Car Loan Insurance (PPI)
Was your Car Payment Protection Insurance (PPI) policy mis-sold to you?
Car loan insurance is intended to cover the expense of your monthly car insurance payments should you be temporarily out of work as a result of accident, illness, involuntary unemployment or hospitalisation. The peril inherent in such a policy stems from a lack of clarification on just how much the PPI is really going to cost you.
One well documented example is of a Birmingham resident who sought to purchase a second-hand car and failed to realise that the cost had more than tripled from £7,000 to an outrageous £21,500 the instant that she had completed the paper work. The client had signed a credit agreement which incorporated a loan with an implausible 42.5% interest rate and car finance insurance which cost more than the vehicle itself. The underhanded details only became clear when the car was written off, leaving her thousands of pounds in debt.
The victim had visited a car dealer and picked out a second hand Rover 25 on display for £7,080. When the client asked about credit, the dealer referred her to a firm which told her that she could acquire the car but would be required to take out Guaranteed Asset Protection (GAP) insurance, vehicle loan insurance and a warranty for the vehicle.
These add-ons, combined with the 42.5% interest rate, pushed the cost of the 62-month finance package to astronomical levels, however, the most dire aspect is that the client had no concept of what she'd signed herself to. Over and above of the £7,080 sales price of the car she had agreed to pay £3,228 in car loan insurance. In this case, because the expense of the premiums was added to the loan making them subject to the 42.5% interest charge, the amount escalated to £8,957.
The client was then compelled to pay interest on the original price of the car, in addition to related charges, which pushed the total amount that she was expected to pay up to £21,540. Later the car was written off after a collision and she was able to claim through her insurance for the value of the car, but the GAP insurance did not draw near to paying off the money she still owed to the loan financer. The client now had no car, and the firm continued to demand that she pay £13,500 for the now useless payment protection and credit agreement.
We can look to recover the full cost of your car PPI policy (which is often THOUSANDS of pounds) plus interest, if we believe that you have been miss sold PPI
