First year review

[kitkat44444]

Hi,

Now coming up to our first year review in our IVA and had a letter requesting 12 months payslips, P60s etc. Since we started our IVA our income has dropped by approx £1,940. Our total debts are just under £24K. For our first year we have struggled to pay our monthly contribution of £275pm which equates to 41.39p in £. What are peoples views on the minimum payment which would be accepted by creditors? Trying to work out a budget for the income/expenditure which doesn't leave us with nothing to live on!!! Any thoughts?

kitkat44444 (9 months down 51 to go!!)

Kitkat44444

[hara]

The minmum payment is 200.have you informed your IP of drop in income.

If you seeking to payless over the period of IVA your IP may have to call a variation meeting.

As I see you are returning 41.39 p in the pound.I feel a case should be made to pay less to alleviate hardship.

Hara.

[kitkat44444]

Hi Hara. Thanks for your quick and very helpful response. My husband was made redundant at the end of last year and due to the lack of jobs in the area he retrained for a different career (paid for by government) and he is now on a trainee salary for the first three months of his new job. We managed to keep up the £275 IVA payment each month plus mortgage and secured loan payments from his redundancy money but that has all gone now leaving no contingency or surplus funds. Also came to end of fixed rate just after IVA was agreed and we all know what has happened to interest rates since Oct 06!! Have kept IP informed every step of the way and he let us miss one months payment when the redundancy money ran out - then my husband got his job so hoping things can turn around for us from now on if we can get the creditors to agree on a lower monthly dividend. Fingers crossed!

Kitkat44444

[Adam Davies]

Hi
A good reply from Hara.
You must fill out a new income and expenditure form and show your reduced disposible income.Although Hara is correct that £200 is generally the minimum amount there are cases of lower payments.
You need to ask your IP to propose a variation meeting for reduced payments,although some IVAs have clauses that no variation is allowed in the first two years.
Regards


Andy Davie
IVA.co.uk Spokesperson

About me:
http://www.iva.co.uk/andy_davie_profile.asp

IVA Helpline: 0800 197 4838
http://www.iva.co.uk/iva_helpline.asp

[hara]

I am glad to know that your husband got a new job,though gets paid less.

As I see it things appear to be restrictive.

It always wise to keep IP informed all the time

If beneficial interest rest does not apply any more,how about seeking permission of IP to remortage to a similar amount of mortgage that you have to bring mortgage payments to the level that you had before Seeking IVA.

I do not see why it should not be granted

Hara.

[hara]

At the end of the day Your IP and creditors must see that there real hardship and misery involved here.

While I appreciate the creditors interest in recovering as much as possible a sympathetic approach must be extended to troubled souls,especially as every effort is made to return as much as possible to creditors than going Bankrupt

I say this very well aware of the fact that Banks are making huge profits and record profits.

Hara.

[kitkat44444]

Thanks to Hara and Andy - all wise words which we shall take on board drawing up our revised I&E report and speaking to IP.

Kitkat44444

[MelanieGiles]

You could also consider remortgaging to consolidate your current mortgage and secured loan - perhaps on an interest only basid to benefit from lower payments. This will only be possible if you have equity in the property at present, and is obviously not a sensible solution in the long term as you would not be paying any capital off those loans

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk