Help or Advice

Fredtaylor71

Help or advice please!!

I started an IVA with Payplan in February 2011 with a total debt £26,440.47, with 60 payments of £287.99 which would equal a repayment of £17,279.40. A plan I was very happy with as I could start to see the end or years of struggling, and also a structure that I thought was clear and straightforward.

The following year our son decided to move out so my monthly payments were increased to £348.14 even though my income had gone down from not having his keep each month.

Equity in Finance was appointment to try and reclaim any miss sold PPI by Payplan on the Credit Cards/Loans that were in my IVA agreement. In August 2012 one Creditors MINT repaid my PPI, and took 100% offset which was still owing them on the credit card I had, this amount was £11,577.15. Even though they had agreed to the IVA, which I fully understand is their right to do so. They also paid £1,400 to Payplan which was added to my total payments. I informed Payplan straightaway of the offer in August 2012 and sent them the paperwork, I have been asking them ever since why the offset is not showing or being taken into account, all I keep getting is they will ask accounts. In August of this year I phoned MINT and spoke to a very helpful person that confirmed to me that they had told Payplan and Equity in Finance of the offset and also put this in writing and also confirmed my MINT account was in credit of close to £400, and they would again write and phone Payplan to explain again.

In August 2013 I was made redundant, mostly due to fact I had been signed off work due to severe depression, which lead to a very close attempt to end my life due to all the uncertainty and worry from a few different sources but Payplan being a major factor because they are still now not recognizing the offset from Mint.

I have informed them of my redundancy payout which was 11 weeks statutory pay, 11 weeks noticed paid in lieu and 3 weeks outstanding holidays. I was informed when I phoned them that I had been lucky in getting 2 windfalls while in my IVA, PPI and being made redundant and they would expected all monies over the allowed 6 months worth of net pay to be paid to them within 14 days.

I have made 31 payments to Payplan totaling £11,432.74 that combined with the offset of £11,577.15 = £23,009.89. I have been told I must pay £4,830.64 now along with my normal installments from the 6 months net pay I was allowed to retain which = £2,088.84. If I was to find work I would also have to pay anything remaining from the 6 months worth of net pay.

This will mean a total of £29,929.47 paid or offset on this IVA and so far £3,489 over the original debt, and I have been told as I was so lucky to have had these windfalls I will be now liable to pay all the cost and fees, and when asked what these would be they can’t give me a figure.

All I want is true facts and figures all the uncertainty is having a really bad effect on me, and I just don’t think what is happening is fair as it feels like a deep hole that money is being thrown into and no sight of it coming to an end, and the rules being heavily set in Payplans favor and a huge fees debt coming my way from what I see as very poor service.

Sorry for such a long post!!

Foxy-Stoat_3

Maybe an IVA was not the best route for you in this instance as an IVA is one down from going Bankrupt....if your thinking of this then you normally have no hope in paying back the debts in relation to your earnings.

If you were going to pay back over 65% at the start I would say that you weren't in enough debt to warrant going down the IVA route. This would of risen to over 80% once your son moved out which is obviously unforeseen.

Unfortunately the PPI income is an asset of the IVA and cannot be used as a full and final settlement, so as your IVA was going to achieve over 65% at the level you started at and with such a large PPI payment then your IVA will end up in credit at the end of year 5.

I guess they are trying to avoid having that conversation with you.

Once your take out the IVA you are locked into a contract which is binding for all parties, ie your payments are set subject to changes and the end of year 5 the rest of the debt is written off. IVA's don't normally achieve more than 100% of the debt unless you get a very large pay rise or you have a windfall/inheritance/lottery win etc.....as the PPI is normally an asset of the IVA this isn't considered a windfall although it would be worth checking your contract very closely.

I know that when some companies take over your IVA they make you sign their contract which states about PPI payments, a sneaky way to make sure they get more money.

You should read the contract you signed and see what is said, if anything, about PPI and if the account goes into credit and go from there.

Good luck.

Anondebtadvisor

I think the problem is that one creditor has off set the PPI so that money has not actually gone into the IVA as the creditor has retained it.

The IVA company will need to adjust the claim of that creditor so in effect the provable debts will be less than when you entered the IVA.

Fredtaylor71

Foxy-Stoat wrote: »

Maybe an IVA was not the best route for you in this instance as an IVA is one down from going Bankrupt....if your thinking of this then you normally have no hope in paying back the debts in relation to your earnings.

If you were going to pay back over 65% at the start I would say that you weren't in enough debt to warrant going down the IVA route. This would of risen to over 80% once your son moved out which is obviously unforeseen.

Unfortunately the PPI income is an asset of the IVA and cannot be used as a full and final settlement, so as your IVA was going to achieve over 65% at the level you started at and with such a large PPI payment then your IVA will end up in credit at the end of year 5.

I guess they are trying to avoid having that conversation with you.

Once your take out the IVA you are locked into a contract which is binding for all parties, ie your payments are set subject to changes and the end of year 5 the rest of the debt is written off. IVA's don't normally achieve more than 100% of the debt unless you get a very large pay rise or you have a windfall/inheritance/lottery win etc.....as the PPI is normally an asset of the IVA this isn't considered a windfall although it would be worth checking your contract very closely.

I know that when some companies take over your IVA they make you sign their contract which states about PPI payments, a sneaky way to make sure they get more money.

You should read the contract you signed and see what is said, if anything, about PPI and if the account goes into credit and go from there.

Good luck.

Thank you for your reply to this, just a bit confused are you saying even after the debt has been reached in my repayments to 100% paid the IVA will still carry on for the 5 year term? At that stage if correct I would of paid in close to £40k?

Fredtaylor71

Anondebtadvisor wrote: »

I think the problem is that one creditor has off set the PPI so that money has not actually gone into the IVA as the creditor has retained it.

The IVA company will need to adjust the claim of that creditor so in effect the provable debts will be less than when you entered the IVA.

Yes this is what I have been saying to them, but all I get is they need to talk to their accounts department but never sort it or keep me informed.

Foxy-Stoat_3

Fredtaylor71 wrote: »

Thank you for your reply to this, just a bit confused are you saying even after the debt has been reached in my repayments to 100% paid the IVA will still carry on for the 5 year term? At that stage if correct I would of paid in close to £40k?

Yes that would be correct.

Your contract was for 60 months at a set payment, subject to annual reviews.

As you are not expected to get anywhere near 100% of the debt at the time then there may not be anything in the wording, but at the time I guess you wouldn't of thought to ask. If you only contributed 50% of the debt the remaining 50% is written off.

Obviously the interest was frozen when you took out the IVA so that must have a value when you think about this.

The IP will have fees for administrating the IVA so if you paid 100% of the debt then your creditors would not see 100% of the money you paid.

Fredtaylor71

Foxy-Stoat wrote: »

Yes that would be correct.

Your contract was for 60 months at a set payment, subject to annual reviews.

As you are not expected to get anywhere near 100% of the debt at the time then there may not be anything in the wording, but at the time I guess you wouldn't of thought to ask. If you only contributed 50% of the debt the remaining 50% is written off.

Obviously the interest was frozen when you took out the IVA so that must have a value when you think about this.

The IP will have fees for administrating the IVA so if you paid 100% of the debt then your creditors would not see 100% of the money you paid.

There must a cut of point I cant keep paying for another 28 months, there has to be a reasonable figure that say the debt is paid and fees. I have a good chance of starting a new job next week so Payplan will want to rest of my redundancy payment of about £10,000 so quick maths at the end of the 5 year term I could easy have paid in over £45,000 to pay off a debt of £26,440.47 and using Payplan and their suggestion of an IVA to help me in fact has made me very much worse of.

Foxy-Stoat_3

I would speak to your IP about making a full and final settlement, read your contract to see if it mentions about PPI refunds.