PPI Claim Possible ???

londonerryan

Hi everyone.

I have a friend who recently declared bankruptcy because of debts incurred on a credit card and with bank account. She wants to know how to find out if she was mis-sold PPI.

I'm not sure exactly what she can achieve, if anything, but i said i'd ask.

This is her story in bullet points (as told to me):

- My friend is foreign and her English isn't great.
- Natwest gave her a credit card.
- She spent far too much on it (something like £10,000).
- She had severe mental health issues and this resulted in her handing her card to people to pay for things for her (i.e. suggestion she didn't really 'know' how much she was spending).
- She had no idea what she was signing up to (e.g. PPI).
- She was only paying off interest for about 6 years.
- Then for about last 3 years she was paying off the debt, as she couldn't afford to pay off interest.
- She said something like they reduced her monthly payments from £150 to about £9 a month because of her financial issues.
- Bank wrote her a letter not long ago saying they wanted her to pay off the remainder of her debt (i think she said they offered her a settlement of £800 for her remaining £2500 debt).
- Citizen's Advice Bureau suggested she filed for bankruptcy.
- She couldn't afford to pay the debt off and so got a lawyer, went to tribunal, and filed for bankruptcy which was accepted.

Personally, i'm not sure how she could claim anything back as she declared bankruptcy. Isn't that the equivalent of wiping the slate clean and having no debt but also having nobody owe you anything either?

My questions:

1 - Can she actually claim for anything if bankrupt?
2 - How does she find out if mis-sold PPI? (Write to Natwest?).
3 - Do credit cards even offer PPI? I thought it was just loans. I've never had a credit card in my life, so no idea how they work.

dunstonh

1 - Can she actually claim for anything if bankrupt?

no. She can complain but she is not entitled to the redress if successful. it is paid to the official receiver and distributed to those she failed to repay when she went bankrupt

WatchMan

londonerryan wrote: »

My questions:

1 - Can she actually claim for anything if bankrupt?
2 - How does she find out if mis-sold PPI? (Write to Natwest?).
3 - Do credit cards even offer PPI? I thought it was just loans. I've never had a credit card in my life, so no idea how they work.

1) When your friend entered into bankruptcy, certain assets passed to the trustee in bankruptcy. The right to make a claim against the mis-selling of PPI is one of these assets which passed to the trustee.

As such, your friend alone does not have the right to make a complaint. However she can speak to her trustee and ask them if they will take it forward.

If they do, and she wins, she does not have a right to the money - this also belongs to the trustee.

2) Her trustee will be able to advise her better. It may be worth checking out the Financial Ombudsman's website to see what the common issues with PPI are. It would then be a case of her taking some time to think over whether any of those issues could have potentially affected her.

Normally, it would be a case of writing to the business - setting out your complaint - and waiting to hear back. However your friend will have to speak to her trustee first.

3) PPI was added to credit cards. It could be added to anything where there is a repayment to be protected.

[Deleted User]

londonerryan wrote: »

Personally, i'm not sure how she could claim anything back as she declared bankruptcy. Isn't that the equivalent of wiping the slate clean and having no debt but also having nobody owe you anything either?

This is EXACTLY what bankruptcy is.

There is no point in any bankrupt person seeking PPI redress as it is a pre-bankruptcy asset and will never be awarded to the individual personally.

Talk of "trustees" elsewhere in this thread applies in Scotland only.

roonaldo

It must be great if we could all take out loads of loans, spend all the money, not pay it back and then ask for your money back ! It's incredible how many people think this is possible.

WatchMan

Moneyineptitude wrote: »

This is EXACTLY what bankruptcy is.

There is no point in any bankrupt person seeking PPI redress as it is a pre-bankruptcy asset and will never be awarded to the individual personally.

Talk of "trustees" elsewhere in this thread applies in Scotland only.

Replace trustee with official receiver.

As for whether there is a point in making a claim, if successful, the redress would reduce debts - which arguably is a responsible thing to do. Of course there is no financial advantage for the OP's friend.

[Deleted User]

WatchMan wrote: »

if successful, the redress would reduce debts

Debts which have already been written off as part of the bankruptcy, of course.
A completely futile exercise for a bankrupt.

londonerryan

Thanks for all the information.

It seems like there is no point in her seeking to chase up any potential mis-sold PPI.