Refund of PPI
If you believe you have been paying for a payment protection insurance (PPI) policy unknowingly, you may want to consider filing a PPI reclaim against the lender or credit card company that sold you the policy in order to reclaim all of the funds allocated towards PPI against your will. A lot of borrowers who are desperate for financial assistance are quick to sign a loan contract without reviewing the fine print. However, while it is the duty of the loan applicant to review the loan terms and conditions, according to the Financial Services Authority (FSA) it is also the obligation of the lender or credit card company to thoroughly explain the cost, purpose, and specific terms and conditions of a PPI policy before selling it.
What Will Need to Be Proven to Receive a Refund of PPI?
Considering that nearly 90% of PPI policyholders will be denied repayment assistance due to ineligibility, there is a good chance that you're PPI policy was mis-sold and you are paying an excessive amount for an insurance policy that provides no real protection. When your payment protection claim case is judged the outcome will be to current primarily on whether it can be proven that you are ineligible for the policy or were not informed of coverage requirements and policy costs. When you apply for a loan, credit card, or mortgage the lender, credit card company, or financial institution is responsible for ensuring that you are eligible before selling the policy; if they do not do this then the policy will be deemed as mis-sold, and you will recover all of the funds spent on PPI.
How Much Will a Refund of PPI Be Worth?
PPI policies can account for as much as 56% of the overall loan amount. For example, a £10,000 personal loan can carry a PPI policy that costs as much as £5,600, which is a substantial refund of PPI that can provide substantial repayment assistance for borrowers that are successful in claiming PPI insurance back. If you've paid your lender, bank, or broker more than 15% of the overall loan amount, then the answer to the question "Have I paid PPI fees unnecessarily?" is a probable yes. There are about 20 million PPI policies in existence in the United Kingdom at the moment; however, given the recently rampant mis-selling of PPI, and expected 7 million policies will be created within the next 12 months alone. Fortunately, several financial authorities have begun scrutinising lenders, brokers, financial institutions, and insurance companies that are involved in PPI mis-selling.
How Many Lenders Are Forced to Refund PPI Each Year?
In 2009 there were approximately 30,000 PPI claims, in 2010 there were about 50,000, and this year there are expected to be at least 70,000. The majority of cases resulted in the lender having to refund PPI payments within a time period of no longer than eight weeks. However, it is important to note that the exact amount of time it takes to receive a PPI refund will vary depending on variety of factors, and there is no way to guarantee a successful reclaim. However, you will not be obligated to pay anything unless you receive a full refund of PPI.
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