If you have finished your Individual Voluntary Arrangement (IVA) it is possible to make claims for PPI mis selling. Even if your Arrangement finished some years ago you can now make PPI claims which could be worth £1000s.
Jump to article content:
- Find out why claiming for PPI mis selling is possible after an IVA
- Understand how will the banks react to your claims
- Should you get help from a Claims Management Company?
- What are your options if you are still in your IVA? – Find out more below
The deadline for claiming for PPI was 29th August 2019. If you did not make your claims before that date you are no longer eligible. No new PPI claims can now be submitted.
Are you allowed to claim for PPI Mis Selling after an IVA?
If your IVA has finished this means that any outstanding debt you owed to the banks has been written off. However this does not change the fact that you may have been mis sold PPI before your Arrangement started. As such you can now make a claim.
The mis selling of PPI is a separate issue to whether or not you only part paid back your debt. In the same way as if you had paid off your debt in full your claim must still be considered. Compensation must be paid if you were mis sold.
Before starting any claims you must have your Compeletion Certificate . Before then your Arrangement is not formally completed. Any compensation would still have to be paid to your IVA company.
Will Banks pay the PPI Mis Selling compensation you are due?
If you claim for mis sold PPI after you have been through an IVA it is highly likely that the banks you claim against will tell you that they do not have to pay you the compensation you are awarded. They will use two main arguments to prevent you from getting your money.
The Off-Set argument – Firstly the bank may say that the money should be kept by them to off-set the outstanding debt that they are still owed because you went through an IVA.
The unrealised Asset argument – Secondly they may argue that the compensation you are due is an unrealised asset (or an after acquired asset) of your Arrangement. As such they claim it should be paid directly to your old IVA company.
Should you get help from a Claims Management Company?
If you are dealing with your PPI claims yourself and the banks refuse to pay your compensation to you it is unlikely you will get your money.
You can escalate a complaint to the Financial Ombudsman. However if upheld they are still likely to say take the side of your Insolvency Practitioner.
For this reason if you are claiming after an IVA it is best to consider working with a claims management company. You will have to pay a fee for this. However you should not be charged unless you receive any compensation you are due.
You should use a specialist claims company who understands the implications of you having been in an IVA and who will not charge you unless any compensation due is actually paid you to.
What are your options for PPI Mis Selling if you are still in an IVA?
Any compensation paid to you while your IVA is still running is a windfall. As such it has to be paid into the Arrangement. Given this if possible it is best to delay making your claims until after it is finished.
Having said that your IVA company may require you to authorise them to make claims on your behalf. If this happens you cannot refuse. You are obliged to cooperate with them to ensure you maximise the amount you pay back to your creditors.
If you were asked to claim for PPI mis selling during your IVA you may still be due compensation that has not yet been paid.
If you believe your IVA company made claims on your behalf during the Arrangement it is still sensible to review your options after it is completed. It is possible that the claims were not investigated properly. In addition you can still make claims against debts that were not included such as debts paid before it started.
Hi
My husband and I had an IVA which was completed in 2008. A PPI company contacted my husband in April 2019 to search for Mis-sold PPI. They were successful in having a complaint upheld by RBS and won a successful payback on 16th April 2020. The redress was for £1025.67. After sending the acceptance letter back, he received a letter from RBS to state that the money would be going back towards the IVA from 2001 as RBS was one of the creditors that was included in the IVA. We have now been left with a bill of £300 to pay the PPI company. A real lesson learned, that your debt is never paid off and will follow you till the end.
Hi Deborah
I am afraid I do not have good news for you. What RBS have said is correct. Based on the Green v Wright court case (2017), PPI compensation paid after an IVA is completed still has to be paid to the IVA company.
Re the bill you have been left with I suggest you go back to the claims company and tell them that they should have asked you whether or not you had been in an IVA in the past. The fact that they didn’t was almost certainly negligent on their behalf and as such they should cancel their fee. If they refuse I suggest you threaten to escalate a complaint with their regulator (the FCA – Financial Conduct Authority) and they will normally back down.
As a slight aside, re your comment regarding “your debt is never paid off”, this is not true. Once an IVA is completed, any outstanding debt is written off and you no longer have to pay it. This is the law. In addition after the completion most subsequent windfalls you receive are yours to keep. For example a lottery win or inheritance if someone dies after the date of the completion. However, PPI is a very specific case where compensation received after completion still has to be paid into the IVA if the debts were taken out prior to the IVA.
I have completed my IVA which completed in July. I just received a call stating that Ppi will be coming to me but this will have to be sent to my Iva. I would like to know if I received any more money after the completion will I need to send it to my IVA or is it only the debtor who I have add to my Iva agreement?
Hi Maria
This is a very good question. If you receive a lump sum for other reasons after your IVA is completed (for example in inheritance or lottery win), this will almost certainly be yours to keep. PPI compensation is different is because the trigger for the compensation (ie the mis selling) happened before the IVA started. As such compensation subsequently paid is still an asset that belongs to the IVA. In theory the same thing would happen if you got compensation of any other event which happened before or during your IVA. But this is very rare so it should not be an issue.
Hi, I completed my IVA in 2016 and have a letter from RBS awarding be £786.47 for mis-selling PPI from a NatWest account. The creditors agreed an early settlement figure with the IVA company and all agreed. Would this mean I could be entitled to the full amount or can they still divert it to the now settled NatWest account? Thanks!
Hi Simon
Generally speaking all PPI compensation awarded after an IVA has been completed still has to be paid to the IVA company. This is in accordance with the Green v Wright Appeal Court ruling in March 2017. Given this, regardless of the fact that your IVA was settled early (and NatWest agreed to the settlement at the time), you are very unlikely to get this compensation. In addition, in your particular case, because the award has been made by NatWest (formerly RBS Group), they will almost certainly retain the compensation claiming their right of set off. Unfortunately there is absolutely nothing you can do about this.