I have now completed the first 5 years of an IVA. As I was unable to release equity at the end of 5 years, the IVA was extended by a further 12 payments.
I have now asked the same question to my IP three times, and failed to obtain any answer at all.
My question is very simple: Is the extension to my IVA for only 12 payments, or is it for 12 months with one additional payment each month?
The reason for asking the question is simple: if I am required to make 12 additional payments, is it possible for me to end the IVA earlier than 6 years if it is possible to make payments faster than 1 per month (for example by borrowing from a relative who is willing to help me to clear the IVA). I find it incomprehensible why the IP cannot provide a simple answer after having been asked three times. I can't afford the cost of a lawyer to give me a definitive answer.
The extension is for 12 payments at monthly intervals --- if you could afford to make, say, two payments a month, that would indicate that your monthly income surplus (disposable income) was, in fact, the equivalent of two payments and so the "monthly amount" should be increased anyway. In other words the agreement is to pay over your monthly surplus over an agreed amount of time. The fact that the source of the "surplus", in your case, would be by borrowing could see the IVA actually fail --- you are not allowed to borrow during your IVA.
You could shorten the period by agreeing with creditors to make the 12 payments in one lump sum in the form of a "Full and Final Offer" --- however, this takes a few months to arrange so you would have to be quick off the mark to get this through. The funds for this would have to come from a third party (and will be checked).
At this stage, however, there is very little to gain from finishing early --- your credit files will still be shot for the full 6 years and the hoops and hassles of arranging a fast F&F will probably outweigh any sense of relief or freedom at getting out early.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
I agree with Foggy - best let it run it's course now.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
Thank you Foggy and kallis3 for your thoughts on the matter - they help my understanding a lot.
The basic answer to my question is summed up by one of Foggy's comments: "The extension is for 12 payments at monthly intervals". I can now see the pitfalls of trying to speed things up to gain an earlier 'freedom'. I am not particularly concerned that the credit record will remain 'shot' for some time. The IVA has proved to be a very valuable exercise in living without borrowing - effective credit detoxification! If people learned to live without credit cards etc., many financial institutions would be in big trouble and the government would be unable to rely on increased credit to bolster the economy. When my IVA is finished I will avoid credit cards like the plague having learnt to live without them.
GD.23 wrote:Thank you Foggy and kallis3 for your thoughts on the matter - they help my understanding a lot.
The basic answer to my question is summed up by one of Foggy's comments: "The extension is for 12 payments at monthly intervals". I can now see the pitfalls of trying to speed things up to gain an earlier 'freedom'. I am not particularly concerned that the credit record will remain 'shot' for some time. The IVA has proved to be a very valuable exercise in living without borrowing - effective credit detoxification! If people learned to live without credit cards etc., many financial institutions would be in big trouble and the government would be unable to rely on increased credit to bolster the economy. When my IVA is finished I will avoid credit cards like the plague having learnt to live without them.
You are welcome. I completely agree (and often harp on about) regarding the rehabilitation aspect of an IVA and the reconnection with "real money" as opposed to a reliance on "magic plastic". I am approaching 6 years post IVA and I do have a couple of credit cards now, but with zero balances. It took a while and much wailing and gnashing of teeth but I do use them for big purchases (with the cash in the bank to pay them off right away) because of the extra protection they provide if anything goes awry with the goods purchased. They are also a useful insurance policy whilst out and about in emergencies. But, these days, my "borrowing" (short term as it is) never exceeds my ability to pay it back right away.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
