Payment Protection Insurance ( P.P.I ) reclaim question

If you have been missold PPI on an existing loan and are successful in your reclaim from the lender, can you request by law that you receive a refund by cheque/payment into bank and not have the amount deducted off your loan..?

If they deduct it off your loan surely they are altering your terms and conditions without your consent...?

Any compensation should be paid to you and if you wish to pay it off your loan then ok but you should be given the choice... !

Any one know the legal arguments for this please..

Thank you..