Borrowers Urged to Avoid "Fully Insured" Loans
Despite the current credit crunch, people are still borrowing money left right and centre, meaning bank sales staff will continue to sell Payment Protection Insurance (PPI) to supposedly cover loan repayments if unforeseen circumstances prevent the borrower from doing so.
(PRWEB) February 1, 2008 -- Thanks to probing work by the Financial Services Authority, the Financial Ombudsman Service and the Competition Commission, it is now common knowledge that that millions of British borrowers are being mis-sold PPI on their loans. What is less well-known however, particularly among the borrowing public, are the different ways that insurers mis-sell PPI and other financial products.
It is important the borrowers become aware of the different ways that they could be misled into paying far more than they need to when taking out a PPI policy. One common and misleading ploy is when banks provide a quote on a loan, saying that it is "fully insured", but without explaining what that really means.
A "fully insured" loan is one where the PPI premiums are included in the total loan amount, usually at an exorbitant rate. This is actually a single premium PPI policy which is always bad for the customer because they end up paying interest on the insurance premiums as well as the loan itself.
Consumer watchdogs have been complaining about single premium PPI polices for years as they are always a rip-off for the borrower and a sweet treat for the insurer. The Financial Ombudsman recently stated that they are upholding around 4 out of 5 complaints about mis-selling of single premium PPI policies, so it is clearly still a big problem.
If you are worried that you might have been mis-sold a PPI policy, you can find out how to claim your money at Claim 2 Gain
For further information, please contact:
Amanda Goodchild or David Hanson. PR consultants at Adams Creative
Tel: 01622 687729
Fax: 01622 688357
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