Income and expenditure

[hara]

What is the rationale of annual I&E review?

Is the whole idea to see whether an increased payments can be paid? or is there a case to pay less.

As I understand IP makes a decision as to whether payments increase or not?

If there is not a great deal of reduction,can they make a decision for making a reduced payments?

Hara.

[MelanieGiles]

The general principle is to see if payments can be increased. Payments can generally only be decreased with the agreement of creditors at a newly convened creditors meeting, although a number of creditors are modifyin in the ability to reduce payments by up to 15% if circumstnaces have changed at the discretion of the IP. Without this modification, IP's have no discretion to reduce payments without a resolution from creditors.

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

[hara]

Dear Melanie Davies,

My proposal has amended clause which says that If Debtor wishes reduce contributions into the arrangementby less than 15% the should be requested to remedy the short fall by making additional contributions in to arrangement.The term of arrangement is nt to exceed 72 months as originally agreed by creditors.

Does it mean I can avail this if Mortgage rates goes up? and I encounter Difficulty, as long as I make up short fall later.

[MelanieGiles]

Melanie Giles???

This modification is helpful for you as it allows you to reduce your payments by up to 15% on an ongoing basis, providing that the arrears can be made up over an additional year. So if you do have to pay a higher mortgage, there is leeway in the proposal for you to do so.

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

[Adam Davies]

Hi
Now that sort of modification seems so sensible.Can the IP put this in the proposal or does it have to come from a creditor ?
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

[MelanieGiles]

This can be written into IVA proposals, but I suspect most IPs are not doing this as it is only requested by certain creditors.

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

[Adam Davies]

Hi
But this would solve the problem regarding affordability when mortgage interest rates go up and for proposals that the debtor finds simply too tight after a few months,especially if there is a no modification clause within 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

[MelanieGiles]

Yes - but it could also be open to abuse, and to be frank I have never had a problem in getting a client's payments reduced at a variation meeting if there is good cause, so the current system works equally well too - obviously you have a point with the "no variation for 24 months", but in my experience these are very rare!

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

[Skippy]

I had the no variations in 24 months modification, and with hindsight I wouldn't have agreed to it. 2 years is a long time to struggle, especially with interest rates going up and up.

Yesterday is history, tomorrow is a mystery, today is the present - a gift to make the most of.

View my blog at http://skippy13.blogs.iva.co.uk/