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PPI Cancellation

The unfortunate thing about having been mis sold payment protection insurance is that it is not that always easy to cancel. Once you have been mis-sold it there is no recourse but to file a claim against the lender who sold it to you. If you suddenly decide to stop paying for it there could be serious consequences related to your loan and you could even be considered to be in default as a result. In order to fully understand why PPI cancellation can be difficult, you first need to know how PPI works.

Understanding PPI

The reason why PPI has caused such a controversy is because of the way in which it has sometimes been sold to consumers. Keep in mind that the high number of exclusions mean that many people may be unable to use the cover. For example, it is supposed to provide cover in the event that the consumer loses his or her job or is out as a result of injury or illness. What they don't tell you is that back problems are rarely covered and if you get sick pay from work you will be excluded from cover as well. Then, another thing you may not be aware of is the cost involved. PPI is too expensive for the small amount of benefits it provides. However, even the cost is not a valid reason to file for payment protection refunds.

The High Cost of Payment Protection Insurance

One thing to understand about payment protection insurance is that the premium is paid one time and that is when you take out the loan. The cost is anywhere from 13% to 56% of the amount you are borrowing and that is a lot to be adding to your loan. Now then, here is where the real problem arises and why you cannot pursue PPI cancellation without going into default. You are making instalments each and every month on both the loan and the PPI cover. To even consider PPI cancellation is absurd because you probably have no way of knowing which portion of that payment is going toward the loan and which portion is going to PPI! In other words, trying to try PPI cancellation would also cancel the loan, which is not possible and would put you into default. If you believe your policy was mis-sold you can payment protection insurance claims as part of your claim your lender will normally cancel your cover and restructure your loan accordingly. Alternatively, you can write separately to your lender requesting they cancel your cover. Remember, not to cancel or lower your loan repayments until you have received confirmation from your lender that the cancellation has been processed and it is safe to do so.

If you would like more information on how to fill PPI claims or how to go about asking for PPI cancellation, talk to a member of the claims team on 0207 471 2000. Help is really only a phone call away.


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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 16, Elysium Gate, 126 New Kings Road, London, SW6 4LZ 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.

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* 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.

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