Welcome says My £12k CCA Regulated secured Loan will now become a mortgage!

[Baz1994]

Well yes they are now, because Welcome sent their final response to me in November

and was becoming rather frustrated with it all.

[dx100uk]

cisheet

[Baz1994]

cisheet

 

Cheers again dx

 

Sheet and letter sent recorded to Welcome yesterday - will keep you posted.

[Baz1994]

I have an ongoing PPI claim with Welcome and a seperate claim regarding unfair charges, fees etc in which I submitted a compound interest calculation spreadsheet with my letter.

 

Well today I have received a response from Welcome saying that they agree that I was unfairly charged and that they would be refunding amounts plus interest.

 

My question is, should they have included capitalisation (interest) amounts i.e. £20.00 unpaid direct debit amount (refunded) plus £20.00 capitalisation amount also applied (not refunded) and then compound interest applied to total of £40.00 ?

 

Its just that the figures that I have obviously differ to what they are saying and do not want to agree to anything until I am sure that what I have is correct.

 

Also my Loan Agreement APR was 20.1% (which I used on my spreadsheet) but latest annual statement quotes 16.20% - does this sound right ?

 

Sorry if questions sound stupid but I just want some advice and clarity before I respond.

[ims21]

Welcome tend to lay their statements out in an odd way.

 

If you look at an unpaid dd entry you will see on one line it says £20 for that. On the very next line it will say "Capitalisation" with an amount of exactly the same.

 

However, look at the balance on the account and you will see that it only changes by one amount of £20.

 

Capitalisation is the entry which actually adds that amount to the balance.

 

As a result you only get 1 x £20 back as only 1 x £20 has been charged.

 

As far as the interest rate goes, the 16.20% is probably the actual flat rate. The APR quoted on your agreement will more than likely include other things like a set up fee and/or documentation fee.

 

Have you got the agreement still?

[Baz1994]

Ah yes all very confusing and see what you mean, all a bit clearer now thanks regarding balance not changing twice.

 

Yes I still have a copy of the agreement and states APR 20.1% and 1.35% a month.

 

 

Should I have applied the 16.20% to my Compound Interest Calculations and not the 20.1 % ?

[ims21]

Hi

 

Ok 1.35% per month multiplied by 12 is the 16.20% figure and is therefore the flat rate i.e. the rate they use to actually calculate the interest on the loan.

 

The APR is higher due to their costs on the account/agreement.

 

They should be refunding you interest at the 16.20% rate on the charges they are giving back.

[Baz1994]

Many thanks ims and I have now entered correct % fig and all seems to be nearer theirs quoted, give or take a few pounds.

 

Just another quick question re PPI part of claim,

 

I have also done a spreadsheet (only PPI no MIF) but with 8% simple interest

 

- will the same 16.20% APR apply ?

 

Sorry ims please ignore that last comment re application of 16.20% APR but do I apply any other interest apart from 8% simple ?

[ims21]

Ah now the PPI is slightly different.

 

What you should be getting back is the amount of the premium paid to date plus associated contractual interest and a further 8% on each of those payments made. That 8% runs from the date of each payment to the date of settlement.

 

Is it one of the sheets from CAG that you have used or one of your own making?

 

This is the one to use

 

StatIntSheet v101.xls

 

If you want to post up your spreadsheet I'll take a look at it for you.

[Baz1994]

Thanks again and yes thats the one I had used iro PPI only excluding MIF payments.

 

Just another question re charges / fees

 

 

- Welcome are going to deduct from Loan balance is this correct ?

 

 

Am I entitled to request that it is repaid by cheque ?

 

 

Or can the fees/charges be refunded to account and the payment of interest by way of cheque ?

[ims21]

Is the account live and running normally or has it defaulted/terminated?

[Baz1994]

Its live and running normally but I have another ongoing dispute with them regarding some old outstanding payments.

[ims21]

Ok if the account is live and running then they will and can just credit those charges and the interest adjustment back to the account.

 

It does have the benefit of reducing the balance on the account of course.

[Baz1994]

I suppose that's one way of looking at it

but would have been nice to at least got the interest back by cheque, as quite a tidy sum.

 

On the above basis then,

if successful with the PPI will the same apply do you think ?

Or will I at least receive or entitled to refund of 8% simple by cheque ?

[ims21]

With the PPI it should be a different approach.

 

If there are no arrears on the account then the PPI and all of the interest should come to you.

 

The reason for the difference int he approach is that the charges on the account are deemed to be notional only and simply affect the balance. It is ok for the lender to credit these back to the account.

 

With the PPI on a single premium policy, the premium has actually been paid to the insurer at the start and you are making payments as you go against that. This means that the amounts you have paid towards it are actually deemed as paid. That is why you get 8% on top, as compensation for your actual loss of the use of your money.

 

PPI refunds can be used to set against notified arrears but as this account appears to be running its normal course there are no arrears so the money would come to you.

 

The lender should restructure the future part of the account to remove the PPI element from it so your future repayment amount should go down.

 

I have assumed here that the PPI claim is being dealt with by Welcome and not the FSCS.

[Baz1994]

Cheers again ims your comments are most helpful.

The loan is currently being paid contractually but as previously mentioned

I have an ongoing dispute / complaint in respect of some old arrears

but the PPI refund amount still outweighs what is supposedly outstanding.

 

 

Therefore would they just deduct from amount then and refund to me difference with interest amount ?

My main concern is that they will just do the same again. This obviously depends if it is eventually successful.

 

The actual loan was pre 2005 (Nov 2003) and was previously up-held by Welcome

but they are now trying to palm off to the broker / Underwriter

(who I had no previous contact with as seem as it was dealt with internally)

and is now currently with FOS who are dealing with it.

[ims21]

Ok as the account is currently being serviced properly and is apparently in order, then I would still say that the refund of PPI and associated interest should come to you and it is then for you to decide how to disburse it.

 

With a company like Welcome I would want to be rid of them as soon as possible so for me I would be happy for them to set off and give me any residual amount.

 

So again we see Welcome changing goalposts....yes we uphold your complaint......oh, hang on we smell a broker.....ah well we have changed our minds.

 

Just have to wait for the fos decision and if it is not favourable then it can always be escalated to an actual ombudsman as opposed to a front line adjudicator.

[Baz1994]

Absolutely brilliant help ims as usual and thanks for your time in responding to my neverending questions.

 

It has all rather become frustrating on the PPI part and as you said,

I do want shot of this lot but then again wouldn't mind some extra cash in my pocket now.

I was surprised that they refunded all my fees and charges as I only decided a month or so ago to pursue this avenue.

 

I will just have to await FOS outcome and will keep the forum up-dated of any developments but can see this dragging on a bit.

 

g/l and atb

[ims21]

[Baz1994]

Has anyone challenged Welcome regarding the legality of charging a Mortgage Indemnity Fee and been successful in reclaiming ?

 

I have been searching various threads but most seem to end without any conclusion.

 

Any comments or advice would be appreciated.

[Baz1994]

I originally submitted a PPI mis-selling claim with Welcome Finance in which they originally up-held

then decided to pass details to Dial4ALoan (same address as Welcome),

 

who I then received a response stating that they were not regulated at time of sale (November 2003)

 

and therefore PPI claim rejected.

 

I had no prior dealings with Dial4ALoan or ever received any correspondence from them

but I do remember only dealing with Welcome who contacted me to confirm loan was successful.

 

So on that basis I submitted two SAR's, one to Welcome and the other to Dial4ALoan.

 

Firstly received details (lack of it) from Dial4ALoan, which consisted of a copy of a completed FOS PPI questionnaire that I had originally sent to Welcome (who had passed on to Dial4ALoan),

 

various internal commission sheets (some with Welcome Finance Services printed on them)

between them and Welcome and an internal processing sheet with no figures but with various abbreviations and notes.

 

There is some information on the sheet stating that loan had been reinstated with WFS ?

There are no original loan application details or anything confirming details sent to my address from Dial4ALoan ?

 

Secondly I received the Welcome SAR details and amongst various documentation,

I have located a A & T Finance Loan application dated September 2003,

in which I recall was unsuccessful due to lack of equity in my property at time.

 

I do also remember Welcome contacting me and selling the PPI product,

for the eventual loan to be successful but they never explained terms and conditions of policy,

and I have recently found out that is was only for 5 years and not to term end.

 

Does anyone know if Welcome Finance own Dial4ALoan as they are now no longer trading ?

Has anyone experienced a similar situation and can kindly shed some light on where I stand or what to do next ?

 

I am becoming rather frustrated with this lot as

 

today I have received a further letter from Welcome re SAR,

saying that they do not have to disclose or keep any information older than six years as per ICO website ?

They also state that data that was sent confirms that Welcome were not involved in the policy sale

and that it was sold by Dial4ALoan, who I had no prior dealings with.

 

Sorry for long post but any help would be appreciated.

 

 

 

I also sent a letter to Aviva / Norwich Union the Underwriters who also rejected complaint

as they were not responsible for the sale and that I should pursue Welcome as they were regulated in November 2003.

 

Any comments or advice would be very much appreciated.

 

g/l

[dx100uk]

sri didn't see this

 

gather from many sources

 

http://www.consumeractiongroup.co.uk/forum/showthread.php?318323-Old-Welcome-Debt&highlight=postggj

.

http://www.consumeractiongroup.co.uk/forum/showthread.php?304631-Welcome-Finance-PPI-and-Mr-Z&highlight=reclaim+MIF

.

http://www.consumeractiongroup.co.uk/forum/showthread.php?251405-Welcome-Secured-Loan-agreement.

http://www.consumeractiongroup.co.uk/forum/showthread.php?304631-Welcome-Finance-PPI-and-Mr-Z&highlight=reclaim+MIF.

.

As per the post above the MIF is not for insurance. Welcome have admited on more than a few occassions that it is not insurance....Never has been, never will be.

.

The real question is where does the money go? They will tell you its a fee in relation to being a higher risk, and that by charging this fee, and the interest it attracts, it helps to cover them in the event of a shortfall. They will also tell you that whilst many lenders do use the fee to purchase insurance, they never have.

.

This is not only stated in the Griffith v Welcome case, but I also have it in writing directly from them.

"The MIF is a fee that can be charged by lenders when the value of loans secured on a property is at a level similar to the value of the property.

.

It is an additional form of protection for the lender in the event that they are required to repossess the property and are unable to recover all of the monies are outstanding under an agreement (i.e. there is a shortfall).

.

In such circumstances, the lender is entitled to pursue the borrower for the shortfall.

.

As can be seen by the terms and conditions of your agreement, you were charged a MIF, which meant that should the situation described above arise you would not be pursued for any shortfall.

.

This was not an insurance policy although some lenders do take out insurance policies for this purpose.

.

It was what could be described as a 'waiver fee'. It was decided in Griffiths -v- Welcome Financial Services (2006) EWHC 3769 (QB) that the charging of the fee by a lender but not actually taking out an insurance policy was entirely reasonable."

.............

collected from some thread on here .

.

dx

.

The MIF has not been tested in court as far as I know, I certainly will be testing it though, its a big part of my claim against them.

..

 

Last edited by MrZ; 16th August 2011 at 19:35.

.

I too am uncertain of the legalities regarding the MIF.

.

I have seen and read the threads I can find about it.

.

I started a separate thread, which is now merged with this one specifically asking about the MIF.

.

This is what I have been able to gather so far pertaining to the MIF.

.

1. Its been said that it should only be applied to mortagages or secured loans of 25,000.00 or more.

(I have not seen and regulation yet that states this)

.

2. Its been said that it should be 75% loan to value (I have not seen any regulation that states this)

.

3. mortgage Indeminty Fee is a fee to be used to purchase insurance.

(This is not a regulation per se, but rather an industry norm.

mortgage lenders will charge this fee and then use the fee to purchase insurance to protect against a shortfall)

.

4. In the case of Welcome, they are not using this fee to purchase insurance.

(I have yet to see any explanation from Welcome as to why they charge the fee)

.

5. Welcome are treating this fee as a Charge for Credit and it attracts interest at the same daily rate or AIR.

.

So having gathered the above information from this forum and other resources,

it is my intention to write Welcome regarding only the MIF.

.

I will not include it as part of any other complaint or claim,

as I want to ensure it doesnt get "muddled over" or lost amongst other issues.

.

I dont want to give them room to wriggle out of an explanation.

.

I am drafting the letter today and will definitely update this thread once I have a reply.

.

MIF is a fee the debtor pays incase there is a shortfall on the loan

.

this fee is an insurance policy/product

.

you paid for it so ask welcome for the insurance policy.

i can tell you now there will be none

.

it goes into welcomes own pot under WELCOME ELITE BROKERS

.

YOU NEED TO BE ASKING WELCOME WHO THIS MONEY WAS PAID TO AND DEMAND PROOF VIA ANPOLICY NUMBER AND DATE AND WHO THIS FEE WAS PAID TO

.

ILL LAY EVEN MONEY NORWICH UNION/AVIVA

.

[Baz1994]

Cheers dx much appreciated, I Will have a read through.

 

[hillards]

If it's any good, have a read of the OFT page at http://www.oft.gov.uk/news-and-updates/press/2004/202-04 - Dial4ALoan are shown there as being owned by Cattles PLC, which also ran Welcome Finance, CL Finance, Lewis Group and more.

 

Unless anyone has any better suggestions I would suggest a complaint to the FOS and send in a copy of their questionnaire so they can follow it through. Although Welcome provided the finance, Dial4ALoan customers have also had finance via other companies, so it wasn't an in-house operation as such.

 

But, more recent info shows that Dial4ALoan are still trading, having submitted an annual return to Companies House as recently as April this year. CH records them as

DIAL4ALOAN LIMITED Company no 03958533

Registered Address: Welcome Finance, Mere Way, Ruddington Fields Business Park, Nottingham, NG11 6NZ

Here's just one of the many on-line checkers: http://www.companiesintheuk.co.uk/ltd/dial4aloan

 

Some Welcome cases are being dealt with via the FSCS but it seems your own account is older than the ones they will deal with. Having said that, so was ours, and we managed to reclaim the PPI on a Welcome Finance agreement quite recently, although ours was signed directly with them through one of their own offices. see http://www.consumeractiongroup.co.uk/forum/showthread.php?415458-Welcome-PPI-claim-pre-2005&p=4480621

[Baz1994]

Thanks Hilliards for your response.

 

PPI claim is already with FOS but I am still trying to collate as much information as possible.

 

All seems a bit confusing as all parties including Underwriters are blaming each other.

Sale was done over phone and by post with Welcome but

 

prior to that we had completed an A & T Finance (presume they are a broker ?) application which was unsuccessful

but it somehow seems to have been passed to Dial4ALoan without our knowledge,

and there are some internal commissions between the two parties,

hence my question regarding their relationship.

 

FOS called me yesterday regarding complaint, and said that Welcome are not responsible for the sale of the policy as they are the lender ?

The only correspondences received are all from Welcome apart from an initial covering letter from

Progressive Financial Services / Welcome Financial Services / Dial4ALoan,

Registered address Kingston House, Centre 27 Business Park, Birstall Batley.

 

They also mentioned something would be required to connect Welcome and Aviva / Norwich Union the Underwriters

in order to pursue that route.

 

Any idea what would be needed to prove this

 

- would it be Underwriting sheets ?