this is too much for me to pay. What should I do?

[Vickilou28]

Hi there, I have recently just had an IVA accepted and have been working with a company called Haines Watts. When they initially wrote to me with a breakdown of my expenditure and a 'quote' for the monthly payments, they came up with a cost of £272.00 p/month. This to me was affoirdable so I signed the paperwork, set up my standing order and waited. Then they asked me to raise the payments to £325.00 which was still fairly comfortable, so again I signed the papers and changed my standing order amount. By the time the creditors meeting had arrived, my creditors would not agree to accept the IVA unless I was prepared topay £400.00 per month. I told Haines Watts that this was beyond what I could afford but the creditors would not budge. I panicked and agreed to pay that amount. I have spent so much time and put in so much hard work to try and sort out my situation and I didnt want to go bankrupt. I havent yet made my first payment - I'm wondering if I should tell Haines Watts that this is too much for me to pay. What should I do?

[MelanieGiles]

Hi vicki and welcome to the forum

That is such a material jump from £272 to £400 that both you and your IP ought to have known it was unaffordable at the time of the creditors meeting. Where on earth was this increase going to be funded from?

I appreciate that you felt that there was only one way out, and have now had time to reflect appropriately - and you should seriously consider whether an IVA is worth an ongoing financial struggle for the next 5 years, when it was the very thing that was supposed to take you away from that.

You must discuss your concerns with the IP immediately. If IPs have doen their job properly, there should be none, or only minor adjustments. The fact that so many people are being pushed into unfairly high monthly contributions, indicates that creditors feel this work is not being done properly and whilst debtors continue to accept these increases it sort of proves the creditors point.

Do you own a property? If not, then it seems that bankruptcy proceedings might be an appropriate way forward for you. Discuss this again with your IP before you finally decide.


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

[jamesfalla]

Hi Vicki

Unfortunately this is a situation in which all to many people find themselves. You are so desperate to get the IVA done and the creditors off your back, that in the heat of the moment, you agree to payments that you can not afford.

You are Not the only person to have done this by the way!

Unfortunately, it is very unlikely that your IP will be able to get your creditors to reduce the payments you make at this late stage.

I ask the same question as Melanie. Do you have a property? If not, then it may be a very sensible option to consider bankruptcy. Do not feel a failure. Think of it that you have given the IVA the best chance you can but it is the creditors themselves who have chosen to reject your offer. As such, you can now feel better about the bankruptcy option

James Falla

Expert in IVA, Bankruptcy and informal Debt Management solutions for over 10 years.

For more information visit www.jamesfalla.com and visit my blog at: http://jamesfalla.blogs.iva.co.uk

[coco]

Hi Vicky,

I too was in a similar situation and the same as you paniced and agreed, now four months into the IVA we have failed as it is almost impossible to contiue with. We are in court tomorrow with BR, my advice if you know your not going to be able to maintain the payments then think about the option of BR as 5 years is a long time. Had i done this in the begining i would not have paid an IVA company nearly 4000k, I too own a house and car and facing the prospect of loosing both and the strain of all this cost my marriage and had an impact of my childrens lives.

I understand where you are coming from being at a vulnerable situation at that time.






(I apologise for my keyboards poor spelling and grammar)
http://coco.blogs.iva.co.uk

[freelili]

Coco

I wish the best of luck for tomorrow with the BR. I am so sorry about your situation, I am sending you a virtual hug and hope that you will re build your life from tomorrow. The sun will shine again for you I am sure.

Extra special wishes

LILY

I asked God for a solution and have to live with his reply.

[Skippy]

Good luck from me as well Coco xxx

Onwards and upwards!!!

[aguise]

All the very best from me also coco x

Ang

[scaredkez]

coco
all the best from me also, hoping to do it myself in the next few weeks, news the CAb man gave me today that from the 1st of april this year the OR can let you stay in your property for up to 3 years i had read this before, but it will put a bit of pressure off you rushing to find a home, another bit of news he said that lloyds will never take any court action against you ever don;t know how true that is for anyone ever had dealings with him he was at a conference last week where all these things were lectured on by the OR man from liverpool who he said is very nice and this is who i will be dealing with.
kerri

Please view my blog at: http://scaredkez.blogs.iva.co.uk/

[Vickilou28]

Hi Melanie,

Thanks for your reply - I don't own a property-I live with my parents. I do have a car which is about £6,500 in value. I dont want to lose this, however I understand that if I do consider bankruptcy then I will lose it. What else can they take from me? I'm worried they will take things like clothing and cd's etc. Would it affect my parents in any way? I felt I was pushed into agreeing the £400.00 per month figure and no matter how much i tried to get my IP to negotiate with my creditors they wouldnt have any of it. It was almost like they didnt believe me when I said I wouldnt really be able to afford the payments but felt I had no other option.

Thanks again for your reply

Vicki

[freelili]

Hi Vicki

Just to say that OR will not take CD's, clothing or anything like that. The debt is yours and really nothing to do with your parents. Dont worry about this as it just does not happen. Only your things worth thousands of pounds will be of interest to them. You would be given replacement funds to buy a cheaper car if its needed for work etc. I know that BR is a scary decision but there is no sense in agreeing to a fee you cannot afford and for 5 years? Your creditors will get nothing in BR so they would be shooting themselves in the foot if they do not accept your affordable offer.

I hope this helps
Good luck

LILY

I asked God for a solution and have to live with his reply.

[David N]

Sorry to have to read the above - again makes me feel the ambulance chasers are in it for themselves, alone (not including you Melanie) they have big advertising bills to pay, currently pay £75 per internet lead for debt management!
They know they'll probably never write 75% off even though technically it might be possible but they act like direct sales force estate agents, tell you your house is worth £20k more than it is just to get your instructions and then advise you to take the lower offers they do actually get - doesn't matter to them though, they still get thier 1% 2% or even 3% if you lool at some firms - Foxtons are selling up, so the Telegraph says.
Ans so too with direct sales IP's tempt you with £272, raise it to £325 half hoping they'll get agreement but by the time credit meet comes along they have already been told what will not be accepted!
You get to pay £400 per month and they still get thier fee! No wonder the BBA are counselling against IVA's - the ambulance IP's were just taking the pi** with derisory offers and now, like bank charges, the creditors are biting back, sorry.
Opinionated David N

[MelanieGiles]

Thanks David N!

Vicky - your car would probably be at risk under bankruptcy proceedings, but the Trustee will allow you up to £3,500 to find a replacement vehicle. Are there any family members who could offer say £3,000 to enable you to keep the car?

Also your personal possessions would be absolutely safe, so worry no longer about your CD collection.

I share David's concerns about people being pushed into unfair monthly repayments. Sadly this forum is full of people who have fallen victim to a system that is supposed to return money to creditors, but often seems to work at cross purposes.

You must do the best thing for your future, and whilst bankruptcy might be a little painful, you will quickly recover and move forward into the future without financial worries.

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

[neverending]

Vicki
strange one
You state that you have not as yet made a payment so your IP will get nothing if you do not start your IVA,can you confirm this ?