PPI Compensation and closed IVA

[Lilith]

Hi
I had an IVA about 4 years ago.
3 years ago I was made redundant from my job and I was able to complete the IVA in full and have my certificate of completion.
Recently I have been advised by a third party that I took PPI out on a loan a few years prior to the IVA.
This loan was not part of the IVA but I did have a different loan with the same company as part of the IVA.
At the time of the IVA my supervisor checked all creditors for PPI and there was only one which was paid into the IVA.
The PPI compensation I will receive is not a lot of money in fact less than £800 but it will help me as I am job hunting and not in receipt of job seekers allowance.
My question is do I have to notify my IVA Supervisor of this little windfall.
I have read that a court case last year advised that once the IVA certifcate of completion has been received the individual no longer has to declare amounts such as these.
But I do not want to keep the money and then worry about it.
I am IVA free now.
Thank you
Lilith

[Foggy]

Hi Lilith. The recent court case was appealed and the situation, as it currently stands, is that the PPI does still belong to the IVA estate, even after completion.

When your IVA finished was it a full and final offer (lump sum of payments remaining) or a full settlement ( full debt, fees and possible statutory interest) ?

If it was a F&F the PPI belongs to the IVA unless the former IP declares they have no interest. If a full settlement the refund would be yours.

I imagine, in either case, the lender making the refund will want confirmation from the former IP or might just send them the money anyway.

[kallis3]

Agree with Foggy (you beat me to it again!)

[Lilith]

Thank you for the prompt reply.
I will check my paperwork as I am not sure which of the 2 it is.
Thank you again.

[MerlinL14]

You mention 'a third party', did they cold contact you and then you replied to them? What do they know about your financial situation or background. Do they really have all that information to make a defined statement of recoverable PPI funds or did they just take a wild a** guess and come up with £800 ish. How much is their 'cut'? be aware that if the ex IP lays claim to it then you could be personally liable for the 'third party' fees. £800 is not a significant sum but is enough to throw you back into spiralling debt as you say you are job seeking ATM.

[Lilith]

Merlin L14
Yes a Claims company did contact me.
I told them that it was probably not worth my while to claim because it would just go back into the IVA pot.
But at the time the Green v Wright case had
Gone in the debtors favour.
I rang my IP and he said he would have to get clarity as he was not sure and they did not get back to me.
The refund I am getting and the amount is after taking out the claims management fees.
I do not have debts even though I am jib seeking and cannot claim unemployment because I took a career break for 2 years to look after family.
The only debt I have is that I am a mortgage payment behind for the first time in 30 years.
The building society have been very understanding and allowed me to pay £20 a month off the arrears until I get back to work.
Ironically my mortgage is £820 a month and my PPI refund could pay this off.
Is it worth asking my IP Supervisor if I can do this?
Will they consider this as it is my home at risk. I suppose it is worth asking.
Ironically again the PPI refund due is from the same building society as my mortgage but they have not mentioned the arrears.
They have said I will get my refund direct to me in 28 days.
My IP has not contacted me since my query but I know now that the Green V Wright original decision was appealed and not now ruled in the debtor's favour.
I suppose if I tell my IP Supervisor that I have paid off my mortgage arrears with thr refund he will say I owe it to the IVA.
Had I been able to claim unemployment benefit my mortgage would be up to date.
I do not even get council tax benefit.
Just because I have not paid a stamp for 2 years I cannot get this.
After working full time for 37 years and getting certification of completion I am living off my savings now which are dwindling.
Sorry for long post.
Looking at my completion it says full and final offer and statutory interest waived

[MerlinL14]

The claims company are going to want a piece of the PPI reclaimed funds. If your IP says that he wishes to recover the funds from the reclaim he will not be interested in what he claims company would skim off and make a demand for the total amount, leaving you to find the funds to pay the claims company, normally about 40%. As tight as things are now you really could find yourself in further debt because of this potential cold call claims company. Not wishing to put a damper on a potential windfall, but it may not be the resolution you thought it could be.

[Lilith]

Thank you for replying.
I understand what you are saying.
I had already factored in the amount the claims company would get which would leave the £800.
I know the law is the law regarding IVAS but it seems to me that even when your situation is dire and you are trying everything to stay afloat you are damned whatever you do.
I know it is irrelevant but what makes me really annoyed is that the PPI claim is for a loan which was paid off in full and was not even part of the original IVA.
It is also really unfortunate that at the time the claims company made contact with me
The court case Green v White had deemed that the individual could keep the money.
That is why I went ahead.
Then the case was appealed and upheld in favour of the IVA.
Wish I had not bothered now.
Thank you for replying.
I appreciate it

[Foggy]

It sounds to me, as the IP specifically said interest was waived, that you might have settled by paying the full debt and fees ---- in which case the money would be yours anyway, as there is nthing left to pay, debt-wise.

[Lilith]

That is what I was thinking.
Would you mind if I copy the wording they used.
I suppose I really just have to bite the bullet and ask them.
I will get the paperwork out.
Thank you. I really appreciate your support

[Lilith]

Merlin L14
Well the wording on the meeting prior to closure says that due to redundancy I am now in a position to pay the IVA off at 100p in the pound.
It is therefore proposed that statutory interest be waived.
Also originally the proposal said that in year 4 the creditors would ask for me to release equity from my house.
As thrme IVA is now closed I assume this will not happen.
A little confused by the following wording
As of the date of this report the anticipated dividend, excluding the fourth year realisation from the property is 91.51p in the pound. Naturally I am duty bound to investigate the potential for any equity release per the terms of the proposal and will revert back to creditors in due course.
That makes me worry unless she means if they did not accept the proposal.
She then says it is further noted that any successful PPI refund will result in an increase in the dividend time.
Bearing in mind that all creditors in the IVA were checked for PPI one successful claim was paid into the IVA.
This PPI claim was for a loan taken out 13 years before the IVA and repaid in full.
Confused?
Me too!!!!

[Foggy]

I am afraid that is, indeed, contradictory. I think she meant that she would look into the equity position between the dates of that report and the actual date of the meeting (which would have been about a month later). That will have been done and, obviously, did not sway the creditors into refusing the offer. But ....did you pay 100p or 91.51p in the pound, is still the question.

I am afraid you will have to bite that bullet and ask directly. Considering the size of the refund your former IP might just feel it would be uneconomical to dig out old files and calculate a supplementary dividend distribution.

[Lilith]

Yes you are right.
Just tried to call but in a queue and they are in Scotland.
However having just done some maths from what I have worked out I did pay in full.
I started out with 13 k debt and paid off 6k in 3 years.
The balance I paid when I paid early works out as the remaining full balance plus fees.
And the interest was waived.
With a bit of luck...
Will call them
Thank you

[kallis3]

I am assuming you meant you paid what was owed in your IVA and not your total debt?

[Lilith]

Kallis 3
I have just worked it out.
I started with just under 13k debt.
I paid 6k off over 3 years.
I was able to pay early due to redundancy.
What I paid was the full amount owed and fees and the supervisor waved the interest.
The PPI refund I am getting is small and from a loan I took out 18 years ago!
And that loan was repaid in full and not included in my IVA.
I am just going to call them and see what they say.
I have 1 months mortgage arrears and this money would clear the arrears but I will check with them first