman says is ok - any views please.

 

ims, so I am better just sticking with your spreadsheet?

 

Only the very first loan had PPI

When I fill in the spreadsheet the charges (without interest)only add up to £1135.99 although PPI charged was £1374.37.

Loan four has not had any payments made on it since 24/10/2009 so the balance outstanding still has PPi in there what do I do about this? Am I making myself clear. There is still £239.00 PPI which my daughter has not made any payments against but welcome have it in the balance she owes.

[ims21]

Hi DOTCOM

 

OK...I think I'm getting there.

 

Loan 1 had PPI but loans 2, 3 and 4 did not have ppi on them per se. BUT they did have the residual PPI from loan 1 rolled into them by virtue of the refinancing/extension of terms etc. Have I finally got that bit right?

 

I have some time this evening and tomorrow so we can nail this calculation for you and yes, you only need the 8% spreadsheet...nothing more.

 

Regards

 

ims

[DOTCOM]

Thanks very much do you need the figures of the loans?

[ims21]

Hi

 

Lets go through them a stage at a time so that we follow a logical progression and which may assist others in the future.

 

Loan 1 PPI premium was £774.37 and the toal amount of credit was £4,374.37. This means that 17.70% of the loan was for ppi.

 

So for each repayment actually made, 17.7% of it was for PPI and included the bank's interest. Pop each of those amounts into the spreadsheet togetjher with the dates of the payments.

 

Now we move to loan 2 which had no PPI in its own right. You said that it refinanced loan 1 with an extra £2000 so can you post up the figures for loan 2 please?

 

ims

[DOTCOM]

OK

repayments on loan 1 were £193.79 so each payment for PPI was £34.30 is that correct?

 

Can I just ask if I follow this procedure for other insurances added to loan which Ombudsman said we can reclaim?

 

Going to loan 2

 

Welcome wanted £3972.89 to clear loan 1

There was a further cash advance of £2000

There is a figure for fee disbursement of £892.02

and Lifecare £175

Loan 2 was rewritten for £7039.91

[ims21]

Hi

 

Ok...thanks.....just breaking for supper but will be back later for you

 

ims

[ims21]

OK

repayments on loan 1 were £193.79 so each payment for PPI was £34.30 is that correct?

 

Yes

 

Can I just ask if I follow this procedure for other insurances added to loan which Ombudsman said we can reclaim?

 

If it is a single premium policy added to a standard loan account....yes

 

Going to loan 2

 

Welcome wanted £3972.89 to clear loan 1

There was a further cash advance of £2000

There is a figure for fee disbursement of £892.02

and Lifecare £175

Loan 2 was rewritten for £7039.91

 

ok so the settlement figure on loan 1 was £3,972.89. We know that 17.7% of that was for the PPI part of the loan which comes to £703.20. So, included in the loan 2 total is £703.20 from loan 1 which is for loan 1 PPI. Loan 2 total is £7,039.91 so the percentage of that which relates to Loan 1 PPI is given by 703.20 / 7039.91 x 100 = 9.99%. So of each repayment on loan 2, 9.99% of it relates to ppi. List these amounts on the spreadsheet for however many repayments were made before it was rolled into loan 3.

 

Can we have loan 3 figures please?

 

 

ims