Waxsyd vs Nemo - PPI help & info needed

[Waxsyd]

Hi All

 

I've done a fair amount of reading through these threads re PPI and would very much appreciate any help & advice from anybody re my situation.

 

I rather stupidly took out a loan from Nemo Personal Finance, secured against my property, back in March 2006. I initially requested to borrow £41K, was turned down but offered £40k at a higher interest rate and told I needed PPI to get loan. I agreed! All this was done over the phone.

 

My copy of credit agreement reads:

 

'Secured by a legal charge or standard security (Non Regulated)

 

Cash Loan Amount £40,000, PPI £9,900 , total loan £49,900.

Monthly Int Rate (variable) 0.8310%, APR (assumes no variation in rate) 10.4%.'

 

Regarding PPI it states:

 

'Assuming you keep to the term of the agreement and that interest rates do not vary, this interest would be £16201.44. The total price you would pay for cover is £26,101.44, this will however change if interest rates change.'

Well the interest rate has now increased to 10.972% so guess this has too. My total monthly payment is just short of £500.

 

Obviously it states on the credit agreement 'Optional Payment Protection Premium', but in my case I dont believe it was optional. I wouldn't agree to a premium of nearly £10k (one quarter of the loan amount) for this type of cover. £26K (over half the loan amount including interest). But unfortunately I guess I did by not cancelling within the 30 day period. I did speak to them a little while ago and was told that if I cancelled the policy my monthly payment would only slightly decrease. I think the documentation states that I would only get around 13% of the total premium back.

 

So my questions are:

 

1. Is this mis-selling as it didn't appear to be optional in my case?

 

2. Should interest be added to the premium amount, if so, isn't this a little high?

 

3. What does the 'Non Regulated' bit mean?

 

I really hope that someone can give me a bit of guidance on this. The £500 every month is hard to make and a reduction would be of so much help.

 

Wax

[buggerlugs1]

Morning Waxsyd

 

As far as I can ascertain it is not illegal for a financial instituaion to make taking their PPI a condition of giving you a loan. However, if they do this, then the premium for the PPI should be included in the total charge for credit and thereby the APR. From what you have said, it appears that Nemo have added the PPI premium to the loan advance which is incorrect. The same thing happened to me, the loan company (GE Crapital in my case) said I couldn't have a loan unless I took their PPI, but they didn't tell me they were going to charge the full premium up-front and that I would then be paying interest on it aswell. From what you have written, I would say that yes, the PPI was mis-sold.

 

The 'Non regulated' phrase appears because your loan was for over £25,000 and the Consumer Credit Act only applies to loans of up to £25k. I'm not sure how that effects you legally, perhaps someone with more legal knowledge can answer that one.

 

As your loan was only taken out last year, it should fall under the remit of the Financial Ombudsman Service (FOS), Financial Ombudsman Service. If I were you I would try complaining to them prior to any court action, as their service is free, but before you do anything, make sure you have a good read around on the Consumer Action Group website.

 

Best of luck,

buggerlugs:)

[Waxsyd]

Hi Buggerlugs

 

Thanks very much for taking time to read my post and for your input.

 

I'm at very early stages with this and at this point I haven't written to anybody yet. I just want to see if I may have a case. I'll do a bit more reading around the other threads but would appreciate any extra info anyone else who reads may be able to offer.

 

Thanks again

 

Waxsyd

[Waxsyd]

Well, read quite a bit now and I'll take one step at a time.

 

So firstly I need to write and cancel the policy and see what happens from then.

 

Ta again

[Waxsyd]

Found the booklet I received re the PPI which says that if I wish to cancel the policy prior to its natural 60 month term, I will be entitled to receive a refund of premium, which will not be a proportionate amount of the premium I originally paid.

 

The refund amount would be credited to my agreement and my monthly repayment would be recalculated. It states that after 12 repayments a 13% refund applies and after 24 repayments an 8% refund applies.

 

I'm rather confused really. I'm about to cancel the policy, if they'll let me, and then go for the mis-selling route etc as In my case it wasn't given as an option. Would the total PPI amount (£9.9k) be taken off the total loan and then the monthly repayments recalculated or would I receive the PPI premium back (lump sum).

 

Obviously a 13% refund is very poor.

 

Sorry if I appear a bit thick on this, I feel a bit out of my depth with this one.

 

Hope someone can give me some good advice, thanks in advance ....... anyone!!!!

[buggerlugs1]

The FSA have recently issued guidance about the issue of nil or token refunds of PPI premiums: Payment protection insurance (PPI) – Refunds of single premiums : FSA Money made clear – Unfair contracts. Basically they are of the opinion that the companies should give a fair refund.

 

Best regards,

buggerlugs:wink:

[Waxsyd]

Hi Buggerlugs

 

Thanks again for your input.

 

After reading through the FSA articles I feel I understand a bit more now so first things first I'll write to cancel the policy.

 

I'll keep you updated of my progress if that's ok?

 

Waxsyd

[di0430]

Hi and sorry to hear of your problems with 'Nemo'.

 

We have our complaint about Nemo in with the financial ombudsman at present due to us being mis sold a ppi policy.

We were told we had to take their recommended cover and as you know it is very costly, we even told them we can get a cheaper cover option else where, but they were not having it, and they left us with know choice.

I am wondering 'it wasn't a Sarah' you spoke to is it ??

 

If you want to know more - please get back to me.........I have lots to say about this company, this complaint has been with the ombudsman since last October and you also had a choice too, you didn't have to take their cover, so in my opinion this was mis sold to you.

 

Luckily we have recordings, so you should do to, so if you are going through a complaint with them and with no success, please ask for the disk so that you have this to take this further.

Unfortunately on some recordings some bits of conversation seems to have been erased, but the caseworker did pick up during the conversation where this was pushed on to us, should be the same for you too.

 

Good luck and please get back to me, thank you I look forward to hearing from you - please don't leave it there.............its your money and your choice

 

Cheers Di xx

[Waxsyd]

Hi

 

Have now had confirmation of cancellation from Nemo who state that they will refund just over 1K back to the account and knock it off the balance! This will reduce the monthly payments down by about £18.50 which funnily enough is the exact amount I was paying before a recent percentage increase. I thought I may be due to get more than 1K back. Is it correct that it should just come off the whole balance?

 

I have not been asked to take out a new loan or sign a new credit agreement etc.

 

So I think now I should get a S.A.R and take it from there.

 

Any input would be greatly appreciated

 

Ta

[Waxsyd]

Hi There

 

Just an update and questions etc.

 

This has all been going on for ages now but after complaint through FOS I have been notified that the broker, not Nemo (the lender), have accepted responsibility for misselling and will pay back the whole premium originally paid on top of the loan. They will also pay me the total amount including interest I have paid to the lender in respect of the borrowing for the PPI premium plus interest at 8%.

 

As I still have the loan the broker want to pay the premium back to the lender so the loan will be reconfigured as if I'd taken it out without the PPI. Thing is I dont trust Nemo as they have hiked the interest rates continually as they did when I originally cancelled the PPI policy and I fear they will do it again and I will lose out. The broker wanted me to sign a declaration to accept the proposal before I saw any figures but I declined through the FOS and highlighted my concerns who then asked the broker to put together some figures. This was 2 months ago and I've heard nothing from the broker or the lender. FOS say that the broker is waiting for Nemo to get the figures. Cant understand why it takes all this time when recently I obtained a normal settlement figure for the loan through the post within 2 days.

 

Anyway, I wanted to know if I'm able to make demands to have the whole premium paid back to myself instead of the lender. I feel that as I was charged for it originally I should get it back and if I want to pay it off against my loan then that's my decision.

 

Should I threaten court action if not paid within a time limit etc? Am I within my rights to do this?

 

Any help would be appreciated.

 

Thanks in advance

[alanalana]

hello wyxsyd,

 

Hi There

 

Just an update and questions etc.

 

This has all been going on for ages now but after complaint through FOS I have been notified that the broker, not Nemo (the lender), have accepted responsibility for misselling and will pay back the whole premium originally paid on top of the loan. They will also pay me the total amount including interest I have paid to the lender in respect of the borrowing for the PPI premium plus interest at 8%.

 

As I still have the loan the broker want to pay the premium back to the lender Tell them to go away it is your money not the lenders and certainly not the brokers so insist on a personal cheque payable to you so you can put your money where you want to put your money. so the loan will be reconfigured as if I'd taken it out without the PPI. Thing is I dont trust Nemo as they have hiked the interest rates continually as they did when I originally cancelled the PPI policy and I fear they will do it again and I will lose out. The broker wanted me to sign a declaration to accept the proposal before I saw any figures but I declined through the FOS and highlighted my concerns who then asked the broker to put together some figures. This was 2 months ago and I've heard nothing from the broker or the lender. FOS say that the broker is waiting for Nemo to get the figures. Cant understand why it takes all this time when recently I obtained a normal settlement figure for the loan through the post within 2 days. If the FOS result is mis-selling then you can request payment by a personal cheque and you can deposit that cheque wherever you wish:)

All of the above is a standard delaying tactic the banks hate paying out cheques or payments into your account and will do all they can to delay delay delay:shock:

Anyway, I wanted to know if I'm able to make demands to have the whole premium paid back to myself instead of the lender. IMO you can request mis-sold PPI to be paid by whatever means suits you and not them it is your money taken in most cases illegally and therefore you decide how you want it refunded. I feel that as I was charged for it originally I should get it back and if I want to pay it off against my loan then that's my decision. Absolutely the correct decision IMO.

Should I threaten court action if not paid within a time limit etc? Am I within my rights to do this? You can go to Court or you can go to the Financial Ombudsman Service and then Court that way you get two bites of the cherry if you go to Court and lose on a point of legallity then that is that if you go to the FOS and the complaint is not upheld then you still have the court option.

 

Any help would be appreciated.

 

Thanks in advance

 

I have three complaints with the FOS two upheld:D both submitted in august 08 settled dec 08 one complaint referred to the Information Commissioners Office who were already dealing with the same complaint.

 

hope I have helped you keep posting;)

 

aa

[Waxsyd]

AA

 

Thanks ever so for your input & advice.

 

I'm going to speak with FOS and then demand payment from Broker straight away.

 

I'll keep you posted on outcome etc.

 

Thanks again.

 

Wax

[scottishsodapop]

H i just found your post was just making my subject accesss request up for nemo wen ran across ures

like wise we were told no ppi no loan i have quotes ere with ppi already added for varying loan amounts

also found letter from central trust who orgnised loan sorry we forgottogive you a IDD document which details ppi amount and at bottom it says agreement non cancellable does any one think this will help our case

 

 

ooh sorry for jumping on your thread

[Waxsyd]

I sent S.A.R to Nemo at first but got a call from them telling me to do it with Central Trust instead. Nemo sent back cheque for £10!

 

Got all telephone conversations supplied from CT for the time when the loan was arranged. Well I say all, but one part of the sales pitch was missing and it was the crucial bit. Once they admitted they could locate no more recorded conversations I put in complaint with FOS. It took nearly a year for FOS to allocate it to an ajudicator.

 

In my opinion you should do the same cos Nemo will pass the buck to them anyway if they were the broker who sold the policy. Nemo are just the lender. I cancelled my policy when I realised but it made no difference to monthly repayment cos Nemo hiked the interest rate anyway and have continued to do so since.

 

Just get in there quick cos it takes a long time.

 

Wax

[Goldlady]

Subscribing to your thread.

[skeptic]

 

I cancelled my policy when I realised but it made no difference to monthly repayment cos Nemo hiked the interest rate anyway and have continued to do so since.

 

Wax

 

Did they, now. That might not have been their best course of action...

 

Nash & Ors v Paragon Finance Plc [2001] EWCA Civ 1466 (15 October 2001)

 

"I would hold that there were terms to be implied in both agreements that the rates of interest would not be set dishonestly, for an improper purpose, capriciously or arbitrarily. I have no doubt that such an implied term is necessary in order to give effect to the reasonable expectations of the parties." per Dyson LJ @ para 36

 

[following Leggatt LJ in The Product Star, who held that where A and B contract with each other to confer a discretion on A, the discretion must be exercised honestly and in good faith, and not "arbitrarily, capriciously or unreasonably".]

 

Dyson LJ goes on to add to this by stating that a "Wednesbury"-type unreasonableness term can also be implied... but this technical argument is complicated and probably irrelevant to you.

 

Simply put, if a Lender exercises his contractual power to vary interest rates, dishonestly, for an improper purpose, capriciously or arbitrarily, he will be in breach of an implied term of the agreement and liable to the Borrower for damages.

 

If the cancellation of your PPI or the making of a complaint relating to it, co-incide very closely in time with them raising your interest rates, I would be considering whether the Court could be persuaded to infer that they increased your interest rate to penalise you for exercising your lawful right and that it was therefore either dishonest, for an improper purpose, capricious or arbitrary. (Particularly, as now, interest rates have been falling steadily for a while to the current all time low.)

 

Knowing the legal position is one thing. Proving this, in practice, quite another. (Although finding other people, perhaps thru a consumer based web-site, who the Lender has done this too in similar or identical circumstances and who would be prepared to sign a Witness Statement to that effect, wouldn't do you any harm).

 

At the moment, I'd recommend you keep this card up your sleeve for the time being... certainly until after you get the money from the Brokers and the PPI reclaim is settled... and bear in mind that:

1. Your Loan is not a CCA regulated agreement, therefore you do not benefit from the protection of the CCA
   
2. Your Loan is for a suffiently large amount of money that you ought to get yourself some formal Legal advice before taking any steps connected with it.
   

[skeptic]

It may also be worth posting the part of the T&C which provides them with the power to vary your interest rates.

[Waxsyd]

Thanks very much for your reply and advice. Trying to find T&C at moment, when I do I will post the relevant bit.

 

Still haven't got any figures for repayment from broker because they are blaming Nemo for stalling on it. I've been onto FOS and have asked for contact details of broker (Central Trust) so I can complain and request an immediate payment via cheque to myself. FOS are reluctant to give details as they say it will be sorted soon but their recommendation is that the loan is redressed and the PPI amount is taken off. FOS say this is the best course of action so it makes the loan like it would have been if I hadn't had the PPI. Because of my concerns with Nemo etc I dont want this to happen and want the payment via a cheque to myself.

 

I want to write to Central Trust and demand payment straight away by cheque or I will take further action through court.

 

Is this a good move? Can I legally do this?

 

In a bit of a stuck with all this. I fully appreciate the work that FOS has done for me but their recommendation and conclusion is not what I wanted.

 

More help and advice appreciated.

 

Thanks in advance.

 

Wax.

[skeptic]

FOS are reluctant to give details as they say it will be sorted soon but their recommendation is that the loan is redressed and the PPI amount is taken off. FOS say this is the best course of action so it makes the loan like it would have been if I hadn't had the PPI.

 

As I understand it the FOS have indicated that the Broker will be repaying the whole of the PPI + the interest on the premiums + 8% and based on the figures in your first post and this equates to somewhere around 15.4K (using the very round figures of 10K PPI, + 3K interest charged (3yrs @ 10%) + 2.4K interest lost (3yrs @ 8%)).

 

Judging by the interest rate and total cost of the interest on the PPI (over the lifetime of the loan), this is:

1. A very expensive loan (by current secured loan rates)
   
2. A loan which runs over a long time
   

In the circumstances, I can see where both you and the FOS are coming from.

 

I understand why you don't trust them and want a cheque... but I can also see how paying this off of your debt is likely to be a WAY better solution than spending it on anything else.

 

...and getting a decent whack off the capital of the loan, may help you to find an alternative cheaper source of funding.

 

Because of my concerns with Nemo etc I dont want this to happen and want the payment via a cheque to myself.

 

I want to write to Central Trust and demand payment straight away by cheque or I will take further action through court.

 

Is this a good move? Can I legally do this?

 

In a bit of a stuck with all this. I fully appreciate the work that FOS has done for me but their recommendation and conclusion is not what I wanted.

 

Legally, your recourse is to the Courts. The decision of the FOS does not, as I understand it, have the force of law.

 

However, the FOS decision does seem to include most or all of what you could expect to get if you were successful in Court; and if you do get the money as a result of the complaint to the FOS, a Court would take this award into consideration when assessing your damages.

 

Starting proceedings now, with all the risks this entails, including that it is likely to delay rather than speed receipt of the funds, seems to me like an inadvisable course of action.

 

If it were me, I'd be on the phone to the FOS every day, asking what progress had been made, who they'd spoken to at the Brokers, what the delay was etc.

[Waxsyd]

Sorry I haven't replied but my broadband has been down for a while.

 

Skeptic,

 

Thanks for your advice and knowledge. I now have some figures from the broker for the compensation and the amount required to restructure the loan.

 

Not sure if they are quite right though. Is it possible to email you the PDF with figures etc and I'll explain my concerns.

 

Wax

[papadak]

Hello, do you have any updated on your situation here?

[jediuk]

my claim with nemo was turned down by FOS due to time lapsed since their final answer!! should i take them to court what chance is there of winning?