S.140A CCA & top-up loans

[SunnyR]

Hi there everyone!

I am in the process of helping someone with their PPI claim. Basically she took out a loan with PPI added, the lender then contacted her to ask her to take out two further top up loans which she accepted.

The PPI was only on the first loan but she was not advised that by taking out the top-up's, it would essentially kill off the PPI taken with the first loan.

I think I'm ok arguing the PPI aspect, but then I came across S.140A CCA.

With each top up loan, her APR massively increased from around 30% - 70%. I don't think she was made sufficiently aware of this increase as she was shocked when her monthly payments went up by so much.

My question is, could she potentially argue there was an unfair relationship under S.140A? I understand the remedies are in S.140B. Is there any point pursuing this argument when she has already settled the loan?

Thanks in advance for any help and guidance you can give!!

[di30]

Re: S.140A CCA & top-up loans

Hi and welcome to LB.

I'm sure someone will be along at some point with some advice, but if you need any help on the PPI reclaim let us know that too.

You will find interesting information on the link below.
http://www.legalbeagles.info/forums/...ad.php?t=10645

http://www.legalbeagles.info/forums/...ad.php?t=22339

Good luck.

[SunnyR]

Re: S.140A CCA & top-up loans

Thank you.

In relation to the PPI, we are trying to argue that it was mis-sold due to the fact that my friend was made to feel like she had to take out the loan and would not be approved without it.

However, the lender has provided copies of questions etc that my friend apparently answered re: the suitability of the insurance. It appears that some sort of PPI was suitable in the circumstances, but she was not told she could go elsewhere. She also was not given time to read through the bumph before signing etc.

More of the issue though is that by taking out these top up loans, my friend was not advised that by doing so she would be essentially paying off her first loan, and thus killing off the PPI with it. My friend was under the impression that she had insurance throughout the course of the two top up loans but this was not the case. She was not advised on this at all, so if she had made a claim she would have been shocked to see that she wasn't covered!

Any help/guidance would be great!

[leclerc]

Re: S.140A CCA & top-up loans

Thank you.

In relation to the PPI, we are trying to argue that it was mis-sold due to the fact that my friend was made to feel like she had to take out the loan and would not be approved without it.

However, the lender has provided copies of questions etc that my friend apparently answered re: the suitability of the insurance. It appears that some sort of PPI was suitable in the circumstances, but she was not told she could go elsewhere. She also was not given time to read through the bumph before signing etc.

More of the issue though is that by taking out these top up loans, my friend was not advised that by doing so she would be essentially paying off her first loan, and thus killing off the PPI with it. My friend was under the impression that she had insurance throughout the course of the two top up loans but this was not the case. She was not advised on this at all, so if she had made a claim she would have been shocked to see that she wasn't covered!

Any help/guidance would be great!

Did she not read the paperwork post sale of the second loan? You appear to argue two points; 1) Misselling of PPI and then 2) not miselling PPI which is a slightly strange perspective to have imho. You would refer to the paperwork in all events even post sale if you had concerns at the time or thought that you would need to claim on the loan insurance.


EDIT: An additional question is what were the additional "top up" funds used for?

[Caspar]

Re: S.140A CCA & top-up loans

Was there not paperwork with the top up loans? If so, which I imagine to be the case for a further loan, does it not mention the new monthly payments? I would have thought it had to do this - presumably top up loans are governed by the same regulations as normal loans so come under CCA 1974? Assuming this to be the case (someone will soon correct me if I'm wrong) then a monthly repayment is part of the PT's.

If she signed the top up loan with all PT's in place, then I think an unfair relationship may be hard to argue.

[The Debt Star]

Re: S.140A CCA & top-up loans

Hi there everyone!

I am in the process of helping someone with their PPI claim. Basically she took out a loan with PPI added, the lender then contacted her to ask her to take out two further top up loans which she accepted.

The PPI was only on the first loan but she was not advised that by taking out the top-up's, it would essentially kill off the PPI taken with the first loan.

I think I'm ok arguing the PPI aspect, but then I came across S.140A CCA.

With each top up loan, her APR massively increased from around 30% - 70%. I don't think she was made sufficiently aware of this increase as she was shocked when her monthly payments went up by so much.

My question is, could she potentially argue there was an unfair relationship under S.140A? I understand the remedies are in S.140B. Is there any point pursuing this argument when she has already settled the loan?

Thanks in advance for any help and guidance you can give!!

Read my thread http://www.legalbeagles.info/forums/...ad.php?t=24152

The circumstances are almost identical.

I have recently had a full FOS adjudication in my favour.

[Caspar]

Re: S.140A CCA & top-up loans

Looks like I am wrong then. Thanks DS!:beagle:

[SunnyR]

Re: S.140A CCA & top-up loans

Thank you all for your responses.

Yes, I understand it's a bit of an odd situation. We're essentially trying to reclaim mis-sold PPI, however at the same time telling them that the two top-up loans were unfair due to her not being advised that the PPI would be killed off if she took them out.

She did receive new credit agreements for the top up loans, but I don't think she understood the significance of the higher APR's, and how this would effect her monthly repayments. I essentially think she was taken advantage of in a way.

It is a bit of a muddle! Will have a read through DS' post.


Thanks again.