When Matthew Green of Stenson Fields, Derby, took out a secured loan, he thought some element of payment protection insurance might be useful. What he didnt realise, however, was that he would end up paying many thousands of pounds for less than one year of cover.
It was only when he attempted to re-mortgage his property that the full costs of the policy, sold by Picture, became apparent and Matthew received a nasty shock.
My mortgage advisor went over my paperwork for the £47,000 loan and wanted to know why I was paying thousands of pounds for PPI, he explained. Even worse, the loan was over a 25-year period but the insurance policy only covered the first five years. We asked for a settlement figure from Picture who offered about £1,500 which meant it had cost me many thousands of pounds for just eight months cover.
My loan application was dealt with over the phone and the payment protection part just got swallowed up with all the other details. It wasnt clear that I didnt have to take the insurance out or that the loan wasnt dependent on having it. I definitely didnt realise that if I settled early, the PPI payments would still be taken for the whole term, said Matthew, 41, who works as a CNC programme operator. His mortgage advisor told him about financial experts BrunelFranklin.com Brunel Franklin pursued his case for compensation, securing a massive pay-out of thousands of pounds.
I am obviously over the moon with the compensation and the help I have received from Brunel Franklin; I couldnt have done it without them, said Matthew. I just wanted to be in a position where I could pay off Picture and draw a line under the whole experience. I am annoyed about whats happened and much more wary about financial products which seem to be sold at massive commissions to customers who dont always realise whats involved. There must be thousands of other people in a similar position to me who dont understand the seriousness of their situation or just how much the cover might cost them, he added.
Sally Bowyer, Managing director for http://www.BrunelFranklin.com, said it was scandalous that PPI policies were so often mis-sold. Firms who used unscrupulous sales tactics to sell PPI are finally having to pay for the shoddy way in which they mistreated customers. The fines levied against vendors are relatively small when you consider that up to 35 million policy may have been sold and many people dont even know theyve got then. Those who do have it didnt necessarily ask for it, or want it.
We have dealt with no end of cases where the cost has been added automatically to the loan or people have been led to believe its a compulsory requirement when it is in fact optional, she said.
In Mr Greens case the interest on the PPI was calculated over the 25 year term of the loan even though he was only insured for the first five years which is clearly unfair. We are delighted with this success and there may be millions more people who are entitled to compensation. Borrowers who do want payment protection may already be covered under some existing insurance or an employers sickness scheme and, if not, they have every right to shop around for the best product for them. People should be made well aware of these facts at the point of sale but once again financial institutions are happily overcharging customers and should be brought to book, she added. We would urge anyone who thinks their policy was mis-sold to seek specialist advice without delay.
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