I'm just about to pay the last payment on a 72 month IVA when Creditfix come along and tell me that I have to pay an additional year due to the equity clause in my IVA which is fair enough but my first point is, they are 6 months late in getting round to dealing with this. Their excuse for the lateness is still that of a backlog from taking over the PGJ cases which is over a year ago now. Now if I were to be 6 months late on dealing with something for them, then I am sure there would be consequences.
Now on the the real issue. Between April and August this year, I lost around £300 per month in Tax Credits and Child Benefit when my eldest turned 18. I contacted Creditfix back then who reduced my payment by £30 per month and said that we could keep any uplift. Now this still leaves us down by around £150 per month plus we have lost the extra monies we used to have as all the overtime is having to go into the pot. I asked if they could refer this to my creditors at that time and they said could we manage to continue to pay until December when the final review would be, so we struggled on and did that.
Now, there has been deemed to be equity in the property based on the drive by valuation, they are saying we have to pay for another year or I need to get a large sum of money from somewhere for a full and final which isn't going to happen.
I asked if they could refer to my creditors and ask for closure of the IVA as we can now no longer afford it (bear in mind we have paid 6 years). The reply they have come back with is that if they were to do this, there is a very strong chance that the creditors will make us sell the property as there is so say equity in it, although if we did sell it all the equity would likely be eaten up in fees.
So my question to the IPs on the panel is, how realistic is this?
We are literally back at the point we were at at the start with no money for anything apart from the essentials and I can't see us going on for another year like that, we are basically insolvent again!
I would be grateful for your opinions.
Thanks.
7 year IVA completed in December 2016 - there is light at the end of that tunnel
With the valuation, don't take a drive by one as gospel. Arrange a couple of your own so you can get a proper value and then speak to them again. It's not unknown for creditors to force a sale but it's unusual, and, as you say, they will probably get nothing and you won't have a home!!
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
I think you are entitled to ask for the IVA to end and if creditors reject this your IVA just continues on. You would not be obliged to sell your house but you would have to struggle to continue with the payments.
However creditors are usually sympathetic especially when you have paid for six years so a new I&E seems appropriate to me. A variation should have been called when you requested it and a backlog is no excuse. Tell CF you want a variation put forward asking for a closedown or a serious reduction in payments given that you have had to do substantial overtime just to maintain payments.
Out of curiosity. What is the value of the property, the outstanding mortgage and is there one IVA or two?
I agree with Michael. In addition it might still be worth getting your own valuation. If you can challenge the equity figure then the extension won't apply.
