MBNA Settlement Figures Help

[ken100464]

Would think quite clearly from that claculation they are not applying interest other than for the month of the premium.

 

That fires a bomb right into the redress of returning the customer to where they were because the interest carries on growing until the end of the account or the suspension of interest at the very least.

 

Anyone does this seem correct?

[arniebear]

Would think quite clearly from that claculation they are not applying interest other than for the month of the premium.

 

That fires a bomb right into the redress of returning the customer to where they were because the interest carries on growing until the end of the account or the suspension of interest at the very least.

 

Anyone does this seem correct?

 

That would make sense to me. I need to be able to work out what they should of paid so that when I tackle them I sound like I know what I'm on about

[ken100464]

You may find the thread I started earlier to the sight team. There are a number of us who are now reporting this lack of interest from MBNA. Its either a mistake in their computer model or a new worrying trend.

[arniebear]

Interesting !! You seem to be having the same problem

[ken100464]

Yep.

 

I have a list of transactions but no statements so cannot reconstruct the account as per the spreadsheets here. But the transactions were the result of a SAR. So they cannot reconstruct either unless they havnt fulfilled my SAR correctly and now admit it.

 

So they should have what I have and should then be paying contractual interest on the premiums/charges as per IMS post to me.

 

With the way they have listed premiums and interest my account doesnt go into the black so therefore I shouldnt have had 8%. But I do and I have quite a bit which indicates the account was in the black.

 

I am quite relaxed about it because Helifax who have settled did for premiums and charges at contractual. Thats as per the FOS website too and thats what the guys on here are also saying.

 

Write to MBNA dispute it and if they dont agree take to FOS who I am sure will uphold and will cost them even more.

 

I personally think looking at your spreadsheet that they have programmed it wrong.

[arniebear]

Yep.

 

 

Write to MBNA dispute it and if they dont agree take to FOS who I am sure will uphold and will cost them even more.

 

It will have to be done by telephone as their last letter stated they would no longer respond to any letter But it might be quicker than waiting for them to reply by post

[ken100464]

One of things that gets me is the 8% simple when you have a balance on the card.

 

Quite clearly on FOS website and from IMS this only accrues if the balance was in credit for the time it was in credit and if the reconstructed account leaves a positive balance from that point till settlement.

 

You have 8% on nearly every month from a very small positive balance near the start of the account. That cant be right.

 

And this then increases when you get another surplus later on in the account.

 

And with your balances that is certainly not the figure he spreadsheet on here would give you.

[dx100uk]

can i just confirm something please

 

what EXACTLY does the letter say in respect to their final response.

 

dx

[arniebear]

My Letter States

I am writing to further to your correspondence outlining your concerns regarding the Payment Protection Insurance on the above account.

 

I can confirm that your concerns have already been addressed under ref ******3

and a final response was sent to you on 20 August 2012 outlining our findings.

 

As Requested I enclose a copy of the breakdown calculation we have used to calculate your refund for your information

 

Please be informed that the above reference will now be closed and no further correspondence will be sent

 

Yours Sincerley

 

Rachel Nixon

 

Customer Advocate Office Manager

[ims21]

Hi

 

Just having a crack at a reconstruction on this.

 

Was this card taken as a balance transfer deal with 0% interest on balance transfers for six months by any chance?

[arniebear]

Yes I believe it was

[arniebear]

If I've got in right it looks like they have calculates the refund of premiums and then reconstructed the account without the PPI and added the difference between the new closing balance and the old one

[arniebear]

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I have attached pdf of spreadsheet putting in their figures. If this is right maybe I should cash my cheque now

[ken100464]

Just had a stab at a recon for you.

 

Firstly to get your associated interest they seem to have used 7.42%. As IMS says looks like they have averaged out the interest.

 

But my recon doesnt look anything like what they have. They have in my mind subtracted the PPI and interest at the start of the account thus saying that this is put you back to where you were. But that sucks because in reality the balance will always be higher until settled and so will be still reaping them interest.

 

Secondly dont understand why they are giving 8% on this small amount of capital throughout the life of the account.

 

But the money was still within your account and was still accuring interest at your contractual rate. They have ignored this element.

 

Also there are numerous £12 and £24 transactions towards the end of the account. Penalty charges methinks. If your limit was £8000 which you right until the end seemed to be keeping to then a good number of these should have been removed. And as IMS says should also attract contractual interest.

 

Also there are a number of same transactions which could have been you but did you really actually spend 27.48 5 times on the card over a 7 month timescale. I would be happy if there were higher charges inbetween but you have one month where the payment was 2.49. see end of 2005. Are these actually what happened or is the recon littered with clerical errors.

 

If this was me I really wouldnt be happy with the reconstruction

[dx100uk]

i couldn't make head nor tail of mbna stuff

total fabrication aimed to confuse

 

i think the fos would be interested to see this

 

IMHO it's a blatant attempt to frustrate reclaimers

 

dx

[ims21]

Been on this for a few hours.....nearly there.....please bear with.....

[ims21]

OK got it.

 

Having finally sussed out what their breakdown is all about, I personally think they are about right unfortunately.

 

There are two things the we didn't pick up on, one of which I mentioned earlier.

 

This was an account that came with an introductory offer of 0% on balance transfers for six months and a reduced rate on purchases for the same period. The balance transfer doesn't worry us as far as the PPI is concerned but it does explain why the interest in the early months is so low.

 

The reduced rate for purchases does interest us because it explains why the contractual interest on the PPI is so low for the first few months.

 

The second thing that we hadn't spotted is that the account balance was cleared in October 2003. This is important.

 

It means that as the PPI had stopped (presumably cancelled) and the account cleared, any further interest charged on the account related to purchases only and not the PPI.

 

So the contractual interest award would have stopped at the time the account was cleared.

 

When the account was cleared, there was an excess balance of £362 which is the difference between the reconstructed balance and the actual balance paid off. This amount attracts 8% simple running from the date the account was cleared right up to the date of settlement (which they have said is July 2012).

 

I have reconstructed the account and I get an award figure of about the £656 mark which is very close to theirs given that we don't know for sure what the interest rate on the card was.

 

In my reconstruction I worked it out as an approximation given the interest charged monthly on the outstanding balance in the early years and I came up with a rate of about 15%.

 

This gives me figures for premiums paid £341.82, Contractual interest as a result of PPI £43.01 and statutory interest of £271.94 which totals to £656.32.

 

ims

[arniebear]

Mmmmm Thanks Guys. I time to relook at my SAR paperwork!!

[ken100464]

IMS

 

If there is a break in premiums not because the policy was cancelled but the balance went to zero would that also stop contractual interest. For the premiums before the zero balance occurance.

 

And this is presumably why guys in the know go for restitution. The premiums and interest is still within the balance and is therefore accruing card rate interest but they get away with handing out 8%. That certainly doesnt put the consumer back to where they were does it.

[ims21]

If the balance was cleared and there was historic PPI then the reconstructed balance at that point would show a credit balance on which 8% would be awarded.

 

All the time the balance is paid off each month then no further PPI would be added and no further contractual interest in it either. The reconstructed balance would still show as being in credit so the 8% simple would still accrue on that.

 

When the card again starts to have a balance on it and PPi charges added then any contractual interest as a result will still accrue.

 

The regulatory method of redress doesn't recognise restitution, only the 8%. A court may award a higher rate of interest in restitution but that is a whole different discussion.

 

By refunding the premiums and any contractual interest on them, together with any default charges and associated interest that arose purely as a result of the PPI, the claimant is put back in the position they would have been in had the PPI not been applied. The 8% interest is to compensate them for not having the use of the money they parted with which could perhaps have earned interest in a savings account.

[arniebear]

Thanks Ims, I Guess from that I had better cash my cheque then

[ken100464]

OK got it.

 

Having finally sussed out what their breakdown is all about, I personally think they are about right unfortunately.

 

There are two things the we didn't pick up on, one of which I mentioned earlier.

 

This was an account that came with an introductory offer of 0% on balance transfers for six months and a reduced rate on purchases for the same period. The balance transfer doesn't worry us as far as the PPI is concerned but it does explain why the interest in the early months is so low.

 

The reduced rate for purchases does interest us because it explains why the contractual interest on the PPI is so low for the first few months.

 

The second thing that we hadn't spotted is that the account balance was cleared in October 2003. This is important.

 

It means that as the PPI had stopped (presumably cancelled) and the account cleared, any further interest charged on the account related to purchases only and not the PPI.

 

So the contractual interest award would have stopped at the time the account was cleared.

 

When the account was cleared, there was an excess balance of £362 which is the difference between the reconstructed balance and the actual balance paid off. This amount attracts 8% simple running from the date the account was cleared right up to the date of settlement (which they have said is July 2012).

 

I have reconstructed the account and I get an award figure of about the £656 mark which is very close to theirs given that we don't know for sure what the interest rate on the card was.

 

In my reconstruction I worked it out as an approximation given the interest charged monthly on the outstanding balance in the early years and I came up with a rate of about 15%.

 

This gives me figures for premiums paid £341.82, Contractual interest as a result of PPI £43.01 and statutory interest of £271.94 which totals to £656.32.

 

ims

 

Would it be possible for you to look at this again.

 

I am highly suspicious of the recon balance.

 

If you look at the line for the 3/10/2002 you will see a payment of £2586.30 was made which cleared the debt. But because of PPI and associated interest the balance went into credit of £134.67.

 

New transactions amount to £1827.87. From this they take off the PPI and associated interest for that month but the £134.67 goes into a surplus pot and attracts 8%. Thats fine I get all that.

 

Neither the £134.67 or the 8% simple is applied to the recon balance.

 

In this case the recon balance is already £134.67 higher than it should be. Which inturn means the redress is £134.67 light.

 

It happens again on line 3/10/2003. In this case they remove the overpayments of £224.04 on a balance of £27.40. However the recon balance is £23.79. I see no mention of this in the redress. The recon balance and the actual balance now merge into the same amount and magically the £362.32 doesnt get paid back or the balance reduced to take account of the fact he overpaid.

 

This is crucial to my case and if they are allowed to remove this money from the account and pretend it was never there then I am completely stuffed.

[ims21]

Have a look at the recon I have done using my spreadsheets.

 

Note that I have used 15%as the interest rate although this is not going to be a true reflection given the special offer you got in the first six months of the account so you have to take a view on what the actual average rate was. It will be a fact that my estimate is higher because of this.

 

You will see that I am within £38.72 and at least part of that can be accounted for as above.

 

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