Belmont Thornton Logo
Claim Back Loan Insurance

Loan Protection Payments

Lenders have been readily pushing loan protection on new loans because of the cover they will tell you it provides and they will gloss over important details whilst leading you to believe that your loan could be dependent upon purchasing cover. In fact, they leave off most of the important information when coercing you to purchase the cover among which is the high cost of loan protection payments. Of course they wouldn't want you to understand just how much this policy was going to cost you for fear that you would refuse to purchase it thereby reducing their profit to almost naught. If payment protection insurance, PPI, has been misrepresented or mis sold, UK consumers are entitled to file PPI claims for refunds of what that cover cost them.

How Much Are Loan Protection Payments?

The actual cost of payment protection insurance is quite variable as in some cases it costs around 13% of the amount being borrowed whilst other times it can cost as much as 56 to 60% the loan value. There doesn't appear to be much logic to the formula lenders use to assign cost except perhaps the borrower's credit score along with the type of loan being financed. The other factor that affects a loan protection payment is whether it is a onetime premium in question or variable monthly premiums as would be attached to revolving lines of credit (credit cards). To appreciate just how high these premiums are take a look at a mortgage loan for £150k with loan protection assessed at 25% of the loan value. The person borrowing £150k would actually be borrowing £187,500 because of the 25% added to the policy as a onetime premium and the loan protection payments would significantly affect the monthly repayments. This wide disparity between what the borrower thought they were paying and the amount they ended up paying was the reason for a significant number of PPI reclaim complaints.

Can I Stop Making Loan Protection Payments?

It isn't fair that lenders can add something as costly as payment protection to a loan without our knowledge or consent but we can't simply refuse to make loan protection payments. The unfortunate aspect is that those payments are tacked on to the monthly loan repayments and there is no way to separate them. The only way to stop making loan protection payments is to file a mis sold PPI claim with the lender. This would serve two purposes actually. If the lender approves your claim and owns up to the fact that his/her firm mis sold PPI then your loan would be recalculated without the cost of loan protection and you would be paying significantly lower amounts from there on out. In addition, you are entitled to a refund of loan protection payments that you made as a result of mis sold payment protection. There is one thing to be aware of however and that is the very real possibility the lender will deny your claim which would mean that it would need to be brought before the Financial Ombudsman Service for an appeals review.

The whole claims process can be extremely frustrating and time consuming which is why many people are coming to Belmont Thornton, Belmont Thornton. We can act on your behalf by filing a claim with the lender as well as being able to take your claim through appeals. Our knowledgeable claims team can answer any questions your may have and they can also help you get on the fast track to filing your claim. For complete details give us a call on 0207 471 2000.


Tell a Friend
blog comments powered by Disqus

Enquiry Form

First Name 
Last Name 
Mobile Phone
Home Phone
Address Line 1 
Town
County
Post Code 
Email 
Circumstances
Claim Back Mis-Sold PPI Button

Why Choose Us?

  • TickAbsolutely No Upfront Costs. No Win No Fee*
  • TickSpecialist Claims Team Always On Hand To Answer Your Questions
  • TickQuick, Easy And Simple Process
  • TickU.K. Based Call Center
  • TickGuaranteed To Start Your Claim In 24 Hours

Loan claim: Building societies warn of house price bubble

The Building Societies Association (BSA) is the latest to warn about the potential house price bubble that could arise f...

Bank claim: Lloyds raised concerns on Co-op finances

Lloyds Banking Group was aware that the financial position of the Co-Operative bank was unstable, said Lloyds chief exec...

Loan claim: first time buyers locked out for a decade

First time buyers will have to save up their deposit on a house for more than ten years, according to research from the ...

Bank charges: Commission tackles issue of RBS

The weak position of the Royal Bank of Scotland (RBS) is damaging to the UK economy, according to the Parliamentary Comm...

Bank charges: Report says customers and taxpayers were failed

Customers and taxpayers have been failed by the financial sector, according to the final report from the Parliamentary C...

Belmont Thornton Limited is regulated by the Claims Management Regulator in respect of regulated claims management activities; our registration is recorded on the website www.gov.uk/moj/cmr number 18273

Belmont Thornton Limited is incorporated in England and Wales, Company number 6621233, whose head office at Unit B16, Kestrel Court, Harbour Road, Portishead, Bristol, BS20 7AN and registered office at Harwood House, 43 Harwood Road, London, SW6 4QP.

Belmont Thornton Limited is registered with the Information Commissioners Office. Registration number Z1728023.

Please note that calls may be monitored for the purposes of staff training.

* Belmont Thornton operates on a "No Win No Fee" basis. This means that there are no upfront costs to pay. Our fee only becomes payable on a successful outcome of a claim. A cancellation fee is payable if you decide that having instructed Belmont Thornton to act on your behalf, and after 14 days of signing your Letter of Authority, you do not wish to continue pursuing your claim with us. The cancellation fee is the reasonable costs incurred for the work undertaken. Please see our terms of engagement.

By using our web-site, you agree that we can place the types of cookies described in our privacy policy on your device.Hide