I had an IVA approved in July 2011 for £450 per month with a dividend of 40.62p in the pound. My husband lost his job in Dec 2011 and our income has dropped by £800 per month. I maintained my IVA payments until May 2012 and then had a two month break. He isn't entitled to benefits because my salary is too high. It will be difficult for him to find another job quickly as I travel with my job and stay away from home a few nights each week, he needs to work flexibly part time (as we have an 11 year old son), is unskilled and is 55 years of age. He has applied for jobs and had interviews but no success to date. I have discussed my situation with my IP and am thinking of proposing a permament variation to amend my payments to £150 per month (this is all we can afford on my salary)as I am not confident my husband will get a job in the next few months and I don't want to keep accumulating arrears or extended months onto the length of my IVA. However this will only offer a dividend of 10.93 in the pound. (I a hopeful that my husband will get work eventualy and then we can increase our payment. My IP won't give me any indication of the liklihood of £150 being accepted and I'm worried that the IVA will fail if creditors don't accept. My creditors are MBNA, Barclays,Capital One, Santander and Halifax Any advise on whether this low dividend is likely to agreed would be greatly appreciated.
I personally would accept the offer and your IP is clearly hopeful the variation will be accepted. It is through no fault of your own that this variation is being drafted and we have closed down cases at pennies in the £ and even fractions of a penny in extreme cases.
While the dividend is a factor in deciding whether to accept, your behaviour and complaince are also important and I am sure creditors will accept the variation. There is always a possibility your husband finds work and the dividend increases but even if he does not your offer still beats bankruptcy.
If 10p in the £ is the best that you can manage, given your changed circumstances then there is no reason why this would not be accepatble to your creditors. Do make sure that you can realisticaly afford this sum, and are there any reasons why bankruptcy proceedings may not be a better solution now?
Thank you Michael and Melanie - your advise is more encouraging than my IP - I think they are just being cautious about giving any indication in case it does get knocked back.
Re Bankruptcy option - I don't want to go down this route as I am a home owner (mute point as I am in negative equity so technically the bank own it....)and don't want to put my home at risk or have the public shame of bankruptcy. I'd prefer to stay with the IVA and pay back what I can.
PJG Recovery have a free online advice channel at www.debtadvicetv.com. If you are ready to ask us for specific advice or help, then get in touch at www.pjgrecovery.com/contact-us.asp . I look forward to speaking to you.
Great news Sasha I'm sure you'll find time to celebrate over the weekend!
Regards, Tina Shortland, Debt Advisory Manager for Melanie Giles at Debt Advice TV.
If you’re looking for effective debt related information, articles and news, then go now to our on-line advice service at www.debtadvicetv.com
If you’re ready to ask us for specific advice or help, then get in touch at www.call-me.debtadvicetv.com so you can start to free yourself from the stress and anxiety of overwhelming debt.
Hi Sasha. That's great news - I'm so pleased for you and hubby! I think cases such as these do add a 'human face' to IP's and creditors too. Maybe 'back in the day', such dividends would have been less acceptable, but in these continued times of recession and severe financial hardship, they know they have to deal with the reality that some people just cannot pay as much as originally agreed. It gives hope for many who come onto this forum and/or exploring viable options for dealing with their debt problems. Thanks for sharing Sasha!! x
IVA journey started: 30th March 2009. Settled: 17th July 2012. Completion Certificate received: 13th March 2013. Breathe. x
It certainly is a sign of the times GilliB. We are regularly getting divdinds of less than 10p in the £ accepted by creditors, which five years ago would have been largely unheard of.
