You can claim for mis-sold PPI during an IVA if you wish. However compensation received will usually have to be paid into the Arrangement.
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- Can you claim for PPI during an IVA?
- Is there any point in making claims?
- What if your IP asks you to claim?
- What if your IVA payments end before claims are settled?
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.
Can you claim for PPI during an IVA?
There is nothing to stop you making PPI claims while you are in an IVA. However you must understand that any compensation received will be treated as a windfall. As such it must be paid into the Arrangement.
If you make a claim it is likely the bank will pay any compensation directly to your IVA Company. If you receive the money you must inform your Insolvency Practitioner (IP). They will usually require it to be paid into your Arrangement.
Do not try to hide any PPI compensation you receive during your IVA. The fact that you were paid the money is likely to come to light anyway at your next Annual Review.
PPI compensation paid against debts not included in your IVA also has to be paid into the Arrangement. This also falls into the windfall catagory.
Is there any point making claims for PPI during an IVA?
Because PPI compensation received during an IVA must be paid into the Arrangement you may ask whether there is any point in making such claims. However it is possible that you could get some benefit.
If the total amount of compensation paid is less than £500 you may be able to keep it. However this will depend on the specific terms and conditions of your Arrangement.
If you have a specific financial emergency your IP might allow you to keep more to cover the extra expenses. However this is not guaranteed and will have to be agreed specifically with your IP.
Claiming for PPI during an IVA will not reduce the length of the Arrangement. If compensation is paid it will simply mean more money is returned to your creditors.
What if your IP asks you to make PPI claims?
If you are currently in an IVA you should expect your IP to ask you to make PPI claims. This is a legitimate request. It is their job to maximise the amount returned to your creditors through the agreement.
Given the Arrangement is still running you must co-operate with them. If you refuse this may lead to a delay in the completion of the agreement.
If your IVA is already completed and you have received your completion certificate then the IP is no longer your supervisor. It is then unlikely that you will hear from them again.
You can make PPI claims yourself after your IVA is completed. However depending on your IP and the terms of your Arrangement any compensation awarded may still have to be handed over as an after aquired asset.
What if your IVA payments end before PPI claims are settled?
The PPI claims started during your IVA may not be settled by the time you have made your last payment. In these circumstances any compensation subsequently paid still has to go into the Arrangement.
This is because even though your agreed payments are finished your IVA is still running. It is not formally over until your completion certificate has been issued to you.
After you have received your certificate you may be able to keep compensation subsequently paid. However this will depend on the terms of the agreement and the attitude of your IP.
In accordance to an Appeal Court ruling in March 17 known as Green v Wright in certain circumstances PPI compensation paid after the issue of a completion certificate will always have to be paid to your IP.