POW! Capital One fined £175,000. BAM! Egg fined £721,000. SMACK! Alliance & Leicester fined a record £7 million.

Take a moment to CHEER the three clobberings given to these lenders by regulators -because it's flung the door open for YOU to reclaim THOUSANDS.

In my column a year ago, I urged everyone who has had loans or credit cards in the past six years to check if they'd been mis-sold Payment Protection Insurance (PPI).

Since then, scores of lenders like those above have been walloped for dire selling practices . . . and now's the perfect time to take 'em on.

Why? Because the industry is under attack. The Competition Commission has proposed banning lenders from selling this insurance alongside loans. And relentless fines put pressure on lenders to admit wrongdoing and pay recompense.

And it's now even easier to get your money back. About 400,000 PPI-reclaiming template letters have been downloaded from my website and thousands of successes reported.

Lie

And to really rev you up, the biggest PPI reclaim I've heard so far is £27,500. So join in-and start 2009 with a cash bonanza.

PPI is designed to make the loan or card repayments for you if you're ill, have an accident or lose your job. By itself, it's NOT a bad product, especially in this economic climate.

The problem? Many banks pushed policies too hard without checking suitability.

Lots of people shell out hundreds a year for PPI they don't even know they've got. Others were told it was compulsory-a LIE. The regulator has even unearthed cases where people who said NO still had it added.

Worst of all, PPI from lenders is usually hideously overpriced, sometimes up to TEN TIMES the cost elsewhere. So on a £5,000 five-year you'd typically pay £1,500 in insurance.

This makes it hugely profitable -for only a fraction is ever paid out to claimants.

So if you're a PPI payer-follow this checklist.

STEP ONE: Do you need it? If you could cover repayments anyway, try to cancel your policy. If you do want insurance, get quotes from specialists like British Insurance & Paymentcare where it's likely to be a tiny portion of big lenders' PPI costs-then see if you can cancel, ditch & switch.

STEP TWO: Check to see if your were mis-sold your PPI. Did any of the following happen?

The bank said it was compulsory.

It didn't tell you PPI was added.

You're self-employed and were sold unsuitable unemployment cover.

You had a pre-existing medical condition and weren't asked about it.

If any of these apply, take the next step, though be aware reclaiming may mean the policy will be cancelled.

STEP 3: Request your money back with one of my template letters saying you were mis-sold the policy and want ALL your money back.

I've drafted letters for every stage-just add your own details. These and further mis-selling categories are at moneysavingexpert.com/ppi

STEP FOUR: You'll almost certainly get a reply saying you are wrong. Expect this-it's the bank testing your determination. Simply write back warning that if this isn't settled, you'll go to the Ombudsman. It's after this that many get their money back.

STEP FIVE: Complain to the Ombudsman. If you're still not adequately settled, then call or go to the website financial-ombudsman.org.uk

This service is FREE and has ruled that companies should pay out more often than not.

If you lose? It just means you get no payout and all it's cost you is your time and a few stamps. One warning: If you got pre-2005 loans from an agent (like a car dealership) and not a bank, the Ombudsman might not have have rights to rule on it.

I object to claims-handling firms as they snaffle a huge chunk of your win. But in this situation, it can be worthwhile as you may have to go to court.

Whatever you do: Reclaim!

Santa Clause at Uni

Q WHO'S right? A friend said the student loan interest rate dropped to three per cent this month. I thought it only changed once a year in September?

DIANA RICHARDS, email

A YOU both are. The rate for official student loans does change annually in September, and it's based on the rate of inflation for the prior March. This year it dropped from 4.8 per cent to 3.8-yet something extraordinary happened in December.

A little-known clause in loans for students who started university in or after 1998, says that if the average base rate of 11 major banks-plus one per cent-is lower than the inflation rate, it should drop to that. For the first time EVER it has. This means post '98 loans are now three per cent while earlier loans are still at 3.8.

Q I'VE bought a dining suite and paid the deposit on my credit card to get Section 75 protection. But the salesman said my VISA debit card would have covered me. Is this right?

ROSE WATKINS, email

A Your salesman's info is a bit erroneous. Buy goods from £100 to £30,000 and Section 75 credit card LAW means your issuer is JOINTLY liable with the retailer if something goes wrong.

So if you took delivery before a store went bust but then found a fault, the card company MUST sort it. The reason you're already safe is this cover applies even if you only PARTIALLY pay on the card-say a fiver.

Your salesman was talking about Visa Debit card 'chargeback', an internal Visa system and NOT law. This means if delivery fails and you ask within 120 days, your bank can try to claw the money back from the company's bank. It's NOWHERE near as strong as section 75 and should be seen as a back-up.

GOT a question? Email notw@moneysavingexpert.com

TV Money Guru Martin Lewis is the creator of the Consumer Revenge website which is packed with info on how to get more money in your pocket. Log on now to MoneySavingExpert.com

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