www.iva.co.uk

My mum is in the last year of her iva. She had £9000 debt and paying every month £101 on the dot.
The iva company decided to see if she could get ppi back on her loans and did so to the sum of over £12000.
So when asked why mum still would have to complete her final year was told they would need to calculate figures and see. Surely she should be entitled to money back??
Can you please advise

Hi,

Was the £9000 her total debt or just what was to be paid back to the IVA company?

Hi kallis 3

Yes mums full debt was just under £9000.

Hi. During an IVA you always owe the original debt, plus fees and possible statutory interest.

Using quick, "on the back of a cigarette packet" calculations, which are very rough and assume the usual fee structure (which is far from guaranteed to be the case) :

To achieve 100% payback on a £9000 debt would require around £15450 to be paid over on a 5 year term. Taking off a years statutory interest, would mean a payment of £14730 to close at the end of year 4.

In her 4 years your mum has paid in £4840, plus the PPI.

Of the £12,000 PPI recovered, around 30% would be lost in recovery company fees, leaving £8400 for the IVA, of which 15% will go in IPs fees, so, in reality, only £7140 will reach creditors.

So, the IVA has had around £11,980 paid in, which is still short of the amount needed to close early.

Thanx for that froggy it helps and is more clearer than being told nothing from the iva company

Wow Foggy is on form today - I;m glad you replied before I had to get my calculator out

Nice one Foggy!