Me & My wife are in IVA with payplan. Mine started Jan 14 & my wife's started in April 2012 and she has done her last I&E review in April this year ( If they do not ask for additional year ) .
We have only 1 child and recently he has been diagnosed with Autism. We applied for DLA & given only care component. DLA also meant that there is an increase in Tax Credits.
Now coming to main question. How to approach Payplan on this? Previously we have been just about managing to make IVA payments. Even though we were struggling with that budget because we didnt want to fail the IVA so we kept it floating. Many times we had to cut expenses from here & there or even ask family to make that happen.
Now some money is coming for our child. How to sort this out?
Will they raise any objection on why there is an increase in some house keeping expenses?
What sort of expenses are allowed for DLA? Previously we were just about doing it normally but now after knowing that our child is suffering so obviously will have to give him better & healthy life. So what sort of expenses we can use for DLA.
What are the guidelines for general expenses? Previously we kept them to minimum. & honestly speaking many times was short to make IVA payments but managed as didnt wanted to go in Bankruptcy.
Now stressing out that if we raise these expenses to the actual level or where we are ok, then they might say previously you were spending this much so why increased now?
Unfortunately you are with Payplan, who tend to do things differently from all the other firms and include as much income from the household in the IVA payment as possible.
Most firms simply cancel out the DLA income with a general expense so you get to use it for what it is intended -- I cannot say that Payplan will look at it this way (that is not to say they won't).
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
@Foggy, thank you for your reply. That is strange. Our experience so far is ok with them.
You mentioned that "most firms simply cancel out dla income with a general expense". How is that done? Dont they need list of expenses like normal I&E?
Hi Mark. Don't get me wrong. Payplan handle many, many cases very well -- we get relatively few complaints concerning them, but they do things a little differently than most to maximise creditor return. For instance they tend to work on household income, rather than that of the debtor alone, to arrive at a repayment. This often means that, effectively, a solvent spouse and working children can be repaying the insolvent partner's debts. Of course, many circumstances are that both partners are in interlocking IVA's so this wouldn't always be an issue. Also, due to their workload and IP / client ratios the IP has very little input and the running of the arrangements are left largely to admin staff, so approaches vary within the firm itself as well.
Regarding DLA, different firms use different methods. Hopefully one of our insolvency professionals can comment further.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
I had no problems with Payplan but hubby was also in a separate IVA (not interlocking) and as well as his private pension he had DLA which was taken into account. The only thing they didn't touch was the mobility part and we were allowed to use that for a motability car.
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
@Foggy: yes that is true. I have also noticed that IP is not that much involved. mostly things are decided by Case Supervisors.
Yes will wait for some specific information by insolvency professionals on this post.
@Kallis3: we only receiving care. And its for a 6 years old child so shouldnt it be different? want to prepare for myself before contacting them. and know how to approach and what to include as expenses.
My husbands initial DLA was for ill health but it was used as income for his IVA. Payplan do work to their own rules but all you can do is tell them what is happening.
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
We list DLA as an income and then immediately remove it as an expense. This money funds the additional costs of having a disability and regardless the money is for the benefit of the child and not your creditors.
If you receive a carer's allowance this could be treated as income but again if you use some or all of this money then let your IP know. We have clients who use the carer's allowance to pay for someone to look after the child while they go shopping for example and this is usually perfectly allowable.
@Micheal: Thank you for your reply. Very helpful. We dont receive carer allowance. Only care component of DLA.
So basically we dont need a breakdown for DLA expenses? Or if w increase our expenses, wont they say that we were managing in less before and why there is an increase?
We would not ask for a breakdown as it is irrelevant but I cannot speak for Payplan. However if they do ask for a breakdown there are a number of items which would exceed guideline figures. We have children who have unusual and expensive diets, they have Sky TV with the full package, their clothing allowance is higher due to damage, electricity is higher if there is bedwetting and therefore washer/dryer costs.
The DLA is to help the child and if you want to use that money for swimming, bowling, music lessons or whatever then it is entirely up to you. If Payplan question how you were managing previously advise them that you could not afford these things or that you relied on family help but either way you will not be using any of your child's money for the IVA. Any problems and demand to speak with the IP themselves and let us know how you get on.
