Tried To Claim For PPI And Failed? With The New Laws, You Can Claim Again


Posted: 21st July 2017 & filed under PPI

Tried To Claim For PPI And Failed? With The New Laws, You Can Claim Again

The Legal Landscape for PPI Claims has changed in the recent times and you can now use the new laws to review previously rejected claims. The judgments in Plevin vs Paragon Personal Finance allows people to bring an unfair relationship claim based on non-disclosure of commissions. As a result previously rejected cases can now be re-opened on fresh grounds of complaint. If you have had a prior claim for PPI rejected by your bank or lender, then you can take this opportunity to make a reclaim now.

New Opportunities

The opportunities to re-examine old PPI cases fall into three categories:

“Secret Commission” Claims

This recent change in law has established that a Bank’s/Lender’s failure to disclose commission earned on the PPI policy sale may allow the customer to argue that the sale of the PPI was unfair under the rules of the Consumer Credit Act. It is believed that 40% of all credit cards and personal loans fall within the scope of the Consumer Credit Act. This newly introduced law means that previously rejected PPI claims can now be re-opened on fresh grounds of complaint that the sale was unfair due to “secret commissions” that were made to your banks/lenders.

Your claim will be reviewed to check if it falls under the new law and will afterwards be re-submitted. If your claim is successful, your lender will be forced to pay you full compensation along with a statutory interest of 8%.

Cases Rejected For Having No PPI

A number of big banks have been fined for failing to handle PPI claims fairly. The biggest fine was made against Lloyds Bank but they haven’t been the only culprit. You now have a free PPI check facility online with some claim management companies where they conduct full searches with the majority of banks to find full details of accounts going back to the mid 1980’s and check if you have been mis-sold PPI. This is a relief for those who don't have account numbers or documents to conduct these searches.

Many people had tried earlier to claim but were told by their bank that they didn't have PPI. When checked online, it was found that they had been sold PPI. These previously rejected claims can be re opened now.

Claims Settled With “Goodwill” Payments

In the early days of PPI claims many customers were fobbed off with Goodwill payments of compensation where they were unfairly just paid with £500 or £750. It is unlikely that that payment represented the full value of their claim and was unlikely to have included the statutory interest of 8%.

If this happened to you, speak to a reputed claim management company as they may be able to force the banks to re-investigate claims wherein you may have already been paid out but you may have not received the full value that you were entitled to. 

Reclaimed PPI? Banks are Underpaying


Posted: 20th July 2017 & filed under PPI

Reclaimed PPI? Banks are Underpaying

It is very likely that you are owed £100s or more if Barclays, Lloyds or RBS/NatWest have offered payment protection insurance (PPI) redress on any loan that you might have taken since 2012.

As the PPI scam unfolded it was discovered that big banks sometimes underpaid by almost a third. This basically means that people who have been repaid already are due £100s or £1,000s more.

In order to be compensated properly, here is what you will need to know.

Who is more prone to be affected?

PPI reclaims is mainly for people who have availed loans from 2012 onwards and those primarily affected by this are customers of Lloyds Banking Group and Barclays which also includes Black Horse and Halifax and the RBS Group which comprises of NatWest, although it can consist others as well.

All those who were affected will also chiefly be borrowers who received a PPI offer from the bank and did not go through the Financial Ombudsman Services.

The providers of these services are well within their rights to offer comparative redress which are stated under the Financial Conduct Authority's (FCA) rules, as long as they go on about it “fairly” and constantly.

Understanding the Problem?

Some people could only receive partial funds because of the lenders reasoning that they were sold the “wrong type” of PPI instead of the “completely mis-sold” PPI. In such cases, lenders offered borrowers with ‘comparative redress’, also known as ‘alternative redress’ which is essentially a partial payment for those who had to pay all the PPI upfront (known as single premium) rather than charged on a monthly basis.

This basically means, on a loan of £5,000 if the full PPI refund is around £1,200, the comparative redress will take away around £500 away from your offer, leaving you with a refund of £700.

Reclaiming PPI in the First Place

If you have ever availed any type of loan or owned a credit card, check to see if you were mis-sold PPI. One of the most common complaints is that consumers were told that they had to necessarily purchase a policy from the same provider as the loan in order to be eligible for the product. This is blatant mis-selling.

What do the banks have to say on the matter?

Barclays claims that it paid comparative redress in less than 5% of claims of PPI claims and that it aims to put into practice the FCA's guidance acceptably rather than being motivated financially.

The FCA handbook is absolutely clear that in these specific circumstances, the provider must offer redress that places the customer in the position they would have been in had the customer availed the regular premium policy.

Additionally, the numbers for overturn rates can potentially be misleading. The overturn rate for loans claims is similar whether it is for comparative redress or for any other reason.

Majority of the providers following the FCA guidelines use comparative redress in minority cases which are in line with the criteria laid down by the FCA in Policy Statement 10/12.

Aamir Sheikh

What is the Impact of the Plevin Ruling for PPI claimants?


Posted: 19th July 2017 & filed under PPI

What is the Impact of the Plevin Ruling for PPI claimants?

The regulator is cutting off PPI reclaims, so if you have or ever had a loan, mortgage, credit or store card, overdraft or a catalogue debt, take note. Even if your claims have been rejected, you can reclaim.

Here are the 5 things you must know about PPI reclaim:

1. Now just having had PPI means you were mis-sold

2. Deadline is 2019, but act ASAP to beat the queue

3. Don't assume 'it's not me' - even if you have said no to it.

4. You can use our free online tool to check PPI.

5. A typical payout is around £3,000 and therefore it is worth your time.

Now, just having PPI means that you were likely mis-sold the policy by your bank or lender. Within the deadline announcement, a new mis-selling category called 'Plevin' was confirmed. It comes into effect by 29 August this year.

This Plevin ruling means if over 50% of your PPI policy’s cost went as commission to the lender without your consent, you are due back the extra above that. For this to count, your PPI has to have still been active at some point since 2008.

Staggeringly, with a PPI policy attached with a loan, on an average 67% of what you paid was pocketed by banks as commission from insurers, and banks almost never mentioned it in their papers. So, millions more people are owed possibly billions of pounds in compensation.

On a £10,000 loan over five years, your 'Plevin' compensation would typically be around £500 (if you're due all the PPI back for other mis-selling, you don't get both).

Lenders are forced to write about Plevin to 1.2 million people who've had their claims rejected in the past. Yet if you've never complained, but are owed, bizarrely you won't be told and you need to take it up.

The Key Steps to Reclaiming PPI

There’s no time limit on PPI reclaiming - you can go back as long as you like, as long as you’ve evidence.
Check all old loans, credit cards, mortgages, store cards and overdrafts to see if there was PPI policy attached with any of them. It will have been called something like accident or sickness cover" or "payment insurance".
Check if you were mis-sold. Typical examples of mis-selling include if you were told that PPI was compulsory or that it'd cut your loan costs - sometimes it was added without asking, or even after you'd said no. They had a duty to ensure it was suitable for you. It may not have been if, for instance, you were self-employed but got unemployment cover.

Make a claim yourself with FOS (Financial Ombudsman Service) or take help of a claim management company.

3 Things You Might Not Know About Your PPI Compensation


Posted: 18th July 2017 & filed under PPI

3 Things You Might Not Know About Your PPI Compensation

You might have received your banks offer of PPI compensation and must be salivating at the thought of this unexpected and significant source of income, but the reality is that once you get your hands on your compensation, you might be faced with other eventualities. We discuss these scenarios in detail here.

Your PPI Compensation is Taxable

The Government has confirmed that Millions of victims of payment protection insurance mis-selling will have to pay tax on their payout.

Anyone who gets interest back on top of the compensation amount is liable if they are a taxpayer. The compensation itself is not taxed so any money you owe will be a small proportion of the overall payout.

Some PPI sellers deduct taxes from redress, but not all do, meaning many will have to make additional payments.

Banks, building societies, credit card firms and other lenders have paid out for mis-selling for years but there has been a huge build-up of momentum following the collapse of the banks' attempt to block automatic payouts in May.

An estimated 3 million people could be due compensation which means a windfall for the Taxman.

Here's what you need to know:

Who Owes Tax?

Interest on PPI compensation is treated as savings so all taxpayers who are paid additional interest will owe tax.

This is because the idea of compensation is to put you in the same place you would have been, had you not been mis-sold PPI. Had you not paid out the PPI premiums it is assumed you'd have that cash in the bank. Additional interest is paid as compensation as it is assumed you'd get a return on that money in the bank.

Therefore, it is taxed same as a savings account would be.

However, interest is not paid on credit card PPI redress always. Where it is not paid there is no tax owed.

How to know if I've You have been paid interest?

It should be split out from the compensation on your redress offer letter from your lender.

PPI Refund when Loan is Paid Off Early

In several cases, the PPI premium is charged in one single lump sum, called ‘single premium.’ This premium is added to the loand sanctioned. According to this, you can also say that the monthly payments that the buyer makes towards the cost of the insurance are not really the premiums, but additional loan repayments.

This means that the buyers don’t have the option of just stopping their PPI paymentsing for PPI. Instead, they are supposed to get a refund. However, this refund may be refused or amount to a sum which is too less for you. Most of the consumers argue that such arrangements are unfair, especially if the loan is paid off early in order to restructure the debts. In these circumstances, the individual facts of the case are considered, which are particularly things told to the customer while being sold PPI. Hence, if the lender did not explain all this to the buyer, they have to pay the additional interests and premiums to the buyer along with the principal amount of refund.

The State Adds To Your Compensation

When it comes to claiming a PPI refund, it is not just the financial institutions and the banks who come into the picture of making sure you are repaid a sufficient amount. The State also adds a portion from its wealth when you make a PPI claim. Currently, it is set at 8% of the principal amount that is to be repaid to you. Also, in the case of severe illness and emergency, the State may also offer various welfare benefits along with your compensation. Hence, there is a little you need to worry about if you are certain that you were mis-sold a PPI policy.

Why You should Choose a Claims Management Company?


Posted: 17th July 2017 & filed under PPI

PPI claim: Why You should Choose a Claims Management Company?

Claiming for PPI compensation could turn out to be an intricate process for some consumers. There might be huge amounts of their money at stake along with complex disputes for and against whether PPI was mis-sold to people or not.

While you might have read about certain Claims Management Companies providing poor customer service, yet there are several who strive to offer specialised service to consumers who ask them for help with their respective PPI compensation claim.

So, what benefits could you receive by employing a Claims Management Company specialised in PPI compensation claims?

Specialisation

Claims management firms can work across a wide range of areas, which mainly includes personal injury and PPI compensation claims. Some firms even work on all claims, which involve lawful process or problems, but you may also find companies that specialise in a particular area. By choosing a professional claims management company you’re bound to benefit from their in depth knowledge and specialisation.

Know the System

The “system” of claiming for PPI compensation should neither be difficult nor intricate and still there are certain cases that require a longer period of time to resolve. This is mainly because some of the problems can create complications in not only deciding whether the compensation is due, but also what happens when a consumer is willing to refute their case of rejection. A claims management company can easily understand the system, as they would’ve worked on several claims relating to the PPI mis-selling scandal.

Support

At times a consumer might require support and information. A claims management company might not advice you on what you have to do about the PPI compensation claim, as that is completely up to you. But, they’d definitely ensure that you have all the information required to make a well-versed choice, especially the one that’s right for you. And, they’d also do this without any obligation in order to continue your claim.

Claim Management

A claims management company can handle the entire case on your behalf, thereby leaving you free so as to carry on with other important tasks. The firm also understands that every customer is busy who might not have the required time nor the inclination to run behind banks and providers to get their money back after being mis-sold. They’d do whatever is required as it’s a part of their comprehensive service to every consumer, no matter how big or small their claim is.

Experienced

When it comes to PPI compensation claims a claims management company could be the right choice, especially because of their years of hands on experience. They would’ve worked with thousands of consumers for several years to assist them claim their cash back and this is another reason why going to a claims management company could be a wise decision. 

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