Income Increase

[Andy C]

Hello, My income is set to increase by £350 per month can anyone advise what additional my IVA agreement will require from that increase? and also if my payment increases can I ask my IP to negotiate a reduction in my IVA by one year as it was set up as a 6 year IVA originally?

thanks

[Shining]

Hi Andy, unless you'll have paid 100% of your debt owing (pre-IVA) plus fees and any interest due then your IVA will not be reduced due to an increase in payment. It will mean however your creditors receive a larger divident towards your debt, however if all is paid then the IVA will conclude.

Most IP's will ask you to report any change in circumstance i.e. your wage increase straightaway but some do not take action upon this until the next review others straightaway so it will depend on your IVA company really. It could be that only 50% of the increase is payable and you get to retain the other 50% but either way remember that things are always getting more costly so do ensure your Income and Expenditure form reflects both sides of the increase.

[Michael Peoples]

I can only agree with Lesley but to keep yourself right you should notify your IP. I doubt if the IVA term would be reduced because you agreed to make extra payments when you originally entered the agreement.

[Andy C]

Thanks for the replies,

My annual review is due soon and will probably fall around the same time my income increases so no worries there although I am planning on moving in with my partner so my review is going to be a messy one and will have to include her income ect not looking forward to that but never mind it must be done.

thanks again,

[MelanieGiles]

The answer will lie within the specific terms of your proposal, but if it was presented in line with the IVA protocol then you should expect to pay over 50% of your new disposable income having allowed for any reasonable additional costs incurred during the year.