Car loan - payment protection?

[LSainsbury]

Hello all,

Just about to apply for a new car loan and was wondering about payment protection?

Basically - is it worth it?

My circumstances are:

Living with partner- house mortgaged
Have health care cover with BUPA
Got some savings (a few k’s worth for emergencies!)
Started new job in April 2006 – stable and loving it!


The only thing I would need cover on is redundancy -just in case it were to ever happen again.

Looking at borrowing £10k over 4 years – the best figures I can find are:

Loan Amount £10,000
APR 5.7% Typical APR
48 monthly payments of £232.82
Total charge for credit £1,175.36
Total amount repayable £11,175.36
Amount per month with optional payment protection insurance £274.31
Total amount payable with optional payment protection insurance £13,166.88

(moneybackbank.com)

So – is it really worth an extra £1,991.52 over the 4 years to have payment protection?

Opinions please – or better deals if you can find any! Already checked the comparison sites, so there’s a challenge!

Cheers

Lee

Personally I don't think it is as on a 10k car if things go real real bad you can always sell it and get a cheaper one if need be.

So no imo

[SMHarman]

No...

[LSainsbury]

..and looking into it - you need at least 30 days of continuous unemployment before they will start paying out on the policy.

I wonder if dole money is regarded as "employment" - I bet thats a loophole they use in order not to pay out!

You will also find that you have to pay out first then claim it back from the insurance, it's a lot of hassle and really not worth it..

Gap insurance is worth it though if they still do it, that way if you total the car in the first 3 yrs they pay out the difference between your insurance payout and the purchase price.

[LSainsbury]

Originally Posted by gaffer_gump

You will also find that you have to pay out first then claim it back from the insurance, it's a lot of hassle and really not worth it..

Gap insurance is worth it though if they still do it, that way if you total the car in the first 3 yrs they pay out the difference between your insurance payout and the purchase price.

Thanks for that - from the info I read they would take up the payments, but it wouldn't surprise me!

GAP: Do you know of any companies that specifically offer GAP insurance policy only?

Just done a quick Google as I can't remember who I had mine with and came up with loads of results

I do remember that mine paid out an extra £2400 so it was well worth it for me.. errrr being totalled by a lorry on the m4 wasn't worth it lol..

[bob_a_builder]

There was a prog on the telly recently with Martin from MSE specifically about these sort of PPI insurance policys which in theory are optional (seems you had the option) most people don't know they are or aren't told they are
And they are a massive rip off / major profit center depending which side of the fence you sit
many cheaper 3rd party options

Quote from MSE

"Using these policies can save substantial cash. Take a £7,000 five-year loan with Halifax and the insurance alone adds an extra £44 a month. That’s £2,640 over the life of the loan. This is roughly average, yet a 35 year old could get full cover with a standalone PPI provider for just £3.50 a month – that’s £210 over the life of the loan; a saving of £2,430.
"

MSE - PPI info links

[LSainsbury]

Originally Posted by bob_a_builder

There was a prog on the telly recently ...

Yeah - like bloody Friday night and I missed it! Typical!

Just been looking at the slow site - some excellent advice and confirms my suspicions! Have bookmarked that site now!

Nice find - thanks!

I've just flicked a boggy at you!

[Shaun]

Basically - is it worth it?

Originally Posted by SMHarman

No...

Don't touch it with a bare pole - they never pay out because they always find a loop hole.

Stick the monthly cost of the PPI in your savings and you'll benefit from it down the line.

[LSainsbury]

Well - I've been approved and got the hard sell on the PPI...didn't take it though! :-)

[skyblueheroes]

I would say no. These things are never normally worth it if you have a stable job, nice house and some savings.

Originally Posted by lsainsbury

Hello all,

Just about to apply for a new car loan and was wondering about payment protection?

Basically - is it worth it?

My circumstances are:

Living with partner- house mortgaged
Have health care cover with BUPA
Got some savings (a few k’s worth for emergencies!)
Started new job in April 2006 – stable and loving it!


The only thing I would need cover on is redundancy -just in case it were to ever happen again.

Looking at borrowing £10k over 4 years – the best figures I can find are:

Loan Amount £10,000
APR 5.7% Typical APR
48 monthly payments of £232.82
Total charge for credit £1,175.36
Total amount repayable £11,175.36
Amount per month with optional payment protection insurance £274.31
Total amount payable with optional payment protection insurance £13,166.88

(moneybackbank.com)

So – is it really worth an extra £1,991.52 over the 4 years to have payment protection?

Opinions please – or better deals if you can find any! Already checked the comparison sites, so there’s a challenge!

Cheers

Lee

Try THESE I've used them a few times, you'll be surprised at their rates, I got cover on a £12,000 loan for £12 per month instead of the £70 per month the bank were after charging me.

[LSainsbury]

Originally Posted by Nidge

Try THESE I've used them a few times, you'll be surprised at their rates, I got cover on a £12,000 loan for £12 per month instead of the £70 per month the bank were after charging me.

Top man! That's much better. Will need to read the policy before I would buy!

[orangebird]

Originally Posted by lsainsbury

Top man! That's much better. Will need to read the policy before I would buy!

Motley Fool has a bit to say about PPI that's sold with loans....

I had PPI on a credit card when I got made redundant - they wouldn't pay out for six months...