PPI issue with HSBC

[WendyN]

Hi everyone,

 

Last summer I was sent a questionnaire by HSBC querying the PPI I had paid alongside some loans I took out a good while ago but have now paid back.

Evidently my answers to the questions led them to think that I had indeed been missold PPI - I was led to believe that I could not get the loans without it.

 

Their settlement seemed reasonable on the face of it, but I couldn't work out how on earth they had come up with their figures... So I asked them for more details about this. To date I have had no sensible answer from them, except to say that they are perfectly happy with how they've worked it out. Useful!

 

I sought information and advice from the lovely folks on this invaluable forum, and have downloaded a spreadsheet to help me calculate both the PPI payments themselves and the interest due to check that they match. Also, I submitted a FoI request to get the PPI payment details from HSBC. Again, smoke and mirrors and no resemblance to what they have whatsoever...!

 

So I have a few questions if you don't mind...

- the first loan on which I paid PPI was in 2001-2. HSBC claim that they have no data from before six years ago - although miraculously they managed to find it to calculate the settlement :-/ Are other claims going this far back? Have others been successful in getting data about these from their banks?

- I was charged interest on the PPI payments that I made. Presumably this is also repayable?

- the situation is complicated in that each loan was consolidated into the next one, and early repayment charges applied (sometimes up to 2-3 months payments were taken as an early repayment charge). Should these PPI payments also be included?

- how are people calculating the interest on these payments? The spreadsheet that I'm using calculates the compound interest from the date of each payment, but I have noticed elsewhere on the forum that others seem to have used 8% simple interest.

- the loans I paid PPI on date from 2001 - 2005. Should the interest be calculated to the present day, as in effect HSBC still have the money?

 

Sorry about all the questions, but I'm obviously quite a newcomer to all this and I'm trying to work out what I'm doing!

 

Thanks very much to all of you

 

WendyN

[ims21]

Hi

 

The fact that they are happy with their calculations does not mean they are correct. You are entitled to have a detailed breakdown of how they calculated their figure and if they continue to refuse then you should get fos involved.

 

The CI sheet you are using isn't the right one for loans, you should be using the 8% calculator.

 

In order to get the correct figure for the redress you will need to know how much of each repayment was to the PPI part of the loan so you will need your record of payments and the figures from the original loan paperwork, i.e. cash loan, ppi loan, monthly repayment etc.

 

Have you got this information?

 

You should also have a read of No.1 in my signature which explains the rollover/consolidation aspect in detail.

 

I take it you have not yet accepted their offer? Has more than six months elapsed since their offer?

 

What you are entitled to get back are all premiums paid plus the associated contractual interest on those payments. In addition you should get 8% simple interest on each payment made running from the date of the payment to the date of settlement of the claim.

[WendyN]

Hello, thanks very much for your reply.

 

"The fact that they are happy with their calculations does not mean they are correct."

- Absolutely :o) I'm with you on that one...

 

"You are entitled to have a detailed breakdown of how they calculated their figure and if they continue to refuse then you should get fos involved."

- I have a letter with a list of figures, but not what they mean and not how they were calculated. I also got a whole box-worth of stuff in return for my freedom of information request, very little of which is even relevant, let alone useful. Seriously, do they really believe that sending this stuff will put me off?! I will write back to ask them for a detailed breakdown.

 

"The CI sheet you are using isn't the right one for loans, you should be using the 8% calculator"

- Great, I've now found this, thanks for the tip.

 

"In order to get the correct figure for the redress you will need to know how much of each repayment was to the PPI part of the loan so you will need your record of payments and the figures from the original loan paperwork, i.e. cash loan, ppi loan, monthly repayment etc."

- I had five loans. For 4 of the 5, I have the loan agreement which details the PPI which needed to be paid, in what monthly instalments. I also have my bank statements which state when the payments were made. I DON'T seem to have the oldest loan agreemen, which was from 2001, and I don't have a breakdown of what PPI was paid as part of the early settlement payments when I consolidated / reorganised the loans. However, I don't think the bank ever gave me anything like this - something which I seem to remember querying at the time (the early repayment charges were pretty high, and often amounted to 2-3 months worth of payments on their own).

 

"You should also have a read of No.1 in my signature which explains the rollover/consolidation aspect in detail."

- I will do this, thanks.

 

"I take it you have not yet accepted their offer? Has more than six months elapsed since their offer?"

- The offer was made 22 October 2013. I haven't accepted their offer yet, as I simply wanted them to explain their reasoning / calculations. I thought that this was a comparatively simply question, but they have escalated it into a 'complaint'..!

 

"What you are entitled to get back are all premiums paid plus the associated contractual interest on those payments. In addition you should get 8% simple interest on each payment made running from the date of the payment to the date of settlement of the claim."

- I will put all of the information I have into this new spreadsheet, and see how I get on. I will also write to them to ask for a detailed breakdown of the caclucations they've used to come up with the offer.

 

Again, a very big thank you for your help!

 

WendyN

[ims21]

Good stuff.

 

Keep your eye on the six month time limit for a referral to fos if you are not happy.

[WendyN]

Hi again,

 

I am in contact with two parts of HSBC.

 

The PPI team have told me (again) that they are satisfied that the way they are calculating PPI settlements (which is nice for them) but are still refusing to give me any details on how this is done (again, very handy for them).

 

The Data Access team are insisting that they destroy paperwork after six years and are currently refusing to send anything other than they already have. Luckily I have kept almost all of what I need anyway, so I think actually that this doesn't really matter.

 

I have had a trawl through what they have sent me, and information that I have already, and have worked out all of the separate payments that I have made for all five different loans (with PPI plus PPI interest included) and I have put these in the Stat Int spreadsheet. So far, so good.

 

But: I'm afraid I am really struggling with working out the whole early repayments / refunds business. I've been reading through the information in your signature (which is great, thank you very much!) and I think what I need next is a loan progression spreadsheet, but I can't seem to find this - would you mind posting a link to it, or pointing me in the right direction?

 

I have all the figures for the PPI paid, interest on top, and refunds made - but I just need to put them in an order that makes sense!

 

Thanks so much for your help :o)

 

WendyN

[ims21]

Sure, here's the loan analysis sheet

 

 

LoanAnalysis.xls

[WendyN]

Brilliant, and thanks for replying so quickly :o)

[ims21]

[WendyN]

I'm so sorry, I have spent hours, if not days, trying to work this out, and I am still completely lost. I had five loans, starting in 2001, each of which rolled into the next one, until the final one, repaid early in 2005. I THINK that I have complete information on three of them, including the payments made, and I have partial information on the first two. I have also tried to use the spreadsheet you sent me to work out how the rebate should have worked, but I'm not sure if I'm right or not as it seems to come up with a different answer each time. Also, the APR on the spreadsheet appears to be wrong - it's calculated automatically and comes up with quite a low figure, whereas the true APR was over 17% for the first two loans and 9.9% for the last three. And how on earth do I represent the percentages in the final part of your instructions on my spreadsheet? HSBC is getting more and more intractable, and has told me that they 'will not be entering into any more dialogue' on this matter. Is there any way I can get more help on this? Would the Citizens Advice Service be of any use do you think? I'm really sorry to bother everyone but can anyone help?

[ims21]

Ok lets see what we have.

 

Can you post up as much data as you have on loan 1 please.

[WendyN]

OK. I am sorry about the mini-meltdown there, trawling through all this after a 12 hour day at work isn't the best. Thanks for your patience!

I have decided to start again with the brass tacks!

Here what I know:

Loan 1: July 01 - April 02

Amount of loan £1,500 Amount of PPI £141.81 Interest on loan ? Interest on PPI ? APR 17.3% Months 12 Payments made 9 of 12 Dates 01-Aug-2001 - 01-Apr-2002 Unknown Interest on loan, interest on PPI

[WendyN]

NB: No amount of PPI refunded when cancelled early.

[WendyN]

Loan 2: Apr-May 2002

Amount of loan £2,000

 

Amount of PPI £257.95 Interest on loan ? Interest on PPI ? APR 17.9% Months 18 Payments made 0 of 18 Dates 23-Apr-2002 - 31-May-2002 Unknown Interest on loan, interest on PPI

[WendyN]

NB: No amount of PPI refunded when cancelled early.

[WendyN]

I know more for the rest!

[WendyN]

Actually, I actually know more than I thought I did. It's just for the oldest ones I am missing information, so it's difficult to make a start on it.

I have asked HSBC again for that information so hopefully will hear soon...

[WendyN]

Thanks very much for any help or advice you can give! If you can point me in the right direction hopefully I can take it from there. Again, a really big thank you - I really appreciate it :o)

[ims21]

What was the monthly repayment amount for loan 1 please?

[WendyN]

£148.85 per month, but including loan plus interest, and pip plus interest, I don't have a breakdown of the component parts unfortunately.

[ims21]

Ok so your first loan was for £1500 plus the PPI of £141.81 making a total loan of £1641.81. The PPI part of the loan is 8.64% of the total (given by the formula 141.81 / 1641.81 x 100).

 

That means that 8.64% of every repayment you made was for the PPI part of the loan.

 

8.64% of £148.85 is £12.86 so each month you were paying £12.86 to the PPI part of the loan.

 

In your statutory interest spreadsheet, list the 9 payments you actually made giving the approximate date of the repayment (or the actual dates if you know them).

 

When you have done that, save your spreadsheet.

 

Did you get a rebate of PPI on loan 1 when you refinanced it with loan 2 and if so, how much was that rebate?

[WendyN]

You're an absolute wonder. I think I finally get it now!

Loan 1: according to the HSBC records I have - £0 refund.

According to the spreadsheet you sent me, after 9 months I should have had £37.60.

Loan 2: let's see if I can work it out...!

[WendyN]

So my second loan was for £2000 plus the PPI of £257.95 making a total loan of £2257.95. The PPI part of the loan is 11.42% of the total (given by the formula 257.95 / 2257.95 x 100).

 

That means that 11.42% of every repayment I made was for the PPI part of the loan.

Now, according to my HSBC records, each repayment would have been £142.05 over 18 months.

However, I didn't actually make any repayments, as the loan itself was rolled over into another one 6-7 weeks later.

 

But: 11.42% of £142.05 is £16.22 so each month I would have been paying £16.22 to the PPI part of the loan.

 

However, as I say, I didn't end up making any payments on that loan in the end, so the repayment I expected to get was £257.95, but what I actually got was £0.

 

Is that right?

[ims21]

Ok your maths is ok.

 

So we now have a position where you have £37.60 excess PPI from loan 1 and £257.95 from loan 2.

 

As no rebates were given, these amounts were refinanced into loan 3.

 

The total of the two is £295.55 so this becomes a percentage of loan 3 as well.

 

What are the figures for loan 3 please?

[WendyN]

OK, I've applied that formula to all five loans now, and I'm pretty sure that it's all correct now.

There's just the next stage of the process to get to grips with, with the multiple PPI policies thing...!

I'd be grateful for any pointers you can give :o) Thanks again for your help.

[WendyN]

Loan 3: Jun 02 - May 03 Amount of loan £10,000.00 Amount of PPI £ 2,109.58 Interest on loan (charge for credit) £ 2,594.50 Interest on PPI (charge for credit) £ 544.85 APR 9.9% Months 60 Monthly payment x1@ £44.13, x59@ £44.08 Payments made 11 of 60 Dates 30-Jun-2002 - 08-May-2003 Unknown - Early repayment refund expected £1,792.09 Early repayment refund received -£1,355.66 PPI claimed £921.36 Interest claimed £818.76