PPI claim won but company offsetting against an account they accepted a full and final offer on?

[TheAnalyst]

Probably a simple one.

 

On 07/07/2003 I took out a 2nd Welcome loan for £2451.90 (paid off some of an old loan with the new one)

 

Loan: £2451.90

PPI: £780.70 (told my loan would be refused if I never took it, was not applicable to me as I was self employed)

Total: £3232.60

APR: 45.1%

Period: 36 Months

Repayments: £151.50

 

In total I mate 19 payments of £151.50 then never paid anything after that as I got into real financial hardship, they charged me in total £450 for failed DD's, phone calls and visits to my home. I still owed them £3560

 

In 2008 I offered them a one time payment of £1200 in full and final settlement of the account and they accepted.

 

Re: Welcome Finance - Account Number: XXXXXXX

 

We refer to our telephone conversation on the 18th January 2008, and confirm that we have accepted the sum of £1,200.00 in full and final settlement on this account.

 

Earlier this year I started a claim against them for miss selling of PPI.

 

The short of it is they found in my favour to the tune of £2200 odd but at the end of the letter they said that I would not receive anything as the account was closed with an outstanding balance around the same amount as my PPI claim, essentially it would all be offset against that?

 

What's your thoughts? Can I argue that having accepted my payment as a full and final settlement then I should be entitled to my PPI refund?

 

Thanks

[citizenB]

I would certainly be challenging their actions. If they accepted a full and final payment, then where is the "outstanding balance" ?

[Peterbard]

HI

 

I would certainly argue so.

 

Was there any correspondence between you and them about the full and final, do you have any further documentary evidence that the account was settled and terminated ?

[TheAnalyst]

That's what I thought too. They were happy enough to accept this full and final payment over 5 years ago, full and final to me means just that.

 

Or what about this way.

 

I took out a loan with a total amount to pay with PPI of £5454

I paid them monthly payments totalling £2878.50 + £1200 to settle the account which = £4078.50 or 75% of the total loan had I paid every monthly payment.

So give me 75% of the £2200 of the PPI you have agreed you have mis-sold me?

 

Does that not make sense?

 

 

 

HI

 

I would certainly argue so.

 

Was there any correspondence between you and them about the full and final, do you have any further documentary evidence that the account was settled and terminated ?

 

 

Thanks for the reply. Yes I have both a letter and an email from two different people at that company stating

 

"We refer to our telephone conversation on the 18th January 2008, and confirm that we have accepted the sum of £1,200.00 in full and final settlement on this account."

[Peterbard]

That's what I thought too. They were happy enough to accept this full and final payment over 5 years ago, full and final to me means just that.

 

Or what about this way.

 

I took out a loan with a total amount to pay with PPI of £5454

I paid them monthly payments totalling £2878.50 + £1200 to settle the account which = £4078.50 or 75% of the total loan had I paid every monthly payment.

So give me 75% of the £2200 of the PPI you have agreed you have mis-sold me?

 

Does that not make sense?

 

 

 

 

 

 

Thanks for the reply. Yes I have both a letter and an email from two different people at that company stating

 

"We refer to our telephone conversation on the 18th January 2008, and confirm that we have accepted the sum of £1,200.00 in full and final settlement on this account."

 

I would have to look up the case law but there is a right of of-sett when there is an outstanding balance on the account, but as CB says in your case there wasn't any, so any premiums you paid should be refunded to you plus your stat interest.

 

I would write them a letter telling them that you do not accept their decision for the above reason and then follow it up with an letter before action, personally I would go after the full sum.

[IainHL]

As this was only settled in early 2008 it should still be on your credit report. What does it state there ("settled", "part settled", something else)? Also do you have a copy of any letter you might have sent them with your payment of £1200 in F&F?

 

I wouldn't get into complicated arithmetic with them, and showing a willingness to accept less than the full amount of PPI only gives them a chink to try and open wider. Insist on them repaying you the full amount of ~£2200 as per their calculations.

[TheAnalyst]

Hi there, thanks for the reply actually part of the settlement agreement from me was that they removed the (defaulted) account from my credit file completely, and they did!

 

I have an email and a letter from them thanking me for my telephone payment and accepting it in FULL AND FINAL settlement of my account.

 

I'll try getting back to them first but I suspect I'm probably actually looking at the FOS for help now to be honest, I think that's what the letter stated my only recourse would be from here so at the end of the day I have to be as open as it as possible.

 

75% of £2200 is better than nothing and it seems to make sense to me that I paid 75% of the overall amount (even taking all their questionable charges into account) so I should, at least, be entitled to 75% of the claim for mis-sold PPi?

[Hortz]

They have the right to offset against anything you defaulted on, so if the amount you owed but never paid was over £2,200 they can offset the lot. If it was less you will get whatever is left over when the defaulted amount is paid off.

[Peterbard]

They have the right to offset against anything you defaulted on, so if the amount you owed but never paid was over £2,200 they can offset the lot. If it was less you will get whatever is left over when the defaulted amount is paid off.

 

The account was settled in full there would be no default balance.

[Hortz]

The account was settled in full there would be no default balance.

 

I might have read it wrong, but the original post said the account was closed with an outstanding balance.

 

If the £1,200 was all that was outstanding on the loan when it was repaid then the money should go to the OP. If the loan provider accepted less than was actually owed then they can and will offset.

[Peterbard]

I might have read it wrong, but the original post said the account was closed with an outstanding balance.

 

If the £1,200 was all that was outstanding on the loan when it was repaid then the money should go to the OP. If the loan provider accepted less than was actually owed then they can and will offset.

 

The whole point of a full and final settlement is that the loan is considered to be repaid in full, if this were not the case it would be called a part settlement.

[Hortz]

The whole point of a full and final settlement is that the loan is considered to be repaid in full, if this were not the case it would be called a part settlement.

 

It is not repaid in full though. They might have agreed to accept less than was owed and close the account. However, if the amount they wrote off was the same as the cost of the PPI then in effect he has not paid the PPI. Nobody is going to give you money back for something you haven't paid for.

[Peterbard]

It is not repaid in full though. They might have agreed to accept less than was owed and close the account. However, if the amount they wrote off was the same as the cost of the PPI then in effect he has not paid the PPI. Nobody is going to give you money back for something you haven't paid for.

 

There is much case law regarding full and final settlements and the legal implications, if you google search I am sure you will find it.

 

One of the ramifications of a correctly executed full and final settlement is that no further liabilities are due and payable on the account, when the payment was made the account was terminated and there was no debit balance, therefor any further sums credited to the op after this should have gone to them.

[Hortz]

There is much case law regarding full and final settlements and the legal implications, if you google search I am sure you will find it.

 

One of the ramifications of a correctly executed full and final settlement is that no further liabilities are due and payable on the account, when the payment was made the account was terminated and there was no debit balance, therefor any further sums credited to the op after this should have gone to them.

 

There's a significant difference between agreeing not to pursue the customer for any further payments towards the loan and actually handing money over to them that they never paid.

 

The bank is perfectly entitled to take this stance. If they uphold the complaint they only have to refund what the OP paid for the PPI. The loan account was underpaid by more than the amount of the PPI premium. Therefore, the OP in effect never paid anything for it. FOS recognise this as well. Only in cases of serious financial hardship might they direct the lender to pay the funds to the OP directly. And beating in mind that the OP appears to have negotiated reduced settlements on his/ her debts, I would guess this doesn't apply.

[Peterbard]

There's a significant difference between agreeing not to pursue the customer for any further payments towards the loan and actually handing money over to them that they never paid.

 

The bank is perfectly entitled to take this stance. If they uphold the complaint they only have to refund what the OP paid for the PPI. The loan account was underpaid by more than the amount of the PPI premium. Therefore, the OP in effect never paid anything for it. FOS recognise this as well. Only in cases of serious financial hardship might they direct the lender to pay the funds to the OP directly. And beating in mind that the OP appears to have negotiated reduced settlements on his/ her debts, I would guess this doesn't apply.

 

I am not sure how many more ways i can say this so this will be my at attempt. the bank did not agree to stop pursuing the debtor for a consideration, they accepted a full and final settlement (according to the OP).

[Hortz]

As another point, there's something about this case that doesn't stack up. Welcome Finance are in default and their PPI complaints are being dealt with by the Financial Services Compensation Scheme. They would have issued the response. However, the OP has stated that the loan was taken in 2003. If this is the case the. It was pre regulation and hence would not be eligible for FSCS consideration.

[Hortz]

I am not sure how many more ways i can say this so this will be my at attempt. the bank did not agree to stop pursuing the debtor for a consideration, they accepted a full and final settlement (according to the OP).

 

And I'm not sure how many ways I can say this (so this will also be my final attempt). However you want to dress it up, the simple fact is that the OP did not pay for the PPI. Therefore he/ she is not entitled to a refund of the money that they did not pay.

 

Assuming what I have said above regarding the FSCS to be true then the complaint has not been investigated by the lender but by an impartial statutory compensation scheme. They have no motive to be unfair about it. If they have not paid the money to the OP if is because he/she is not entitled to it.

 

Let's just wait and see hey. Nice debating with you.

[ims21]

I'm with the majority on this one in that much will depend on the precise nature of the F&F. I think it is worth chasing them for the refund on the basis that they agreed a deal and now want to renege on that deal because it now no longer suits them. Tough luck on them.

 

 

I don't see how mention of Welcome being in default is relevant here since the event was pre 2005 which makes Welcome liable themselves and not the FSCS.

[Hortz]

This is the point. Welcome has gone bust. Kaput. It doesn't exist as a company anymore. It was deregistred with companies house in June 2011. Therefore it cannot meet its own liabilities, which is why the FSCS is dealing with its PPI complaints. It's not a case of the FSCS being "liable". It's a case of them dealing with the matter as Welcome no longer exists.

 

If the information in the opening post is accurate then the FSCS wouldn't be able to consider the complaint as it is pre- 2005. Therefore, the OP would be totally stuffed as he/she wouldn have nobody to complain to let alone get a decision letter. Hence my reason for querying it.

[IainHL]

Hortz, I believe you are mistaken. Welcome does still exist. From the Companies House website:

 

Name & Registered Office:

WELCOME FINANCIAL SERVICES LIMITED

KINGSTON HOUSE CENTRE 27 BUSINESS PARK

WOODHEAD ROAD

BIRSTALL, BATLEY

WEST YORKSHIRE

ENGLAND

WF17 9TD

Company No. 00133540

Status: Active

[IainHL]

And to TheAnalyst I would still maintain that your approach should be to be asking for the full amount of the PPI claim to be repaid to you at this stage. I would not start by talking about this 75% calculation with Welcome.

[Peterbard]

Anything could happen on this thread, to be honest I did not know that a creditor could remove a correctly placed default marker on an account, I would have thought they were compelled by the DPA to correctly record information. I didn't think that deals could be done to bypass legislation in this way.

 

Well you live and learn

[dx100uk]

welcome staff are operating under the guidelines of the FSCS .

 

there an old thread here that explains why the fscs did it this way.

 

we had lots of issues in the early days when this happened.

 

dx