What do CMC’s charge?

 

If you want to reclaim your premiums for mis-sold PPI on your loan, credit card or any other form of borrowing you can do it yourself and ultimately take the matter onto the Financial Ombudsman Service free of charge.

 

But if you don’t have the time, the inclination or just don’t want to deal with your bank/credit card or loan company you can choose to use a Claims Management Company (CMC).  When choosing a CMC it is essential you choose a reputable company and that you are fully aware of what they will charge.  Most CMC’s will charge 25%, plus VAT of any amounts refunded to you but some will quote much lower figures.  So the company quoting the lowest figure must be the best company to choose then?  Not always.

 

When you make a successful claim for the refund of the PPI you have been mis-sold your bank will refund you the premiums you have paid to date but, if you are still paying for the loan your bank will also reduce the future loan repayments so you are no longer paying for the PPI.   Most CMC’s will not only charge you on the amount you receive as a cash payment, but they will also charge you on the amount you receive in ‘future benefits – the amount used to reduce your loan.

 

This can have a dramatic affect on the amount you pay in fees for using a CMC’s.  Examples of how this can affect the fees you pay:

 

Original loan amount: £20,000

PPI amount added to loan: £5,000

Original monthly repayment amount: £250

 

Your refund offer:

Refund of premiums paid to date (this will be paid in cash): £1,000

Loan reduced by £4,000 (to remove the future PPI payments on the loan)

New monthly repayment amount: £200 

 

COMPANY A – Quoting fees of 15%, plus VAT

The fees you would pay based on the above example.

Fee based on cash amount of £1,000 = £180 

Fee based on loan reduction of £4,000 = £720

Total fee to be paid = £900

 

COMPANY B – Quoting fees of 20% plus VAT 

The fees you would pay based on the above example.

Fee based on cash amount of £1,000 = £240

Fee based on loan reduction of £4,000 = £960

Total fee to be paid = £1,200

 

COMPANY C – Quoting fees of 25% plus VAT 

The fees you would pay based on the above example.

Fee based on cash amount of £1,000 = £300

Fee based on loan reduction of £4,000 = £1,200

Total fee to be paid = £1,500

 

Claim 2 Gain fees GUARANTEEING to only charge 25%, plus VAT on the CASH you receive

The fees you would pay based on the above example.

Fee based on cash amount of £1,000 = £300

Fee based on loan reduction of £2,000 = £0

Total fee to be paid = £300 

 

A you can see from this example not all Claims Companies are the same and not all Claims Companies offer the same good value for money.  In many cases even when a company is quoting a lower fee you can end up paying more than you would with Claim 2 Gain and under certain circumstances could end up paying more in fees than you receive in cash!  When choosing a Claims Company make sure you know how much you are being charged and ensure you fully understand how their fees are charged.  You have been ripped off once by your bank, don’t get ripped off by the people who are supposed to be helping you.

 

Choose carefully, choose wisely and choose Claim 2 Gain.

 

 

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