IVA Help

dundud01

Hi i really hoping someone can give me advice. My girlfirend is in a iva, been in it 4 years and 2 years left, made every payment on time.

She has received two payments from ppi for about £5k but her payments have not changed or terms been changed.

I would have though this extra money would of made a difference as they make the arrangement at the start of the 6 years and this is extra money that would not of been accounted for.

Please help as we are really struggling financial

Foxy-Stoat_3

Seen so many threads about this sort of thing and the general opinion is that the PPI refund is an asset of the IVA and doesn't get taken into account in your payments, unless your IP cuts you a cheque.

Point is you owe X at the start, you pay back at least 25% of X and after the end of the term you owe nothing. So if you pay back 25-35-55 or 85% then it makes no difference.

You shouldn't be really struggling on an IVA as your monthly expenses should be taking into account and your normally left with nothing, or pretty much nothing.

In hindsight the PPI should be claimed before the IVA is taken out, that way its all yours.

Anondebtadvisor

Any PPI reclaimed is an asset of the arrangement and in addition to any monthly contributions being made. Any PPI reclaimed will have no effect on the payments or length of the IVA it will increase the return to creditors.

dundud01

so would have been best to claim after the iva then, thank you for the advice, gutted not the response we wanted but thats life

Foxy-Stoat_3

dundud01 wrote: »

so would have been best to claim after the iva then, thank you for the advice, gutted not the response we wanted but thats life

Nope as the IP will insist on claiming the PPI just before the completion date and as part of THEIR contract they would keep it as its considered an asset of the IVA.

PPI should be claimed before the IVA....maybe this information should be a sticky as I am sure no IP will advise doing this before a new IVA is taken out.

Depth_Charge

Foxy-Stoat wrote: »

Nope as the IP will insist on claiming the PPI just before the completion date and as part of THEIR contract they would keep it as its considered an asset of the IVA.

PPI should be claimed before the IVA....maybe this information should be a sticky as I am sure no IP will advise doing this before a new IVA is taken out.

Hi

You make some very good points and I was wondering....

How many IVA companies clearly advise on PPI claims before someone enters an IVA?

How many IVA companies have clear and open information on their websites about PPI claims pre IVA?

They may well have, I don't know, evidence might well be there?

If you don't mind me asking, why do you say you are sure no IP will advise doing this before a new IVA is taken out?

I am still trying to get my head round how taking huge amounts of PPI monies out of the arrangement can be in the best interests of the IVAer or the creditors.

If anyone representing the IVA companies (from the other forum perhaps) fancies a dabble on this one, well here is your chance (another opportunity to balance the debate on here, so don't miss it guys:)

You never know, we all might learn something and it is a very serious subject joking aside.

My take with a touch of inter agency humour

Foxy-Stoat_3

Point is, if you owe say £50,000 and lets say you have £10,000 within that as PPI refunds, whether you knew it at the time or not, before you start your IVA. At this point you are one step away from going BR so you will be borrowing money just to life and get by, letters and phone calls and stress levels will max'd out.

As long as you can pay back at least 25% of the £50,000 your on a winner as you WILL be able to afford to buy food and rent and live without the worry of paying your debts and within 5 years you will be debt free. So IVA will be the best option as £37,500 will (plus fees) will be wiped off your debt....happy days!!

Say before you start your IVA you come on these boards and people tell you, claim your PPI first then do the IVA....You get your £10,000 refund...HAPPY DAYS, that can go towards your mountain of debt that you have been worrying over....but you'll still owe £40,000 that you cant afford pay back in a reasonable time and still have stress, money worries so you do an IVA as long as you can pay back at least 25% of the debt you will be fine. So £30,000 plus fees is wiped off and your debt free.

Tell me whats the difference?

This is only an issue where an IVA isn't the right choice to start with....theres a thread on here when after the IVA finished and the IP claimed the PPI refund, the individual would of paid back nearly 100% of the total debt but still will face the issues with having an IVA and rebuilding of their credit again....clearly an IVA was the wrong choice at the time.

Depth_Charge

Foxy-Stoat wrote: »

Point is, if you owe say £50,000 and lets say you have £10,000 within that as PPI refunds, whether you knew it at the time or not, before you start your IVA. At this point you are one step away from going BR so you will be borrowing money just to life and get by, letters and phone calls and stress levels will max'd out.

As long as you can pay back at least 25% of the £50,000 your on a winner as you WILL be able to afford to buy food and rent and live without the worry of paying your debts and within 5 years you will be debt free. So IVA will be the best option as £37,500 will (plus fees) will be wiped off your debt....happy days!!

Say before you start your IVA you come on these boards and people tell you, claim your PPI first then do the IVA....You get your £10,000 refund...HAPPY DAYS, that can go towards your mountain of debt that you have been worrying over....but you'll still owe £40,000 that you cant afford pay back in a reasonable time and still have stress, money worries so you do an IVA as long as you can pay back at least 25% of the debt you will be fine. So £30,000 plus fees is wiped off and your debt free.

Tell me whats the difference?

This is only an issue where an IVA isn't the right choice to start with....theres a thread on here when after the IVA finished and the IP claimed the PPI refund, the individual would of paid back nearly 100% of the total debt but still will face the issues with having an IVA and rebuilding of their credit again....clearly an IVA was the wrong choice at the time.

Hi

Thanks for the reply and I can see your points to a certain extent on the example case figures you have quoted.

There could however be very big differences on other circumstances and figures, perhaps leading to options other than an IVA.

The questions still stand for anyone else to comment.

PS - I am going off line now, going for a pint, not had one for nearly 4 weeks, that is long enough until I try again:)

My take

Find_The_Real

I think for those thinking about an IVA the PPI issue is going to become a lot clearer as it now should be mentioned in the proposal, and people are more aware of the whole saga. I see a number of IP companies now have a small section devoted to PPI claims when in an IVA.

As to not advising before it could be that due to the fact that once an IVA has been accepted the IP becomes a supervisor rather than the nominee, they may be bound under protocols that they cannot advise to claim PPI before an IVA, I guess it would be like the IR offering advice on tax avoidance schemes and I should imagine IP's just wouldn't want to get into this sort of area as it is still unclear. Just my own idea here though.

I see this to be more of a problem of those that have already been in an IVA a number of years and may not have had clear instructions (hence the MVM's and a number of guidance documents issued), as I generally do believe the whole sector just didn't realise what an impact PPI miss-selling was going to have.

There also brings up the other question of just how much of it was miss-sold when it has been rather well documented that some IP firms are using the completion certificate as a "sweetener" to claim it was miss-sold (some may interpret that as extortion/blackmail) which in my very own opinion is leading to claims that would perhaps never had been made.

I can see both sides as why should PPI money that has nothing to do with the debts owed be taken by the IP but on the other hand I can also see that as in a lot of cases a significant amount of debt has been written off and it is only right that the PPI claim should go towards paying off more of the debt amount owed.

Depth_Charge

Find_The_Real wrote: »

I think for those thinking about an IVA the PPI issue is going to become a lot clearer as it now should be mentioned in the proposal, and people are more aware of the whole saga. I see a number of IP companies now have a small section devoted to PPI claims when in an IVA.

As to not advising before it could be that due to the fact that once an IVA has been accepted the IP becomes a supervisor rather than the nominee, they may be bound under protocols that they cannot advise to claim PPI before an IVA, I guess it would be like the IR offering advice on tax avoidance schemes and I should imagine IP's just wouldn't want to get into this sort of area as it is still unclear. Just my own idea here though.

I see this to be more of a problem of those that have already been in an IVA a number of years and may not have had clear instructions (hence the MVM's and a number of guidance documents issued), as I generally do believe the whole sector just didn't realise what an impact PPI miss-selling was going to have.

There also brings up the other question of just how much of it was miss-sold when it has been rather well documented that some IP firms are using the completion certificate as a "sweetener" to claim it was miss-sold (some may interpret that as extortion/blackmail) which in my very own opinion is leading to claims that would perhaps never had been made.

I can see both sides as why should PPI money that has nothing to do with the debts owed be taken by the IP but on the other hand I can also see that as in a lot of cases a significant amount of debt has been written off and it is only right that the PPI claim should go towards paying off more of the debt amount owed.

Hi

Thank you, a very interesting post, covered the subject well.

How many times do we see concerned posters asking questions on PPIs issues relating to IVAs just as the O/P has in this thread.

Making things clear in the best interests of the people in debt is surely what debt advice is supposed to be about.

An IVA is a serious commitment, all options and issues should be clearly advised and explained at the outset every time.

New clients seeking debt advice have the right to know before they make any decisions on what option is most appropriate to their particular set of circumstances.

I will say again - how taking huge amounts in commission and fees out of the arrangement concerning PPI claims can ever be in the interests of the debtor or the creditors is beyond me as I thought that these two were what an IVA was supposed to be about - getting the best for the client and best return for the creditors (the latter we often keep hearing about)

Stepchange have some interesting information on their site which has me scratching my head as to some of the other things I read and hear on the subject of PPI and IVAs.

Links below to information on IVAs & PPI from the Stepchange website that are very much worth a read in my opinion -

http://moneyaware.co.uk/2012/05/can-i-reclaim-ppi-while-on-an-iva/

http://moneyaware.co.uk/2012/06/reclaim-ppi-for-free/

The points & questions still stand for others that may wish to comment or 'dabble'

Come on where are ya?

My take

Anondebtadvisor

Many people in IVAs who are having PPI issues and coming to the end of their arrangement, so would have entered into an IVA 5/6 years ago, nobody could have envisaged how big the PPI fiasco would have become.

You can find the guidance on PPI issued by the regulatory bodies here - https://www.icaew.com/~/media/Files/Technical/Insolvency/helpsheets-and-checklists/personal-insolvency/guidance-note-on-payment-protection-insurance-claims.pdf