New egg loan and payment protection

I have just been accepted for a 60 month loan of 11500 to put towards a new car. Despite being assured that payment protection was optional I have been sent a form to sign saying that monthly payments are 269. It also says that the payment for the actual loan is 231 of this and the apr is 7.9%. So it looks like the insurance is costing about 40 which sounds like a lot considering it has a 180 day excess on it. Anyway there doesn't seem to be anything on the form to specify you don't want it but the terms say you have

30 days to cancel it and all premiums will be refunded. Should I go with it and then cancel it in a week or so or ring them to tell them and risk them withdrawing the loan offer?
Reply to
Jacob Rosse
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They've got that right, at least. £231pm for £11500 over 60 months is indeed consistent with a 7.9% APR.

Do you want the insurance or not? If yes, but you want it cheaper, there is nothing for it but to renegotiate.

If not, either send the form back unsigned with a covering letter making clear that you don't want it and could they please send you a revised form showing the total payment as £231, or sign the existing form after crossing out the £269 and changing it to £231 and also signing or at least initialling the change.

Whatever you do, don't ring them, but do everything in writing. Keep a photocopy.

Reply to
Ronald Raygun

Definitely renegotiate. I have an egg loan for more than this amount without the insurance so don't worry about them pulling the offer - they need you!

Reply to
santa.pod

"Jacob Rosse" wrote in news:976b15e1fb6f8bb8bc3709fb3d5f4c73@news.1usenet.com:

Whatever you do, read the small print.

My experience of Egg's payment protection insurance is that it will cover the outstanding balance as at the date of claim (e.g. as at the date of redundancy). If then the policy benefits are paid out in monthly instalments you will still continue to be charged hefty interest month by month on a remaining balance (i.e. the balance as at date of redundancy less one month's worth of benefit), for which no payment protection benefit will be available. And, in addition, you will be charged monthly premiums for cover in respect of this outstanding balance, since the protection plan will still continue. So despite the fact that they may be paying you a monthly benefit, your interest and premium charges continue to mount up.

Bearing in mind that payment protection insurance is a racket, in which you are actually reimbursing the lender for a risk for which normally they are liable - and for which they are already making a handsome charge by way of the steep interest rate - I would say tell them to forget it.

A good place to start is:

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Reply to
Robin T Cox

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