Loan account/agreement numbers not always needed to start your claim!
Before you make a claim for mis-sold PPI, you’ll probably want to know how much you’re owed. Using a PPI calculator to get a good idea of your refund amount is thankfully nowhere near as complicated as doing quantum calculations. More importantly, it will allow you to know if your bank has made a mistake with their calculations when it comes to refunding your money.
One important thing to keep in mind, though, is that the figure you come up with is unlikely to be 100% accurate. That’s whether you get it by using an online PPI calculator or by doing the calculations yourself. There are things you can do to ensure it’s as accurate as possible, and this PPI calculator guide will take you through those steps.
Once you’re happy you have found every policy that has PPI attached and you believe it was mis-sold, you’re ready to calculate what you are likely to be owed by your bank.
Remember to follow the same process for each policy!
Ideally, you’ll want to know if your policy is/was a single premium policy or a monthly premium policy, and also if it is/was for a loan or a credit card. If you no longer have the paperwork, you can submit a Subject Access Request (SAR) to your lender and they will provide you copies.
Even without that information, it’s still possible to make a fairly accurate assessment as to the value of your PPI claim. There are three things you need to know in order to do the calculations:
For ease, we’ll do a dummy PPI calculation with the following round figures:
While the actual PPI amount can vary greatly, depending on the type of policy and other factors, we’ll assume a round figure of 25% of the loan amount, which in this case will be £2,500.
First, The Loan Portion
£10,000 x 7.9% = £790, which is the APR for 1 year / 12 months
£1,580 x 5 = £3,950, which is the total APR for 5 years / 60 months
Second, The PPI Portion
£2,500 x 7.9 = £197.50, which is the APR for 1 year / 12 months
£197.50 x 5 = £987.50 which is the total APR for 5 years / 60 months
So using a PPI calculator we can see that the 7.9% APR on the £2,500 PPI policy amounts to £987.50 over the five years.
Third, The PPI Compensation Portion
Now you’ve done your PPI calculation for one of your policies, you’ll also need to add a further 8% to the interest portion, as that is the amount of compensation banks have been told they must pay, which is applied per year. So in this case, that would look like this:
£987.50 x 8% =£79
This amounts to a total repayment figure of £3,566.50, which is the amount you should be able to reclaim.
£2,500 (PPI amount) +
£987.50 (7.9% interest x 5 years) +
£79 (£987.50 x 8% compensation)
Remember that this is for one policy only. So if, for example, you have PPI on your mortgage, your car loan, your credit cards and any other finance agreements and they were all mis-sold, you are entitled to claim for every one of them.
Many people get a bit lost when it comes to numbers and calculations. If you’re one of those people — or sitting down to run your PPI calculations will take more time than you have — help is available.
We can help you with your PPI calculations and with your PPI claims related questions. You can either call for free on 0800 031 6078 or you can pop your details into the short form above and we’ll call you.
Speaking with us does not obligate you to pursue your PPI claim through is if you choose not to.
You may have seen in the news that not only did banks and lenders mis-sell payment protection insurance on a vast scale, they have also been mis-selling packaged bank accounts (PBAs). PBAs are bank accounts that incur a monthly fee in exchange for additional perks over a regular bank account.
Just as with PPI, packaged bank accounts have now been found to have been routinely mis-sold. As a result, thousands of people are now claiming back their money.
Read this article on packaged bank accounts to learn more.
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