FinanceClaims.ie

Payment Protection Insurance Mis-Selling

2010-09-01T16:43:00.006+01:00

Payment Protection Insurance or PPI as it is more commonly known is an Insurance policy sold alongside forms of credit such as Loans, Mortgages and Credit Cards. The purpose of PPI is to protect consumer repayments should they become unable to work for certain reasons such as death, accident, illness or redundancy. In theory these policies sound great but the reality is that they are not always as good as they claim to be. Payment Protection Insurance has many flaws which include its cost, its low payout rates and the fact that it is often sold to consumers who do not need it, who did not request it and who will not benefit from it.

PPI is an extremely expensive Insurance policy. On a €10,000 loan a consumer can pay as much as €2000 extra just for PPI and on a credit card it can amount to as much as 8.5% of a monthly balance. On a mortgage the figures as you can expect soar quite considerably. On a mortgage repayment you can expect to pay €4.75 a month for every €100 owed on your mortgage. On a €300,000 mortgage over 30 years you will end up paying over €20,000 for this insurance policy.
Payment Protection Insurance policies have a number of exclusions in the terms and conditions which can sometimes prevent a payout. If you have this insurance policy you may not be able to claim if:

• You are under 18 or over 65
• Work less than 16 hours a week
• Are self-employed or unemployed
• Have existing medical conditions
• You are on contract or temporary work

Outside of the above exclusions banks and lenders have come under increasing fire for the way in which they have aggressively sold PPI without following correct sales procedures. Lenders are governed by the Consumer Protection Code which was created to protect consumers’ rights. One of the main conditions of the Consumer Protection Code is that PPI is sold as an optional cover and to consumers who are eligible for it. The problem however is that PPI provides an annual multi million euro revenue stream for the banking industry so compliance is not always on the forefront of their agenda.

Payment Protection Insurance has been mis-sold to consumers in Ireland who will never benefit from it, who did not ask for it and in some cases who did not even know they had it.

If you can answer yes to any of the following you may be a victim of PPI mis-selling:

• You were not in work or self-employed at the time of sale
• You were working 16 hours a week or less when you were sold PPI
• You were sold PPI when you had just started a new job
• You were sold PPI when you were on contract work
• You were was told that you had to take out PPI at the same time as the loan
• You were not asked if you had any other insurance which would cover the credit
• You were made to believe that PPI was compulsory
• You were led to believe that you would receive a better interest rate if you took PPI
• You were told that your chances of securing credit were far greater if you took PPI
• Details of your medical history were not asked
• Details of the relevant exclusions in the policy were not explained to you
• You felt pressured into buying the PPI
• You were sold PPI that promised cover on certain clauses which it didn’t
• You paid upfront for the PPI and it was not explained to you that you could pay for it monthly

If you have Payment Protection Insurance it is advisable to review the circumstances relating to the sale. You may be entitled to thousands in compensation without even knowing it. Would you pay for car insurance if you did not have a car?

Mortgage Rates Set To Increase

2010-07-26T21:47:00.006+01:00

Permanent TSB have decided to increase interest rates by another 0.5% which will force struggling householders to pay an average of €85 extra per month with effect from the 3rd of August 2010. Permanent TSB have revealed that from this date homeowners on their variable rate will have to endure a 0.5% increase. This could mean an additional €100 a month for any householders currently paying a €300,000 mortgage. This increase is set to affect up to 80,000 consumers nationally however other main lenders such as AIB & Bank of Ireland are also set to follow suit with similar increases so the number of consumers due to be affected by such increases is set to be much higher. These increases have dealt consumers a body blow with many already struggling to keep up with repayments.

Labour’s spokesman on housing Ciaran Lynch has hit out at the increases and has voiced his concerns quite clearly. He said: “We already know that tens of thousands of homeowners are under immense pressure wit their mortgages, with many of them falling into arrears, and an increase in interest rates, can only exacerbate this problem. “ At a time when the underlying ECB rate has remained static for 14 consecutive months, such increases are completely unjustifiable. “What we are now seeing is a situation where banks, hell bent on improving their own revenue streams, are gouging ordinary families”. Mr Lynchs’ comments are justified as there is no other reason for increasing interest rates on mortgages when consumers are already struggling with repayments. It is inevitable that more homeowners will now fall into arrears with the inevitable increases.
This seems to be another blatant example of how the banks treat the consumers of Ireland. Not only is it the taxpayers who bail out the banks but it is then these taxpayers who suffer as a result of it. There seems to be no winning with these profit hungry lenders. Fine Gael Cork TD Deputy Bernard Allen summed it up quite perfectly when he said “the banks were bailed out by the taxpayers and they are repaying us by putting this pressure on people. This extra charge will push people over the edge.”

The banks within Ireland clearly have no regard for the struggling homeowners. The alarming thing is that many of the mortgages set to increase might have been mis-sold in the first place. It is advisable to check the terms and conditions of your Mortgage agreement as you may find that you have grounds to make a claim for mis-selling. Consumers need to be fully aware of their financial rights which are protected by law as it is highly unlikely that a lender will approach you and make you aware of mistakes it has made or clauses it has failed to include in your contract when you secured your mortgage. To find out more about mortgage mis-selling please visit our website.

Recent news articles surrounding the banking crisis

2010-07-14T16:42:00.006+01:00

It has been an interesting week in relation to current affairs surrounding the banking crisis within Ireland. The two main stories making headlines this week have been surrounding the former chairman of Anglo Irish Bank Sean Fitzpatrick and Cork business man john Fleming.

Sean Fitzpatrick has been declared bankrupt by the High Court after a proposal he made to repay a debt he has with state owned Anglo Irish Bank to the tune of €110m was rejected. Representatives for Mr Fitzpatrick during a brief meeting on the 12th of July told the court that he was "bowing to the inevitable" after he failed to get the support of Anglo Irish Bank in relation to a proposal he made with his creditors. Mr Fitzptarick's assets and debts are now under the control of the official assignee, a court appointed representative under the bankruptcy legislation.
Cork businessman John Fleming is opposing AIB's attempts to reclaim €26 million worth of loan guarantees which were issued to him so that he could buy a majority shareholding in a US energy company. Mr Fleming is defending his claim on multiple grounds including that he borrowed as a consumer and therefore is entitled to the protections offered to consumers under the Consumer Credit Act.

Mr Fleming is claiming that there were irregularities in the way in which the guarantee was executed. He claims to have had agreements in place with the bank so that certain assets of his including his home would be protected.

This will certainly be a case to follow and it will be interesting to see what irregularities show up during this trial.

Mis-Selling of Mortgages

2010-06-23T21:11:00.008+01:00

During the boom of the Celtic Tiger property purchases in Ireland soared to an all time high. Investors, first time buyers and those looking for reliable pension funds all dabbled in the housing market. The property market had a proven track record over the last decade or so and it was common knowledge to think that putting your money into "bricks and mortar" was a no brainer that couldn't lose. You can see the logic in this style of thinking as house prices seemed like they would never stop rising and it was not uncommon to hear of investors making returns of between €50,000 to €200,000 in as little as 12 months on single property purchases. Mortgages were easy to come by and in some cases you could get 100% mortgages with no down payment. It really seemed to be a win win for everybody involved until the Stock Market Crash 2008.

As a result of this crash property prices plummeted and those that had recently entered this almost magical world of property investing soon found themselves in negative equity, mortgaged up to the hilt and tied to property that you could not sell for love nor money. This was when a lot of anxious and worried consumers started to look closely at the mortgage contracts they had entered into and that is when signs of mis-selling became apparent. The mortgages that some lenders were offering were not as great as we all thought.
The problem with Mortgages was that during the boom they were sold at an incredibly fast rate and often without any proper compliance and screening. Banks and lending institutions became like conveyer like machines churning in applications and spitting out credit. Profits soared and all involved in the lending industry seemed completely content on the pigs back. They were more than happy approving Mortgages for anybody with a decent salary and for those that did not meet the income threshold they handed out sub prime mortgages. That's right if you could not afford a regular mortgage they gave you a sub prime mortgage with higher interest rates!! That is a system which was inevitably doomed from the beginning. Profit came before practicality. Thought was not given to what could happen if prices fell and jobs were lost. This soon however became a harsh reality and that is when the frightening levels of mis-selling became blatantly apparent within the Irish Mortgage Market

Mortgages should be issued after a number of key areas are visited. They are Suitability, Affordability, Loan to Value, Fact Finds & the Clients needs. Only when each of these areas is investigated can a Mortgage be administered correctly. If they have not been followed you could have grounds to make a compensation claim for mis-selling.

Financial Mis-Selling Specialists

2010-06-16T19:15:00.005+01:00

Hello readers of Blogger,

Considering this is our first blog post on Blogger we will first introduce ourselves and what we do. We are Finance Claims. A dedicated claims management company specialising in Financial Mis-selling within the Irish Financial Services Sector. We deal with mis-selling issues on a wide variety of financial products including Mortgages, Credit Cards, Credit Agreements, Investments, Pensions, Life Assurance and Payment Protection Insurance. We provide consumers who have been mis-sold or misadvised a channel through which they can look to claim compensation from their lender.

If you believe you are a victim of mis-selling or unbalanced terms and conditions you may be entitled to financial compensation. We offer our customers a 100% free No Obligation review by means of our mis-selling test which you can find on our website. We can also offer our services for reclaiming mis-sold Payment Protection Insurance on a No Win No Fee Basis with no upfront charges ( t&c apply )
We will update our blog on a regular basis and will endeavour to keep our readers informed on all issues relating to mis-selling within Ireland and the Banking system as a whole. Please be sure to sign up to our RSS feed to ensure you dont miss any of our posts.