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  • FIRST POST
    • DJ1418
    • By DJ1418 18th Oct 16, 2:29 PM
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    DJ1418
    Cant Reclaim PPI because of Bankrupsy
    • #1
    • 18th Oct 16, 2:29 PM
    Cant Reclaim PPI because of Bankrupsy 18th Oct 16 at 2:29 PM
    Hi All,

    I was recently contacted by a PPI claims company who told me they could investigate any claims as far back as 20 years. Having been told the banks could only go back 6 years I was a bit dubious, but agreed.

    They got back to me and told me I had a claim on PPI from 1998, while taking some details she asked me if Id ever been made Bankrupt, I confirmed that I had but it was a good few years after the PPI loan. At this point she consulted her manager and informed me that it would be pointless continuing the claim as the bank would probably take any refunds.

    Do I have a claim?

    Cheers.
Page 1
    • Moneyineptitude
    • By Moneyineptitude 18th Oct 16, 2:41 PM
    • 17,229 Posts
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    Moneyineptitude
    • #2
    • 18th Oct 16, 2:41 PM
    • #2
    • 18th Oct 16, 2:41 PM
    PPI redress is treated as a pre-bankruptcy asset and, as such, belongs to the Official Receiver for redistribution to your former creditors.

    So you can certainly complain, but you will never get anything personally.

    You can read all about here on the sticky thread from the Bankruptcy Board;
    http://forums.moneysavingexpert.com/showthread.php?t=3766585
    • DJ1418
    • By DJ1418 18th Oct 16, 3:14 PM
    • 8 Posts
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    DJ1418
    • #3
    • 18th Oct 16, 3:14 PM
    • #3
    • 18th Oct 16, 3:14 PM
    Thanks for the reply,

    Some more information on the PPI loan,
    This loan was took out on 1997 and settled in 1998, the Bankruptcy didn't occur until 6 years later.
    • dunstonh
    • By dunstonh 18th Oct 16, 4:24 PM
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    dunstonh
    • #4
    • 18th Oct 16, 4:24 PM
    • #4
    • 18th Oct 16, 4:24 PM
    This loan was took out on 1997 and settled in 1998, the Bankruptcy didn't occur until 6 years later.
    Doesnt matter how long before it was. Anything before bankruptcy is a pre-bankruptcy asset.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
    • DJ1418
    • By DJ1418 18th Oct 16, 4:30 PM
    • 8 Posts
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    DJ1418
    • #5
    • 18th Oct 16, 4:30 PM
    • #5
    • 18th Oct 16, 4:30 PM
    I don't quite understand, when does PPI become an asset?
    The ruling was only made for people to claim PPI a couple of years ago.
    • dunstonh
    • By dunstonh 18th Oct 16, 5:10 PM
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    dunstonh
    • #6
    • 18th Oct 16, 5:10 PM
    • #6
    • 18th Oct 16, 5:10 PM
    I don't quite understand, when does PPI become an asset?
    PPI redress is a refund of contributions on something that was paid prior to bankruptcy.

    If you paid PPI premiums after the bankruptcy, then the refund is yours. If you paid the PPI premiums before the bankruptcy then they belong to the OR to distribute to the creditors your failed to repay.

    The ruling was only made for people to claim PPI a couple of years ago.
    There has been no ruling specific to PPI. It uses the same complaints process that has existed since 1988. However, you are mixing up two different things. One is the ability to complain and one is the treatment of any redress.

    The bankruptcy rules apply to PPI redress in the same way they would any other money you come into because of something bought, paid for or owned prior to bankruptcy. The point of bankruptcy is to draw a line in the sand to allow you to start again. Not to financially gain from it.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
    • DJ1418
    • By DJ1418 18th Oct 16, 5:12 PM
    • 8 Posts
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    DJ1418
    • #7
    • 18th Oct 16, 5:12 PM
    • #7
    • 18th Oct 16, 5:12 PM
    Ok, say for talking sake, the PPI claim redress was in the region of 20 - 30,000 and I was declared bankrupt
    owing 15,000, where does that leave me considering I knew nothing about this potential asset.
    • dunstonh
    • By dunstonh 18th Oct 16, 5:27 PM
    • 85,082 Posts
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    dunstonh
    • #8
    • 18th Oct 16, 5:27 PM
    • #8
    • 18th Oct 16, 5:27 PM
    Rather than us put in our own words, here are the words of the insolvency service (i've bolded the key bits):


    1. Overview
    PPI is an insurance contract generally taken out when a loan or credit card is obtained. This contract is an asset, as is the right to complain if it was mis-sold.

    If you took out PPI prior to becoming bankrupt, then the PPI and any claim that it was mis-sold must be handed over to your bankruptcy trustee or official receiver.

    This is the same as other financial products which have been mis-sold including other loan and credit card protections, bank accounts, interest rate deals and loans.

    2. Why must the PPI mis-selling claim be paid to the trustee?
    The right to make a claim comes into existence when the PPI or other product was originally mis sold. It is still an asset in the bankruptcy even if you didn’t know you could claim compensation until after your bankruptcy. PPI is a separate contract to the loan or credit card it covered. Even if the loan has been repaid in full, any compensation for mis-selling is still a bankruptcy asset.


    3. Can I claim the funds for myself?
    The mis-selling claim belongs to the bankruptcy estate. Funds cannot be returned to you under any circumstances. Ill health, hardship or discharge from bankruptcy does not entitle you to the funds. If you make or continue a mis-selling claim after you become bankrupt, any funds must be paid to the trustee. You might still be liable for fees if you agree to pay someone to make the claim for you. For further information, contact the Insolvency Service PPI team.

    source: https://www.gov.uk/government/publications/bankruptcy-payment-protection-insurance-ppi-mis-selling-claims/bankruptcy-payment-protection-insurance-ppi-mis-selling-claims
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
    • magpiecottage
    • By magpiecottage 18th Oct 16, 5:28 PM
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    magpiecottage
    • #9
    • 18th Oct 16, 5:28 PM
    • #9
    • 18th Oct 16, 5:28 PM
    In theory you might be able to make such an argument - in which case the redress would first be used to pay off your creditors and you might get back anything that was left.

    However, if your redress was £20-£30,000, that suggests an enormous loan.
    • Mersey
    • By Mersey 18th Oct 16, 5:48 PM
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    Mersey
    magpiecottage is correct.


    The above just means that funds must be surrendered to the estate in order to be administered and must not be paid to the individual.


    A receiver could not keep more than was ever owed though (after fees).


    Although that would be an extremely rare position - for a PPI complainant to be owed more by a bank than he owed all creditors - as magpie states and I've not heard of any in recent times. (The position is also different in Scotland, as another poster - who received some PPI redress after bankruptcy - mentioned recently).
    Please be polite to OPs and remember this is a site for Claimants and Appellants to seek redress against their bank, ex-boss or retailer. If they wanted morality or the view of the IoD or Bank they'd ask them.
    • Moneyineptitude
    • By Moneyineptitude 18th Oct 16, 6:00 PM
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    Moneyineptitude
    that would be an extremely rare position - for a PPI complainant to be owed more by a bank than he owed all creditors
    Originally posted by Mersey
    Well, the OP did say for "talking sake" (which is why I said it would be better placed for discussion elsewhere).
    • DJ1418
    • By DJ1418 18th Oct 16, 8:50 PM
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    DJ1418
    [QUOTE=magpiecottage;

    However, if your redress was £20-£30,000, that suggests an enormous loan.[/QUOTE]

    I'm not suggesting one loan, im talking about CC, Hire purchase loans, Personal loans, Mortgages, all these over 25 years will surely add up.

    I'm sure there will be people out there who have found themselves in this situation, the potential to claim back redress for PPI, only to find out that this Insurance is an asset 20 years down the line.
    • dunstonh
    • By dunstonh 18th Oct 16, 8:59 PM
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    dunstonh
    I'm not suggesting one loan, im talking about CC, Hire purchase loans, Personal loans, Mortgages, all these over 25 years will surely add up.
    That assumes you had PPI and assumes records still exist and assumes that your complaints would be upheld.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
    • DJ1418
    • By DJ1418 18th Oct 16, 9:40 PM
    • 8 Posts
    • 2 Thanks
    DJ1418
    This is what I don't get, when the banks say they only keep records for 6 years. If you produce evidence i.e an agreement number then the banks can then go ahead and investigate your claim.

    Its obvious they've still got records, their putting the onus on you producing an agreement number and hoping you've not got one.
    • Moneyineptitude
    • By Moneyineptitude 18th Oct 16, 9:51 PM
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    Moneyineptitude
    Even if your conspiracy theory is correct and there are somehow records from 25 years ago, there are no guarantees that any complaint you might make would be successful (and that's leaving aside your alleged bankruptcy)

    I'm beginning to suspect your motives for starting (and continuing) this thread, I'm afraid...
    • Nasqueron
    • By Nasqueron 19th Oct 16, 9:32 AM
    • 2,953 Posts
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    Nasqueron
    This is what I don't get, when the banks say they only keep records for 6 years. If you produce evidence i.e an agreement number then the banks can then go ahead and investigate your claim.

    Its obvious they've still got records, their putting the onus on you producing an agreement number and hoping you've not got one.
    Originally posted by DJ1418
    They may have records on some sort of microfiche or stored in a bunker like Iron Mountain but there is no obligation on them to store it in such a way they can find it based on your name, it will be done by account number only

    The Data Protection Act states (paraphrasing) that they should only hold data on you as long as necessary, if you closed your accounts over 6 years ago then deleting or putting in long term storage is perfectly fine.
    • -taff
    • By -taff 19th Oct 16, 2:09 PM
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    -taff
    You cannot recevie any moneis from any potential PPI redress from howver far back if you are bankrupt after you paid it.

    If you say the PPI was worth a hypothetical total 30,000 that suggests a massive level of borrowing, which suggests spending much more money than you have income, or available, which suggests that you werent very good with money hence the bankruptcy.

    All hypothetical, and 'you' used as a general you, not a specific you.

    Banks only have to keep records for a suggested 6 years, this time is not categorical, they may keep them for much more. Its also a bit hypocritical to assume that a bank muxt keep records if you do not.

    To see what records there are you spend £10 and send a SAR.

    Again, 'you' is general not specific.
    • magpiecottage
    • By magpiecottage 19th Oct 16, 5:35 PM
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    magpiecottage
    The Data Protection Act states (paraphrasing) that they should only hold data on you as long as necessary, if you closed your accounts over 6 years ago then deleting or putting in long term storage is perfectly fine.
    Originally posted by Nasqueron
    It also says it is only necessary to produce personal data held in a "relevant filing system". By that it means "relevant to the information provided by the person requesting it.

    If, that data is filed by account number, rather than name (as was common with microfiche) then it is not relevant to the information provided.

    Then there is the issue of the PPI. As it is insurance, the cost should be less than the potential payout. That in turn suggests the defaulted debt was more than the £30K cost -so it would go to the creditors who would still be out of pocket - just not so much.
    • Nasqueron
    • By Nasqueron 19th Oct 16, 7:33 PM
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    Nasqueron
    Yes exactly, the hypothetical 30k PPI premium would require a massive debt and so would probably involved a massive default as well
    • magpiecottage
    • By magpiecottage 20th Oct 16, 2:41 PM
    • 9,133 Posts
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    magpiecottage
    Yes exactly, the hypothetical 30k PPI premium would require a massive debt and so would probably involved a massive default as well
    Originally posted by Nasqueron
    I am not sure that we should necessarily continue entertaining the OP's questions.

    Be nice to a newbie, yes - but not to the extent of encouraging trolling.
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