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Payment protection insurance
Liberal Democrat shadow chancellor Vincent Cable will back the Paymentcare campaign to boost awareness on payment protection insurance (PPI) agreements.
Cable said he would lend his support to the campaign, which is calling for
the Office of Fair Trading (OFT) to make high street protection providers label
PPI with clear warnings to consumers.
Shane Craig, managing director of Paymentcare, said he was delighted to have the
support of Cable.
Craig said: “Cable has himself campaigned tirelessly on behalf of consumers who
are constantly being ripped off by the major lenders. We want consumers to be
clear that they are under no obligation to buy the cover when taking out
personal loans –
something the banks and loan companies that push expensive
PPI agreements are
reluctant to see introduced.”
At present, providers do not have to display any such warning information to
consumers, Craig said.
He added: “We aim to highlight the need for further transparency in the PPI
market and we also fully support the Financial Services Authority’s recent
mystery shopping campaign to flush out mis-selling."
Cable also agreed it was important for borrowers to protect their ability to
repay should they lose their job.
He said: "There is a place for affordable
loan payment protection, and there
is a genuine case for tighter regulation of the way it is sold by the major
providers who have dined out on it for so long.”
Brian Pitt, managing director of Beacon Mortgages, said there was more danger of
call centres mis-selling PPI because of high client turnover.
“There is a possibility if people are sold personal loans alongside PPI, they
may be taking out a £10,000 product but only receiving £7500. But if firms
adhere to treating customers fairly and explain to customers what they are
getting then there should not be a problem,” he added
Source: Mortgage Solutions Magazine
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