PPI claim rejected pre IVA, now in IVA will be paid to creditors!

Davey112

Hi all,


I am after some advice on a PPI claim and an IVA.


I started my IVA in April of this year and so far all has been well. Whilst going through the IVA process I was told that to complete it I would have to agree to a claim company looking into any PPI claims I may have.
As I had previously, some years back tried to claim PPI from current and previous creditors, I had no issue with this, as I was sure there was no outstanding PPI claims.
However.. during the reclaim process, I received a letter from one of my creditors, saying that although I had tried to reclaim PPI back in 2012 and I was unsuccessful, the claim now (for the same account) was valid and will be paid into my IVA.
Is it right that they could decline my previous claim, yet uphold it now a claim company is involved?
After all, if I had been paid out back then, I may have not had to go into an IVA now as I could of used that money to clear some debts!


I am aware that any assets will be shared out amongst the creditors whilst in an IVA, but my anger comes at them refusing my original claim, yet now upholding it.


Thanks for your time and advice in advance.

debtfree2016

Hi Davey112, more and more banks etc are under pressure to resolve PPI claims. I like you would have avoided the IVA route if I had been persistent in claiming PPI. Unfortunately the PPI will be paid into your IVA and you should receive 8%. Sorry I know it wont help the anger side but there argument would be you should have taken it up with a complaint back in 2012. Is one of them a creditor within the IVA ?

Davey112

Hi , Thanks for your reply. They are a creditor in the iva yes, but for a different account.

So even though I did try to claim in 2012, and they said I never had ppi, this can still happen as they got it wrong and told me I never had ppi, when in fact they have now said I did and have sent a cheque into my iva?
Surely there is some grounds that they either lied, or never investigated it correctly?
I have been told I will receive £100 from a nearly £6000 refund by my IP, is that not correct then?
Thanks again.

sarah222

Unfortunately PPI will form part of your IVA - I understand your frustration at this as we are and were in a similar boat. On signing the IVA form any future claims for PPI will go to the fund regardless of the actions by this company previously. I think initially people were told as you were there was no PPI - however with it getting a lot stricter etc on reclaims companies are having to look deeper and review their previous claims. This is really annoying and upsetting as I do appreciate that you could maybe have avoided the IVA if they had done this correctly in first place. Going forward all claims will go to the IVA. We completed our IVA over 3 years ago and have a completion certificate. However Lloyds just reviewed our previous claim and found they owed us a further £1800. They paid it direct to IVA despite this being completed. When I queried it saying at what point will we be free I was just shown the IVA legislation that states all PPI claims regardless of time must be paid into fund or they can revoke the IVA completion if I object or try to hinder any claims!

Davey112

Hi Sarah222,
Thanks for the info.
How frustrating is that!! Nobody wants to go into an iva, it's a means to an end which has strict conditions to abide by, which in itself is quite frustrating and worrying at the same time. Which from what I'm reading never actually ends at all! It's like the creditors are always going to have a hold over us, and any bit of good news we get is completely dashed as they are always there with their hands in our pockets.
They agreed to the conditions of freezing interest etc and getting back a good percentage of what was owed to them, why the hell should they be able to keep taking and taking! That is not fair at all on people like us that have already enough stress because the creditors in the first place were ramming credit down our throats! It was in my case anyway.
The legislation needs to change or else how can people finally put bad credit decisions behind them and move on?
Thanks again for your reply, and I feel for your frustration as I have the same, an I'm not even a year in! Guess I just gotta shut up an be dictated to for however long they decide.

sarah222

Unfortunately yes - Im still getting debt letters which I just forward to our IP and they have to chase up ensuring the records are adjusted correctly. I had Lloyds recently refund £1800 which was so annoying and the same week got a letter from a debt collected saying they chasing a debt they took over from Egg. Egg were in IVA and paid off some 3 years ago. My credit score is very poor not that I need or want credit now but it is very frustrating. Technically my IVA started over 9 years ago and finished 3 years ago and I don't feel free. I do feel more in control but do think maybe I would have been better going bankrupt.

Davey112

These are the kind of things IP's should be telling us before we agree and are sucked in by them giving hope by saying everything will be ok after the iva is completed. Not only have we been miss sold ppi, I now think I've been 'miss sold' an iva!
It never rains, it pours.
Do you think it is worth seeking legal advice? After all, it's becoming very clear that every financial organisation is corrupt!!

magpiecottage

sarah222 wrote: »

got a letter from a debt collected saying they chasing a debt they took over from Egg. Egg were in IVA and paid off some 3 years ago.

In that case, you have a valid complaint against both the debt collector and Egg for pursuing a debt that it was agreed you had paid off. This is probably worth pursuing as such and if you do not get a satisfactory response, you can take it to the Financial Ombudsman Service (free of charge).

I would expect one or other them to correct their records and pay a modest sum in recognition of the "trouble and upset" caused. That should come to you outside of your IVA.

magpiecottage

Davey112 wrote: »

I now think I've been 'miss sold' an iva!

If you think you have been missold an IVA, you can complain to the seller and, if necessary, to the Financial Ombudsman Service.

With regard to your original PPI claim, the Financial Ombudsman Service, Financial Conduct Authority and Claims Regulator all say that involving a CMC makes no difference to the outcome. However, a number of financial businesses have had to review plans where complaints were previously incorrectly dealt with.

However, there are particular concerns when debt counsellors (including IVA companies) get their customers to use a CMC to recover PPI. This is because there is often a conflict of interest.

This comes in one of two forms. The first is that the CMC pays a fee or commission to the debt counselling business and neither tells the customer it will receive that commission. Depending on the circumstances, this can be deemed to be a bribe.

Earlier this year, the Financial Ombudsman Service ruled that a business must declare any commission it will receive for referring a customer to a provider of an ancillary service. In that particular instance, it ruled that the commission must be reimbursed to the provider.


The second is that the debt counselling and claims management business are substantially in the same ownership. Again, if you are not told of that then you have a valid complaint if they did not draw this to your attention. In most cases, the ownership of each business can be found out from the Companies House website.

Either way, if a debt counselling business recommends you to a CMC in respect of PPI, this is likely to be bad advice since they only use the same, free, service that, as noted above, produces no better outcome.

Although it is almost certain that any redress would go toward clearing the IVA, if all of it goes there, this will clear it more quickly than if either does. A complaint to the debt counsellor that you were misadvised to use a CMC to do this might produce a rejection but if you then took it to FOS, arguing that they should have told you it was free would put FOS into a position where you were using its own stance on the matter to argue that you were misadvised.

Davey112 wrote: »

Do you think it is worth seeking legal advice?

No - both FOS (in respect of the original seller of the PPI and the IVA provider) and the Legal Ombudsman (in respect of the CMC) are free.

Davey112 wrote: »

After all, it's becoming very clear that every financial organisation is corrupt!!

No it's not. You might have met some that are incompetent - and maybe some that really are corrupt. However, your sample is not statistically significant.

Davey112

Thanks a lot for your advice, you seem to know your stuff.
The iva company I'm with is payplan, and I think the claims company, credo claims is possibly under the same umbrella as their address is very similar. I was told to complete the iva I have to agree and comply with credo's requests, which I have done.
As far as the money from the ppi reclaim going towards clearing my debt in the iva, I have been told that it makes no difference to the term of the iva or the amount my monthly payments will be as it is all based on my monthly income and expenditure. So I'm at a loss as to see how it will help clear my debt to be honest.
My total reclaim for ppi (2 i have not mentioned as yet) that credo have looked into, minus their fees is just over £7000, which is a lot of money that I am led to believe will just be distributed out towards all my creditors. Yet my payments and length of term will not reduce.
Very confusing and very distressing to be honest, but thanks a lot for your info and advice.

foxy-stoat

If you look at the whole picture you may feel better about things:

What is the difference between your total debt prior to your IVA divided by 60 and your current IVA monthly payment?

That will give you the amount of debt that you WONT be paying back. As long as its more than £7000 then you are still a winner.

Just so that you are aware of, if you won the lottery or received another windfall, that would have to be declared and all or part of it be paid into your IVA. Its not all bad.