How to calculate the interest on PPI claim???

[onevodka]

Sorry for being a bit dense but I've read quite a few posts now, and am still not sure how to

calculate the interest on my 2 PPI claims (from the same bank)

I've got one claim for £378 (2001) and one at £451 (2003) add them both together? plus compound

interest (the APR at the time was 14.9%- do I add this per year that the PPI was in force?) plus 8% ???? Apologies everyone but I'm struggling getting my head round the right way to do this! Any advice, greatly appreciated.

[rebel11]

Hi one

 

Have a read of Numbers (2) (3)

in my signature.

[onevodka]

Thanks Rebel! I'm still not sure if I'm working this out properly. Thought I had, and now I think not! My first PPI was in May 2001, for £461.57 over 36 months. It was cancelled (loan paid off) in February 2003 and a refund of £83.17 given. Leaving PPI of £378.40 to reclaim. The second was Feb 2003, PPI of £934.75 over 60 months. Cancelled July 2004 (loan paid off) and a refund of £483.21 given. Leaving PPI of £451.54 to reclaim. Both loans were at 14.9% APR. Am I right in thinking that the first

PPI the interest (14.9%) is only for approx 21 months, then the second PPI the interest (14.9%) is for 17 months, then add 8%

interest on to the whole lot? I'm really sorry if this doesn't make any sense!!!

[dx100uk]

http://www.financial-ombudsman.org.uk/publications/technical_notes/ppi.html

 

dx

[onevodka]

Hi - thanks DX. I've added the interest at 14.9% to both PPIs, for the length of time that they were

in force - (21 months and 19 months respectively). My question is, then do I add 8% interest to each PPI per annum from the date the loans were settled up to today's date? Or from the date the loans were taken out, or is the 8% added once only to the total ?

[dx100uk]

if know what you paid PER MONTH for the PPI

 

then just add 8% stat int from the date of each monthly payment - to the date of your claim.

 

dx

[onevodka]

Hi DX - no I don't know what the PPI was per month, it was a single premium added on to the loan(s) - presumably I take the amount of PPI and divide it by the number of months the loan was to run for... to find the monthly figure???

[havinastella]

Hi Vodka,

 

Welcome to the wonderful world of PPI reclaims

 

The easiest way to work out what is owed is to have your statements for the time the loans were paid (Or the loan details)

 

So for example, you say the first PPI was £378 on the loan, this would have been spread over x amount of months, we'll use 36 as example. £378 / 36 months gives £10.50 a month PPI premium.

 

So if you paid £10.50 on 25/1/01 and with 14.9% interest, for that month alone, they would owe you £10.50 + £38.74 Compound Interest = £49.24. Use this site http://www.egalegal.com/compoundWindow.html

 

Now you claim 8% Stat Interest on this amount from the same date, so £49.24 becomes £89.79, use this site http://www.bllaw.co.uk/services_for_businesses/insolvency_and_recovery/simple_interest_calculator.aspx

 

So as you can see, this becomes a lot of money Very quickly.

 

Lets hope I got this right.

 

Jogs

[onevodka]

OMG it does make this a much more sizeable claim...! Will the banks refund PPI as per this or do you have to actually go the court route... I'll post back if I'm still rubbish at working this out! Thanks everyone who posted some advice, this site is a lifeline. Speak later!

[dx100uk]

take the full cost of the loan. [the total of everything loan total]

 

take the full cash price of the ppi [this inc their int added]

 

workout what % the PPI is of the full amount.

 

take your PCM payment, and use that % to tell you what PCM PPI was

 

then add 8% stat from the date of EACH payment to the date of your claim.

 

dx

[onevodka]

Hi Dx - The first loan was for £3000 in May 2001. The PPi was £461.57. The APR was 14.9%. The loan was settled in Feb 2003 and a rebate of £83.17 on the PPI was given.

The second loan was for £4000 in Feb 2003. The PPI was £934.75. The APR was 14.9%. The loan was settled in July 2004 and a rebate of £483.21 on the PPI was given.

Can anyone tell me the right amount to reclaim? I don't know the interest rate of the loan, only the APR.

[dx100uk]

so's you have the agreements>?

 

post them up

 

scan the required letters/agreements/sheets

as a picture file

remove all pers info inc barcodes etc using paint

but leave all figures and dates.

goto one of the many free online pdf converter websites

convert the image to pdf format.

or ir you have PDF as an installed printer drive use that

open a new msg box here

hit go advanced below the msg box

hit manage attachments below that box

hit the add files button on the top right

hit select files, navigate to your file on your pc

hit upload files

NB:you can set where it goes in the post by hitting insert inline.

the hit reply button

dx

[MrZ]

Correct me anyone if this is wrong...

 

Your monthly payment will already account for the interest being applied to both the principal amount and PPI.

 

If you know the total amount of the loan, including PPI then you can work out the percentage. Assuming your loan was 3000.00 and ppi was 461.57 for a total loan of 3461.57, this means 13.3342% of your payments went to the PPI payment. (461.57/3461.57x100=13.3342)

 

If your payment was 118.20 over 36 months this means the total to be repaid would be £4255.20, of which £567.40 (4255.20 x 13.3342%= 567.40) was PPI.

 

If you made your full payments of 118.20 each month then you paid £15.76 (118.20x13.3342%=15.76) each month for 21 months for a total of 330.98 paid toward PPI.

 

You then add your 8% interest to 15.76 each month (15.76x8%=1.26) for 21 months totaling £26.48.

 

That gives a claim total of £357.46 for loan 1.

 

This of course assumes your monthly payment was 118.20 over the full 36 months. Obviously you paid more as you paid off the loan early. You will only know exactly what to claim when you have your statements, but thats the basic formula you will use.

 

PPI divided by loan amount = percentage of loan making up PPI

Percentage multiplied by total amount payable = total amount of PPI added to loan

Percentage multiplied by monthly payment = monthly PPI paid

Edited May 11, 2011 by MrZ

[dx100uk]

just dont forget that the 8% is charged from EACH MONTH YOU PAID

 

so's they wil each be a bit diff as dates change.

 

but thats a great calc

 

dx

[onevodka]

Morning everyone. That calculation is applying the interest at 8% for the duration of the loan only, (36 months but settled at 21 months) - havinastella was treating the interest on the payments made

up to today's date, is that right? Because that makes a huge difference, and in effect you have been deprived of the money for that amount of time?

[onevodka]

In the calculation, interest is charged at stat. 8% on each monthly PPI payment. Should this not be 14.9% as this is what the bank were charging me? Also, should the total figure (£357.46) then have stat. interest at 8% applied per annum since the loan was settled, to the present date (8 years) as this is the length of time you have been deprived of the money?

[MrZ]

just dont forget that the 8% is charged from EACH MONTH YOU PAID

 

so's they wil each be a bit diff as dates change.

 

but thats a great calc

 

dx

 

Quite right DX. You would apply the 8% from each month. The further back the month goes it will be a few pence more. In the current month only would the 8% equal the amount shown in my calc. The 8% simple is the easy bit once you get your head around how to determine what was paid in.

[MrZ]

In the calculation, interest is charged at stat. 8% on each monthly PPI payment. Should this not be 14.9% as this is what the bank were charging me? Also, should the total figure (£357.46) then have stat. interest at 8% applied per annum since the loan was settled, to the present date (8 years) as this is the length of time you have been deprived of the money?

 

When dealing with the lender and possibly the FOS if you have to pass it to them, you can expect 8% as the amount award. And yes its would be up to the date of compensation. It wouldnt stop at the time the loan was paid off.

 

14.9% is what they charged you in for the "privelage" of paying the premium over time and it is already included within the monthly payment amount. The 8% simple interest (section 69 interest) up to the current date is what they would be giving you in compensation for depriving you of your money....which is what would be awarded as standard in court.

 

In order to ask for 14.9% compounded you would need to seek damages (restitutionary interest) from the court. My understanding is this is a reasonable request if your claim goes to court. But it is highly unlikley the lender or the FOS would entertain the idea of compounded contract interest on top of the claim, and will offer the 8% simple. Court is another matter altogether. Exactly the same questions I had in the beginning as well. It was only after several long winded questions to some admins I managed to get my head around it.

 

I am looking to take my claim to court and seek the restitutionary interest as I described above. I already have an admission of mis-sale and so my argument at the momemnt is how much is due. You might be better off concentrating on getting your claim upheld in the first instance and then look to determine how much comp is required to set things right. If you cant come to an agreement you can then claim in court and leave it up to the court and not the bank/lender and their friends at the fos.

 

My thread is a bit long but the answers are there. And you can see just how confused I was until others came to my aide.

http://www.consumeractiongroup.co.uk/forum/showthread.php?304631-Welcome-Finance-PPI-and-Mr-Z&p=3403290

Edited May 11, 2011 by MrZ

[onevodka]

Thanks MrZ. Had a look at your thread - very interesting. I too have another 'battle' with Welcome Finance for a v. old PPI but that's another story..! Back to this, could someone have a quick look at this before I send off my letter. Want to make sure it's right and I've not misunderstood:roll: (wouldn't be the first time!):

1st PPI: worked out that £15.76 was the monthly PPI payment (£17.02 inc. 8% interest)

paid for 21 months = £357.46

then add on 8% interest to £357.46 PER ANNUM for the amount of time I've been deprived of the

money, i.e. 10 years

=£643.42 Total of claim for 1st PPI

 

2nd PPI: worked out that £26.77 was the monthly PPI payment (£28.91 inc 8% interest)

paid for 17 months = £491.47

+ 8% interest for 8 years 3 months

=£815.77 Total of claim for 2nd PPI

[MrZ]

Thanks MrZ. Had a look at your thread - very interesting. I too have another 'battle' with Welcome Finance for a v. old PPI but that's another story..! Back to this, could someone have a quick look at this before I send off my letter. Want to make sure it's right and I've not misunderstood:roll: (wouldn't be the first time!):

1st PPI: worked out that £15.76 was the monthly PPI payment (£17.02 inc. 8% interest)

paid for 21 months = £357.46

then add on 8% interest to £357.46 PER ANNUM for the amount of time I've been deprived of the

money, i.e. 10 years

=£643.42 Total of claim for 1st PPI

 

2nd PPI: worked out that £26.77 was the monthly PPI payment (£28.91 inc 8% interest)

paid for 17 months = £491.47

+ 8% interest for 8 years 3 months

=£815.77 Total of claim for 2nd PPI

 

Go for it

[ims21]

In my opinion you might be a little bit out on your calculation.

 

8% stat is charged from the date you made the payment. So let us say that you made a payment exactly 10 years ago for £15.76. The daily rate of 8% on that payment is 0 .0034 pounds. Assuming 365 days in a year and exactly ten years, you have 3650 days worth of interest. So 0.0034 pounds x 3650 = £12.41 interest for that one payment. You need to do this for every payment and work out the number of days elapsed and calculate as described. Then add them all up and you claim all the payments plus the interest you have just added up.

 

There's a simple interest spreadsheet somewhere here which will make it easier for you.

 

HTH

 

ims

[MrZ]

In my opinion you might be a little bit out on your calculation.

 

8% stat is charged from the date you made the payment. So let us say that you made a payment exactly 10 years ago for £15.76. The daily rate of 8% on that payment is 0 .0034 pounds. Assuming 365 days in a year and exactly ten years, you have 3650 days worth of interest. So 0.0034 pounds x 3650 = £12.41 interest for that one payment. You need to do this for every payment and work out the number of days elapsed and calculate as described. Then add them all up and you claim all the payments plus the interest you have just added up.

 

There's a simple interest spreadsheet somewhere here which will make it easier for you.

 

HTH

 

ims

 

Youre right, using the daily rate will result in a slightly higher amount. It is perfectably acceptable to use a daily rate. By all means count every penny, but I was understanding the OP to want to know how to calculate the PPI paid.

 

As far as interest, I am of the opinion that once the claim is upheld, then try to get it into court for restitionary damages which would then mean the exact penny calc for 8% simple isnt all that relevant.

 

But you are quite right saying that a daily rate will result in a bit more if one is happy with statutory interest.

[ims21]

Ah

 

I was looking at the OP interest calcs. I had assumed he had established the monthly ppi payment at £15.76 pm.

 

Personally, if it gets into court, I'd be going for ppi, restitutionary at their rate and then 8% stat on top of that And its always good to have your figures as near as you can get them in case you are challenged on them.

 

Anyways here is some info on the spreadsheets

 

http://www.consumeractiongroup.co.uk/forum/showthread.php?6964-Spreadsheet-with-interest

[MrZ]

Ah

 

I was looking at the OP interest calcs. I had assumed he had established the monthly ppi payment at £15.76 pm.

 

Personally, if it gets into court, I'd be going for ppi, restitutionary at their rate and then 8% stat on top of that And its always good to have your figures as near as you can get them in case you are challenged on them.

 

Anyways here is some info on the spreadsheets

 

http://www.consumeractiongroup.co.uk/forum/showthread.php?6964-Spreadsheet-with-interest

 

Too right...to quote some supermarket..."Every little helps"

 

And yes its good to be able to back up your figures, but they would be really silly to question that you atrent claiming enough...however these are banks were talking about. LOL

[havinastella]

I'm going to be claiming CI on all payments @ 34.9%, the same they charged me each month on my credit card.

 

A £1.71 PPI from 09/06/04 amounts to a claim of £29.65. (inc 8% Stat interest)

 

So I'm sure your calcs are way out vodka.

 

Jogs