Paying Payment Protection Insurance
Since we have been hearing so much about payment protection insurance of late, many people in the UK may not be aware of the fact that this is just another name for loan insurance. It doesn't matter what you call it however because the thing that has most people concerned is the high cost of paying payment protection insurance. As a matter of fact, payment protection insurance can cost anywhere from 13% to 56% of the amount of your loan and that amount is often added as a onetime premium to your loan when you close on it.
Adding Insult to Injury
It may be an old cliche but sometimes paying payment protection insurance on top of the high cost of a loan can feel like insult is being added to injury, especially if you didn't even know that you were buying loan insurance! Sadly, in some cases, PPI was added to customer's loans without their knowledge. Other cases customers were falsely given the impression being given the loan was contingent upon paying payment protection insurance. In these instances the PPI cover may be considered mis sold and the customer may have grounds for filing a claim for a refund.
Can You Stop Paying Payment Protection Insurance That was Mis Sold?
If you have found that you are paying payment protection insurance that you never wanted, unfortunately you can't just stop paying for it! The problem with trying to do that is that you may default on your loan. Look at it this way. The premium for the entire loan protection insurance cover is often added to the total amount you are borrowing. After that amount is added payments are amortised over a certain number of months and you will, in effect, be paying payment protection insurance right along with your loan payments for the duration. There can be two inherent problems with this as we see it. First of all you may be paying interest on money that you didn't ask to borrow. Secondly, if at some point you realise that you were mis sold PPI you can't just stop paying in it.
What you can do about paying mis-sold payment protection insurance is to file a claim against the lender. If you do file a claim, it is important to remember you would need to continue making loan payments in the duration. To start your claim for mis-selling today complete our quick claim form. Any questions? Call our claims team on 0207 471 2000
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