www.iva.co.uk

Hi

I posted a while back about our payments getting tight. Well, like everyone else, everything has gotten tighter. My partner was made redundant in June, (when started a new job - directors had been v illegal etc) Anyway, he is now in a temp job, earning £220 a week, I finished maternity leave and couldn't go back to full time hours, so was in short pushed out by them. I have tried to get part time jobs since then, but nothing is coming up. So we are getting £227 every 2 weeks for housing benefit (As we are renting) £71 a week for tax credits and 75 for child benefit.

So our total income is 1713 per month and outgoings are 1545 leaving £168 for petrol and food, with petrol prices so high, we're struggling on £120 a month for petrol, leaving us with only £12 a week for food/clothes and anything extra. It's just gotten too much now, and we really don't want to go down the bankruptcy route, but it's being pushed upon us rapidly. Our IVA is due to finish March 2012 - and there is no way we can carry on like this until then. The problem being we have this 24 month clause in place saying we can't modify until then, and I'm sure (please forgive me if wrong) that if we do try to modify we would have to pay more money to do so, is this right? Can anyone suggest anything to help. It's our little boys 1st birthday soon, and we can't even afford a weekly shop let alone even some little things for his birthday, or even saving up for bigger things like M.O.T. tax etc, all due in January.

Our rent is 775
Council Tax - 113

ps our IVA is currently £350 p.m

Hi

Sorry to hear that your situation has taken such a bad turn for the worse. It never rains but it pours.

Is the £220 per week your partner receives before or after tax? What are your other outgoings apart from utilities - do you have a car on HP?

From what you say, you cannot afford to pay into the IVA at the moement and should speak to your Supervisor imeediately. It may be possible, in light of the emergency situation you are in, for him or her to return to your creditors and ask them to agree to a payment break while you and your partner find suitable employment.

Hi
It's 220 p/w after tax - so around 880 a month for a 4 week month
The problem we seem to be coming across is with childcare costs we cannot afford for me to go back to work full time at all, and any part time work, we then lose out on tax credits and housing benefit, so dont end up any better off.
A payment break is an option, but we really don't think it's going to be the solution in the current climate, permanent jobs are so far and few between at the moment.
Is this 24 month rule one that has to be abided to completely, or is there any leeway? Would we have to pay loads extra if this was possibly changed?

yes recently changed shifts i now earn a lot less i used to take home over 1,400 pounds i now take home 1,282 so my ip is looking to cut my payments form 450 pcm to 390 pcm hope my creditors accept this

It should not cost you anything for the Supervisor of your IVA to return to your creditors and ask them to accept a reduced payment. His or her costs for doing so should be a cost of the IVA. However you will need to check your proposals to be sure.

There are differing views as to whether or not a variation meeting can be called when there is a 24 month rule. What can be done will depend on the exact wording of the clause. I am sure though that the Supervisor of your IVA will do everything he or she can to help you.

A payment break if agreed by your creditors would have to be for a set period only - say three to six months. If your partner is unable to find better paid work in this time, then you will have to revisit the possibility of petitioning for your respective bankruptcies.

I think I've just found the bit I was dreading -in our proposals - it says 5.7 If the Supervisor calls a variation meeting an additional fee of £500 + VAT will be charged...I guess that's the bit we didn't want to here.
Does anyone know if we would have to find the money to pay that up front? Or would it be added onto the IVA? Also, if we went for the variation to lower payments, and it then was refused, would we automatically fail, or would it continue as is for the time being? Also me and my partner jointly pay the £350 each month, but it's classed as 2 IVA's - therefore would it be 2 of these fee's?

It does not matter if the original clause in the proposal states "no variation for 24 months" or something similar. If circumstances have changed and there are proper reasons then your Supervisor should and will submit a Variation to creditors - if he/she won't let me know!

One or two people on here have mentioned about paying for a variation meeting. Their fees were added to the end of the IVA.

Thanks both for your responses - as for the other question about if the variation fails - do we instantly then fail and have to go for bankruptcy, or would it carry on as it has until we then opt to change it?

Thanks in advance

In all variations that we do the nominal charge we make comes out of the pot that is available. The variation may extend the arrangement (to cover a similar dividend promised) or only to give a lesser dividend. Depends on all relevant circumstances.

I have very rarely ever asked a client to fund the cost of a variation meeting, and creditors are either happy to pay for the cost or not. That's life and a good IP would never refuse you the opportunity to vary just because they may not get paid.

The "no variations in 24 months" clause is a joke - and that is accepted by the authors of it in today's tight economic climate. I have seen several IVAs varied within this period, as at the end of the day creditors would rather agree to that than see their cumstomers forced into bankruptcy.

You should compile a new listing of income and expenditure to present to your IP to see if they feel that the revised payments will represent a still viable option for your creditors. If this is not eventually accepted by creditors, there will be other options such as a DMP or even bankruptcy proceedings which they can help you with.

Ok, think I will have to contact them tomorrow and see what is said.
Just noted a few other bits from proposal.
5.10 - If my partner and I are declared bankrupt, the Official Receiver immediately becomes entitled to an Administration Fee of £1,625 for each bankruptcy.
What does this mean exactly?

It means that the Official Receiver is entitled to charge an Administration fee of £1,625 - it is actually £1,710 these days, but this can only be drawn if there are assets available to do so.

Oh right ok, so it's not something we specifically pay out extra. I was getting worried then, if, and it's a big if, we have to go down the BR route, I assume we will just pay the courts fee's and then any payments we can afford from I&E form, that is over and above the 99 pounds mark.