Hi There. I'm wondering what happens now my circumstances have changed

[Karl.t]

Hi There.

I'm wondering if anyone can shed some light on my situation for me.

My circumstances have just changed drastically. Until recently my monthly income total has been £494.

I was getting £269 Carers allowance
And £225 from a part time job.

My expenditure amounted to £404

And my IVA payment is £90

However after been a carer for the past 18 months I have finally been able to get a full time job My issue is, my pay will increase significantly as well as my expenditure.

Will i have to pay every single penny extra a make into my IVA?

For instance i think my take home wage will be around £1000 after tax per month. My expenditure around 700 will i have to pay all the £300 into my IVA? If so why would anyone be motivated to get a better job if after all there hard work they will be no better off?

It state in my contracts

"7.5 I must report any overtime, bonus, commission or similar to the Supervisors if not included in the original surplus calculation within 14 days of receipt and where the sum exceeds 10% of my take home pay 50% of the amount (over and above 10%) shall then be paid to the Supervisors within 14 days of the disclosure. Failure to disclose any exceptional overtime, bonus, commission or similar by myself will be considered a breach of the Arrangement and the Supervisors shall notify the creditors in the next annual report with proposals for how the breach is to be rectified."

The IVA is with Harrington Brookes (one advice)

I'm sorry this seems to be a popular question in the forum but i am really struggling to find a definitive answer.

Also i have around £11000 of debt in the iva plus fees and im 6 months in.

Any help would be fantastic as i'm struggling to get in touch with my IP due to the new opening times of the company which are exactly the times i work.

Thanks in advance.

Karl

[lifenoteasy]

It's likely you will end up paying more but you will only know the amount once a new assessment is done.

An iva is designed to ensure that you do see some of the benefits of an income increase but at the same time it is also designed to ensure that your creditors get more back if possible.

[Adam Davies]

Hi

Inform your IP and they will ask you to fill out a fresh income and expenditure form, your new surplus may be your new monthly payment, however some IVAs are worded that only 50% of any extra surplus has to be paid into the IVA.
You may find that you are able to repay your whole original debt plus IP fees and conclude your IVA before the five year end date

Regards

[Lisa Thomas]

Hi your IP will reassess your I&E and you will get to keep 55% of the net increase and pay 45% into the IVA pot.

You might then possibly use the extra monies to save up and (depending on the figures involved) make an F&F offer to settle your IVA early...

[MrsR]

Hi there,

An IVA is about wanting to repay what a person owes, and doing so is about using the disposable income available to enable this.

With regards to motivation, I guess it comes down to morals at the end of the day, as to whether a person chooses to not work and pay the bare minimum into an IVA, or gets a job where they can afford to repay more towards their debt.

With regards to overtime etc, our IP had the 'debtor keeps 10%, then the remainder was split 50%/50% between the debtor and the IVA pot.'This was an incentive to us as it meant that the extra money we kept paid for Christmas, birthdays and any emergencies that came up. This should always be communicated to the IP asap and paid over within 14 days as instructed.

At the end of the day, if you created the level of debt, you will owe it until you deal with it one way or another, and I personally felt good knowing that every month that passed, I was paying what I could afford to pay this off, especially as it meant that I kept my family's home.

[lifenoteasy]

Sorry MrsR but that isn't the way that the IVA industry views it.

Here is the headline from an email received at the weekend from a company called Faith Financial Solutions:

"An alternative new plan to get you out of credit card debt.

Reduce your debt repayments by up to 75%.

No upfront fees."

They continue further by saying that they reduce the amount you pay rather than focussing on the stuff that would ensure that people get a balanced view.

Additionally the mailshot came from a US address which a lot of the IVA companies are doing - I'm assuming to try and pass the buck if someone complains that they haven't been getting consent to contact people who have opted out of mailing lists.

[kallis3]

Hi,

You won't have to pay across all of your extra earnings but will need to do a new I&E to sort the payments out,

[MrsR]

No wonder people keep asking if they've been miss old IVAs when they receive info like that and then pay the 100%+ back!

Shocking is not the word

[Lisa Thomas]

Not defending FFS but it does say 'by up to' in the quote and often this can be true.

[kallis3]

Also, if you can pay back your creditors in full then brilliant.

[lifenoteasy]

Also, if you can pay back your creditors in full then brilliant. - See more at: http://www.iva.co.uk/forum/topic.asp?wh ... 464#607187

If creditors wanted that situation they would manage debt situations inhouse.

Use of an intermediary allows them to sell on the debt, declare a loss to be offset against tax etc.

IVA company fees and anything linked to PPI would also not be going up.

[kallis3]

Is that the right link? It brings you back to this page.

[lifenoteasy]

Sorry - I should have put the whole quote in speech marks.