www.iva.co.uk

Hi,

My first six month review is due next month and I am a bit concerned...

When I started my IVA in June I was in a job earning £15,250 and paying back £264 a month.

I started a new job in September earning approx £27,000 and I am being paid on a weekly basis - average weekly take home between £300-450 depending on how many hours I work that week.

I informed my IVA company of this and they said that I should save a portion of the extra money to put into the IVA after the upcoming review.

I have moved back to my girlfriend's Mum and Dad's and pay £500 rent a month (I was paying the same back at the property we moved from).

Unfortunately I have been unable to do this with moving house and having to pay two lots of rent as well as the upcoming Christmas so i am wondering if anyone has any idea on how much extra my IVA payment will be after the review?

I'm sorry of the question is a bit mish-mashed, I'm just a bit concerned that they will end up changing my IVA monthly payment to something like £800 a month...

Any help would be much appreciated.

Thank you.

A lot depends on your IP and whatever modifications were proposed at your meeting. However, £15,250 nets approx £1020 per month and £27,000 nets approx £1700. If you are required to pay 50% over the first £100 additional income you should be saving £290 per month towards your review. If there are short term problems you must inform your IP about these to ensure you do not commit a breach. For example your IP will want to know why you left one place to move into another when the lease was not up on the first property?

Personally, I feel that the fairest way to deal with this is for your IP to completely reassess your case to establish exactly what your current disposable income is - especially given that there is such as short period between you entering into the IVA and finding a far better paid job. Did you know about the new job when your IVA was accepted?

No I didn't Melanie, I kept cursing that this all happened approx 2 months after I'd entered the IVA!!!

I did call my administrator yesterday and advise them that I have no savings - they said that they will call me next month to discuss.

I'm just concerned that they could put my monthly payments up so high that in reality I now earn enough to make the payments back on my loans and credit cards directly to my creditors (unfortunately the arrears have nearly doubled the amount I borrowed!) so the 'debt free in 5 years' still appeals to me as opposed to making payments for longer than that.

Again, i'm sorry if this does not make much sense - so much going on with moving, Xmas and debt!!!

Thanks for your time.

I'm really confused

In reading between the lines you appear to fear paying extra as you have now a much higher income.As you salary has risen substantially, your IP might as well ask you to do a new I/E and decide how much you can afford.I suppose that unless your I/E goes up by double you would be expected to pay alot more now.

Get the debts paid off as quickly as you can, and then put this behind you. Unfortunately you will also pay the IP's cost, but there will be a saving on interest charges which may be a similar level, and at least you have the benefit of a structured repayment whilst you enjoy your new job without the worry of creditors chasing you.

Thank you for your replies.

That's what I am happy to do - it may seem like a stupid question but the more I pay into the IVA will my debt get paid off quicker (and therefore I will be able to get credit/mortgage earlier) or will I be in this for 5 years regardless?

You will only ever pay back 100% of what you owed plus the costs. If you pay more in, you may be able to pay all of what you owe in less than 5 years, in which case your IVA will be finished.

Your credit record will still be shot for 6 years though.

Right, that makes sense - so for arguments sake I could pay all my debts off early then save for a property for the rest of the 2 years i am not paying the IVA until my credit record has cleared up?

As long as you are comfortable with increasing your payments then do so.
We have some big overtime opportunities coming up and I intend chucking the whole lot in. You dont know what may come up in the future- the more you have paid the better your chance may be of a full and final at some point or even paying off early

I presume so.

Thank you very much for all your help.