I have come into an iheritance

[northumbrian69]

I don't profess to be a financial expert but the way I was taught maths at school the total owed using this IP's exorbitant 25% of all realisations would calculate as follows:

Left to pay = £54,602 (total debt + 8% per annum interest)

IP's fees @25% + VAT = £54,602 x 25% = £13,650 + VAT = £15,971

Total to pay = £54,602 + £15,971 = £70,573

Still extremely high but nowhere near £77,312, plus I don't quite understand where the £7,205 you have already paid has gone[?][?][?].

I would most certainly be challenging your IP about this, it seems everyone benefits fron your windfall except you, your creditors get paid in full plus interest and your IP is on a nice little earner for doing less work because your IVA would be wound up early.

If all IP's conducted themselves in this manner the failure rate for IVA's would go through the roof, he certainly doesn't have your best interests at heart.

Hi, received this explanation from IP, though still didn't account for a lot of money, so have cut and pasted the emails, any advice if this is correct would be greatly appreciated

''Please find enclosed a full breakdown from our accounts department –

Stat Interest applied as follows:

Total debt - £46,307.96

Yr 1 @ 8% = £3,704.64 - £50,012.60

Yr 2 @ 8% = £3,704.64 - £53,717.23

Yr 3 @ 8% = £3,704.64 - £57,421.87

Yr 4 @ 8% = £617.44 (1 sixth as a part year) - £58,039.31


Disbursements - £245 taken

Nominee fee - £2,500

Supervisor fee - £500 – Variation Meeting

VAT - £525



Totals £3,770

Paid to date - £7,205

Interest - £2.30

Totals - £7,207.30

LEFT TO PAY - £54,602.01

Amount required - £77,312.58''

When i questioned the amount difference from £54,602.01 and £77,312.58 this is the reply i got. Is this correct, just on £23,000 fees????

''Sorry, the last email was probably not very clear.


The additional monies are Supervisors fees @ 25% + VAT''


Please help, this amount in fees seems excessive

[Emmet67]

Thanks for that Northumbrian, I worked this out too which doesn't give me a great deal of confidence i PPs accounts team. I wonder if they can't add up maybe they missed out a decimal point. 2.5% fee not 25%?!
All gone to PPs Compliance Manager now so just wiating to hear from her. Will keep you all informed on this forum as whatever the outcome - it's an interesting test case

[Emmet67]

Hi all

The case of fees has now gone to the Compliance Manager. She says that I am liable for all fees as it was me who engaged the assistance of an IP. They have reduced their fee to 15% and given the below as Final Payment instructions:

Total debt £46,307.96 + 8% interest up to 30 June 2010 @ £10.15 per day = £12,098.80

£46,307.96 + 12,098.8 = £58,406.76

£58,406.76 plus fixed fees of £5,973.47 minus £7605.00 (already paid) = £56,775.23

£56,775.23 + Payplan fees @ 15% plus VAT = Total £68,922.89

This makes the IPs fees alone £12,147.66 plus other fees of £5973.47 = £18,121.13 that Payplan are saying I owe them.

I have tried arguing that as I was never expresley told that I would be liable for these that I cannot be held accountable but they just will not accept this.

Can anyone help at all with this as I am worried that the longer it goes on the more statutory interest is added (and Payplans fees increase)

Many thanks

[sprowstonboy]

Am i right in reading that you pay a supervisors fee on the interest, effectively making the 8% interest rise to 9.4%?

They also seem to be charging you a 15% fee on the fixed fees of £5,973.47

Finally by my calculations 57,665.23 @ 15 % = 8,649.78
Vat @ 17.5% on 8,649.78 = 1,513.71

57,665.23 + 8,649.78 + 1,513.71 = 67,828.72

Now either i'm an idiot, you're not having it explained to you properly or someone else's maths is rubbish!

[Emmet67]

I've been given so many different figures my head is spinning - I pointed out that initially I was told the total amount with stat interest was £54,602.01 a few monthes ago and that now I am being told it is £58,406.76
The compliance Manager simply stated "I can't explain where the initial figure came from and apologise"

[Emmet67]

I'll double check figures tho as your post makes interesting points that had crossed my mind also so many thanks for that Sprowston - thought I was going mad!

[sprowstonboy]

I'd request a full breakdown of item by item breakdown of debt, interest, fees and VAT. You have to be comfortable that the amount you are paying is correct...and this lot are not providing that comfort

[sprowstonboy]

whoops that reads terribly...hope you catch my meaning

[Nicola.sa]

This is absolutely disgraceful!!! I am disgusted that something like this could happen and my heart goes out to you!! I hope that people take note of the company 'Payplan' who are involved here and perhaps think twice about signing up to their services!!! I personally would be tempted to take them to court and let the judge decide if those fees are fair!

[Skippy]

Payplan do get good reviews on here so I have to say I'm surprised at this.

I hope you can get this sorted out Emmet. Let us know how you get on x

[MelanieGiles]

Whilst this does seem a high amount, Payplan have compromised on the 25% fee and reduced this to 15%. This is a much fairer result for you, and I do not feel that you have grounds for further complaint. You have to balance the costs against the savings you have made in interest over the period of the IVA, coupled with the fact that your creditors have not been able to pursue you.

Most IPs would rather be remunerated as we used to be on the basis of a fixed fee for each year's work - personally I have never been paid on the basis of time costs, which I deem unsuitable for this type of work. Had your IP been paid on the basis of fixed fees, I believe that you would now be paying a lower sum - but regrettably the current fee charging structure has been enforced upon us by the creditor market.

[Emmet67]

Hi Mel... want to say thanks for all the advice. Without you and all here would not have got down to 15%.

[MelanieGiles]

It is my pleasure, and yet again another demonstration of the weight of this forum in its marketplace. iva.co.uk achieves another fine result for a valuable poster - although I rather suspect your IP looked at this again and realised that he was getting well paid at 15%.