My IVA is a 100p/£ paid over 6 years at £1147 pm. The total amount to be paid equates to the whole debt PLUS fees on top. I am 8 months/payments in. I have explained the the IP company that I can take early retirement in November 2010 owing to wife's ill health. I intend to make a full & final settlement at that time so creditors will be paid off 3.5 years early. I have just had to send in first 6 months pay slips. I had a pay rise of £50 per month which I believe only equals the increase in cost of living. The IVA company have asked for almost £200 for the six months from March - September. I haven't got it and have refused to pay it.
I believe that the IVA company are taking liberties. I am paying back the whole debt. I will be paying it off early. Why should I pay more now? when i will pay it off early anyway. I can't see them failing the IVA because of it. If they carry on like this, I'll consider BR just to cheese them off because they will get very little then and my pension is protected (so long as I don't get it until after discharge from BR)
What are you thoughts?
Thanks
Last edited by Bald Runner on Tue Nov 04, 2008 8:08 pm, edited 1 time in total.
I can see your frustration. I wasn't aware that many IVA firms propose 100p in the £ IVA's and will be interested to see the thoughts of our resident IP's.
Andrew Graveson
Bright Oak Ltd
UK Debt Management Company
Website: www.brightoak.co.uk
100p in the £ IVAs are proposed in certain circumstances and I have listed a few examples of why they may be necessary;
1/ A creditor is petitioning for bankruptcy
2/ To prevent a charging order being placed on the property.
3/ The individual has tried a debt management plan but the creditors have refused to accept it.
4/ The individual needs time to pay - e.g. they have no suprlus income but their house is on the market and the creditors will not give them a breathing space to sell it.
Bald runner, please can you clarify your question - you say that your income has increased by £50 a month and they are asking for a further £200 a month? Have any of your expenses reduced? If not their request appears to be a complete nonsense - you should ask the Supervisor of your arrangement how they have calculated the increase in your payments.
Kind regards, Elizabeth Pywowarczuk, Insolvency Practitioner.
If you would like me to advise you about an IVA and if appropriate propose one for you, please visit my website at www.liberta.uk.com
Did your IP explain why they think you can afford an extra £200 a month? Have you spoken to your actual IP or a member of his/her staff? If you haven't spoken to your IP it would definitely be worth doing so.
That is very frustrating. It doesn't make sense to me but I'm no expert. I am starting to worry that I may end up going down the same route I have had a payrise and a lodger, I am paying extra for the lodgers income and have gone down the whole 10% rule with my payrise but he said at my review we will do a new income and expenditure and I really think they will out my payments up again. I am just at a point where I am managing nicely. I am not going mad and Im by no means loaded but I hae a little to go out a couple of times a month and enjoy myself, basically have a life. I know we need to face up to the responsibility of out debts but the amount they left me with before was too little and i think unsustainable for 5 years. I mean £5 a month allowance for a haircut! Also if I pay much more Ill be paying my creditors more than I owe in the 5 years!More a month before the IVA!
Anyway I think the fact your not paying interest might be a big bonus because you would be paying more if you were paying the creditors off in the normal way and also you will be debt free much quicker!
Sorry, should have made it clearer. The £200 is the total for the last 6 months. I guess they will do this every 6 months as that is how often I have to send payslips. My IVA is 100p/£ because 'Egg' would not accept anything less. All other creditors accepted the initial offer of 75p/£. None of the aforementioned reasons from Liberta apply
My thoughts are that given that your debts are in the region of probably £95k, that the interest you are saving is pretty steep - even based upon 15% per annum that equates to £14k per year! The fees being charged by your IP are bound to be much lower - so you actually get your debts paid off quicker under the IVA than in a DMP (assuming no interest freeze and a fee paying management company).
I am not a lover of 100p in the £ IVAs, apart for the reasons detailed by Elizabeth above, however they do have their place, and if you can get creditors to agree to them they have lots of advantages for you - primarily peace of mind and control.
That said, the IVA payments have to be affordable, and it does appear that there is a misunderstanding between you and your IP at the moment. This requires ongoing discussion with the practitioner directly to put your point across and to listen to theirs.
And do not believe that bankruptcy is an automatic right available to you if you cannot get this resolved. A Court ought to look very carefully at any application from someone already in an IVA and paying such large contributions. The judge could refuse the order and then you are back to square one.
In my experience, issues like this can often be resolved by sensible ongoing dialogue and compromise on both sides. Do let us know how you get on.
Did you find out the reasons why EGG refused unless 100p in the pound?
Ask your IP what reasons they gave.
This seems a bit of bluster and hissing that went on to get your IVA approved.
Post us here all you debt details and let us comment and hopefully suggest a solution to your problem
Last edited by David Mond on Wed Nov 05, 2008 12:40 am, edited 1 time in total.
Regards, David Mond, Insolvency Practitioner for over 46 years. Personal Insolvency Practitioner of the year 2012, Personal Insolvency Practitioner of the year finalist 2013 & 2014 awarded by Insolvency & Rescue Magazine and 2015 finalist for Personal Insolvency Firm of the Year.
