My wife and I had an IVA agreed about two years ago, monthly payments were agreed, and a term of five years was approved.
About a year ago, my wife went from part time to full time work. As a consequence we were asked to increase our contributions, the majority of which I had to bare.
Three months ago we were served with an eviction notice (2 months) on which we were paying very cheap rent for the area. We found it impossible to find a suitable property at the same rate and are now paying an extra £170.00 extra a month. In addition we have extra child care costs, since my wifes working full time, and general increases in weekly allowance, which we work round.
We had our review last week, and based on the updated information we supplied it was evidant that we are now paying a bit more than we could afford.
Despite this we've been told that we would need to hold a creditors meeting to get the payments adusted, this is in spite of the fact that for the last year we have both been paying more than the amount originally agreed.
Would it not be possible to have something closer to our original rate of contribution agreed without having to have a creditors meeting, after all this wasn't required when the rate was increased, surely this is all a bit one sided?
You should only now agree to pay something that you can afford. What do you feel your disposable income figure is now compared to your contractual IVA payment?
Hi Melanie. Since our change in circumstances and last years adjustment there's a difference of around £250 more that we are having to find. The original proposal was just manageable, but we have had a 25 pounds a month increase in Council tax, £180 in rent and around £50 more in child care and house hold. Our IVA firm insists we can only get a reduction down to pre approved levels if we have a creditors meeting, which seems a bit unfair.
You have to be realistic - if you could originally afford only £500 and now you can only afford £250 must be taken into consideration when considering where you are right now.
I may have confused things. My wife and I began by paying around £850 monthly in a joint plan. This was based on her part time salery, my full time and the circumstances of the time.
When her salery went full time this went up to over a thousand a month. The extra benefit we derived from the full time salery was largely impacted by increased child care (mostly after school and holidays.
The move to increased rent and council tax has now completely wiped out any give that was there before. We've really felt it this month, and were hoping the review and our submission of revised outgoings would mean that our contribution would be adjusted to fit. Were about £250 a month short of where we need to be. Even if we had an adustment set somewhere between our original agreement and what were paying now, would be a help.
It just seems that when circumstances suit our creditors then contributions go up. But if our circumstances change impacting the benefit of this increase then a creditors meeting has to be held, despite our current contributions being over and above the agreed levels of the original approval. This seems a bit unworkable and lacking in good will, despite the fact that we have not missed a payment in two years.
Sounds complicated, and fully understand how tough that's going to be feeling. I guess there's no way round the need for a creditors meeting, probably not too much of an issue if it's convened quickly and reaches an agreeable conclusion. The scenario you describe doesn't sound like something creditors wouldn't have sympathy with, and it's in their interest to ensure payments are manageable, so that the IVA succeeds and they get their maximum return.
I'd suggest sticking to your guns and as Melanie said, being clear about exactly what you can afford to pay based on disposeable income, taking into consideration all of your new circumstances, not just increased income.
I thought that if your payments had increased there was no need to call a creditors' meeting to reduce them back to the original levels. It seems a complete waste of time to have to do that.
Have you spoken to your IP, or to a member of his/her staff?
Skippy13 wrote:
I thought that if your payments had increased there was no need to call a creditors' meeting to reduce them back to the original levels. It seems a complete waste of time to have to do that.
Have you spoken to your IP, or to a member of his/her staff?
We have on two occasions, it seems contributions can be raised if our circumstances improve but not reduce even to levels above the original agreement if circumstances move against us at a later time without the need for a creditors meeting. This to me seems to lack good will at best, and inflexible at worst.
I'm concerned also our creditors would insist on an extension based on our current contribution, just so that they can maximise their return. If this was the case we would definately go bankrupt. Is there any further advice I can get on this before I approach my IP?
Last edited by johnt on Sun Jul 19, 2009 11:55 am, edited 1 time in total.
Hopefully Mel, Andy or Michael will be on later and be able to confirm, but as far as I'm concerned if you are meeting the payments set out in your proposal they should be reduced without the need for a creditors' meeting.
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.
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Hi
Sounds as if you are geeting the wrong info from your IVA provider. As Melanie states your IP can reduce payments back down as far as the original payment afreed at your initial creditors meeting.
You need to ensure that you speak with your actual Insolvency Practitioner
Regards
