In the four years that I've been writing this blog, I've been in debt. My Dad has always been fond of the old joke "Son, you've been in the shit since you were born. It's only the depth that's changed." and the old man was right. For some reason or another, usually my temper, I've managed to snatch defeat from the jaws of victory again and again, never more so than with my finances.
Well, for once, Mr and Mrs Magna's little boy has had a little tickle that puts him ahead of the game. Or at least, back to just above zero with a little pin money thrown in.
First of all, I feel compelled to justify chasing this particular ambulance.
Payment Protection Insurance was sold to me, as a comforting thought that should something happen, I wouldn’t need to worry about the loan. It may cost around 15 to 30% of the loan but that just goes to show how important it is to have!
Hypothetically speaking, I’m a 25 year old man, employed full time in a skilled job for the biggest company in the town. I’m also physically fit... Hypothetically speaking.
Do I need PPI on the £1000 loan?
This shouldn’t be a difficult question as you, the bank, are the people I rely on to steer me straight when it comes to money. Every single one of your adverts on the goggle-box tells me so.
You were wrong when you told me “Yes, Mr Magna. You need this PPI.”
I don’t blame the woman that sold it to me; I blame the people behind her that said “Get this PPI on every loan you sell” which gave the PPI a false air of credibility.
PPI absolutely did not apply to me.
If I was made redundant, my redundancy pay would cover the loan whilst I found a new job. Point of interest, I have never been out of work.
If I was sick I would receive full pay for the first 12 months. Slightly reduced thereafter.
If you get sacked the PPI doesn’t cover it.
Why did I need this PPI again?
I posted the first part of this a couple of months ago and not surprisingly considering the title, it attracted a couple of spam comments from PPI Claims Merchants.
If you take one thing and one thing only from anything I write on here then heed this: Do not, ever, use a no win no fee bunch of fly by nights to reclaim your cash.
If you have been mis-sold PPI then getting that money back won't be difficult and there is no earthly reason to give YOUR money over to these chancers on the telly. My claim took me the sum total of an hour and a half. Half an hour's research on the internet, another half hour looking at my accounts and the next half hour on hold to the bank's direct PPI number.
Don’t let this put you off, but this is mainly due to the fact that I was lucky with how my PPI was mis-sold. I took out a loan with my bank in 2002, extended it a number of times and the PPI was on there until I finished paying back the loans in December 2010.
You, if you're reading this because you googled PPI and are looking for advice, may have had PPI on several different loans, credit cards and bank accounts over the last ten years, so you may have to make a few claims. Don’t let that put you off either.
This is where the PPI Claims people will start to look attractive. Don't do it. Much like a lager fuelled visit to the disco and subsequent pull of a fat bird, you’ll regret it once the beer goggles have broken. They will ask you the same questions the bank will and take 25% for the privilege. I am certainly no expert, but I will offer the following as encouragement and advice to be taken with a small pinch of salt.
If you do have a number of potential claims then I think that to start with, you should take one of the accounts (intended claim) that you know all of the details for and apply it to the Financial Services Authority PPI Questionnaire. The link is a direct download of the word document from the FSA’s website. I’m not trying to download a virus to your PC. If you don’t trust me then google “PPI Questionnaire” and you can download it directly from the Financial Services Ombudsman yourself.
Print it out and read it.
This should give you a good idea as to what criteria the FSA and lending organisations are working to when it comes to repayment of PPI.
When I rang my bank to make my complaint, it boiled down to three questions. Other organisations may be slightly different but the FSA questionnaire should help here. The key points to take from the FSA PPI Questionnaire are these:
• How was this insurance sold to you?
• Did the lender advise or recommend that you take out this
• Why are you unhappy about the selling of your PPI?
• If you were employed when you took out the insurance, would you
receive money for being off sick or being made redundant?
• Were you healthy at the time you took out the insurance?
I think I repeated the phrase “I didn’t need it and my bank, as my financial advisor, should have advised me that I didn’t need the policy as I was in good employment, good health and any events that would have stopped me working would have been covered by my employers making the PPI policy redundant.” at least twice.
The other point I made was that if I was to be sacked from my job, the Payment Protection Insurance would have been as much use as tits on a boar. So to speak. Insurance policies rarely pay out if you’re fired.
Take each of those bullet points and write down your answer. Re-read and revise them as many times as you like until you feel happy with the answers. I did. Oh, don’t swear either. The people on the other end of the line were actually quite helpful.
Once you’re happy with your intended complaint, ring them and go through the process with them, just be sure to log dates, times, phone numbers (I know) and names of the people you speak to. You’ll be able to find the number you need to call via the lender’s website.
With any luck, it should just take one phone call if you have all of the details. The details they will need are the account number that the payments were made from and when they were made. They will try to get you to roll out the PPI Policy Number and a whole load of other junk but all I did was supply them with the final payment date, the amount and the account number. The onus is on them to conduct the investigation once these details are supplied.
Now, go away and do that before you read on. Go on. I’ve got plenty of time.
Well done. Feel good? Are you shaking a little? I know I was! That’s your first claim made. Seeing as you will be doing a number of these, it wouldn’t hurt to set up a spread sheet to keep track of the claims, reference numbers, accounts they relate to and dates/times of phone calls, letters and who you spoke to. Each worksheet could relate to an individual claim.
So then mate, as for the more difficult ones, don’t worry, you’re documenting them and you’re not the only person in that situation.
I was quite lucky because mine was a series of loans, basically one loan that was extended 5 times, and I knew when the last payment was made. However, this should not present a problem for you either, even the Barclaycard/Egg scenario.
Barclaycard bought Egg and so they therefore bought their liabilities. Martin Lewis’ blog, the guy behind MoneySavingExpert.com, has some good suggestions but this post that also pleads with you not to use the claims companies, notes in the “The top 10 questions for PPI reclaiming” section:
My lender has gone bust/been taken over
If it’s bust, reclaim from the Financial Services Compensation Scheme, which covers the liabilities of defunct insurers. If taken over, go to the new provider, so for the Egg card, you reclaim from its current owner, Barclaycard.
As for the other loans that you’re not sure on, we have the Data Protection Act and the Freedom of Information Act to help us here. If anyone has any information on you, they have to hand it over to you. It may cost a couple of quid, literally £2 in the case of Equifax, but that small outlay will ensure that you have all the information you need to pursue your claim, even on deactivated accounts.
If you need it, this link provides info on how to submit a Subject Access Request (SAR). You may find you need to submit a SAR because you no longer have your old bank/credit card/loan statements or agreements and need to find out what you paid PPI on.
It’s perverse, really. I went to the bank for a small loan and managed to remain weighed down by that millstone for almost a decade. Thousands of pounds wasted because I couldn’t stay in of a weekend!
What’s actually more twisted is the fact that even if there was no PPI on my loans, I would actually be in the same sort of situation I was before I made the claim! I may be a couple of quid less in the hole, but I would still be here!
There is no way on this planet that I wouldn’t have lived right up to the edge of my means. That said, it still doesn’t make it ok for the bank to milk me for even more of the cash that I hadn’t even earned yet.
If you were sold PPI in the same way that I was, then get that money back and do not give it to the PPI Claim Merchants.