www.iva.co.uk

My wife and I are in an IVA which is not working for us. We have been to the Citizen's Advice Bureau and are starting proceedings for bankruptcy. We were advised to get the IVA annulled, but I can't find any information on how to do this.

Any help would be gratefully received.

Regards,

Hi Ben, I'm sorry to hear your iva didn't work out. Do you mind me asking what went wrong? I'm not sure under what circumstances an iva can be annulled so hopefully one of our professionals will be along with some advice. You can fail the iva by missing 3 payments usually...but doesn't for some advice as I'd hate to see you fail if an anulment is possible. x

Hi and welcome to the forum.

Why is your IVA not working? Is there a particular reason?

You can ask your IP if they will fail the IVA now or you can stop making payments - if you do this it will allow you to save up the bankruptcy fees.

An IVA cannot be annulled. Surely a debt advisor from the CAB did not advise you this could be done? If you do not wish to continue with the IVA, then ask your Supervisor to call a termination meeting, but you agreeing to waive your right to a Notice of Breach. The meeting is likely to resolve that the IVA be terminated, and you can then get a Certificate of Termination to support your application for bankruptcy.

Thanks to all who have replied.

The CAB advisor did say we would have to get the IVA annulled, but he was not sure how long it would take. I was simply told we had to write to the IP telling them this is what we wanted to do. What I need to know now, in light of your responses, is this: Are the repercussions of simply not paying the IVA for 3 months more severe than calling a termination meeting? The non-payment would certainly help to raise the funds to file for bankruptcy.

With regard to why the IVA is not working: I am in a commission paid job and since setting up the IVA, my take home pay has, on average, been lower. In addition, when my pay is considerably lower, we fall behind with things like council tax and water etc...

We both feel like we're in a downward spiral and we will have to go BR eventually, so the sooner we do it, the sooner we can get on with rebuilding our lives.

It's not annulled, as Mel says. It will have to fail. Makes no difference whether you ask the IP to fail it now or just miss the payments for three months.

The BR fees are currently £700 per person so it would make sense to stop paying and save those payments up.

Either phone your IP or email them to tell them what you want to do or simply stop making the payments.

Sorry it has come to this but BR does seem like a good solution for you.

Hey Ben.yg i hope things work out for you and your wife.

I know things are pretty tough at the moment but keep plugging away and im sure things will improve for you both.
Best of luck

Baldy & Family

How much are you currently paying into the IVA and how much do you feel you can realistically afford?

Hi Mel,

We're currently paying £324pcm, but our usual payment is £371. We're on a slight reduction following a conversation with our IP as we cannot afford to pay that much. I think the biggest problem is that when we did our initial income and expenditure, we were advised how much they could get away with putting forward to our creditors. In reality, our cost of living is considerably higher, and not because we live a life of luxury, it's quite the opposite in fact.

Looking at our situation, we would probably struggle to pay even half of what we're supposed to. The thing that annoys me is that looking around on various forums, this seems to be a fairly common occurrence (correct me if I'm wrong).

In addition, I have heard it mentioned by various people that an IVA is not best suited to someone in negative equity on a property, which we are (mortgage is £94k, property worth about £80-85k)

Regards,
Ben

Hi Ben, I hope you can sort things out and BR does sound like it's worth serious consideration. I wouldn't conflate the appropriateness of an iva with the question of negative equity as the two are quite separate. I have an iva and no property yet i felt it was the most appropriate solution for me. Negative equity only becomes a problem when you want to sell, if you are happy in your home and want to keep it then an iva removes the risk of losing it.

Ben.yg - the main regardless what decision you make you need to find out all about your options including Bankruptcy (ie. are you aware that you could have a payment order issued for 3 years - any income disposable income over £20 - may be taken and they may hold on to your house for a few years to see if this increases in value) you credit rating will be shot for a further 6 years. These and more are a few issues in Bankruptcy.

You have of course got to make the right decision for yourselves - just ensure its an informed decision !!.

Actually ginger, if you have DI over £20 then all of it is taken, you're not even left with the £20.

Kallis - thats what i meant - its Monday so not awake yet

Know that feeling well!!

Our IVA recently went pearshaped as we were really struggling to keep up the payments.

We don't own a property so negative equity etc didn't come into it, but all we did was phone our IVA company, tell them we couldn't keep up the repayments and that was that. We just stopped paying and a while later our termination certificate came through.


As others have said, most IVAs automatically fail if three payments are missed.

If I were able to go back to when we started our IVA I would have chosen bankruptcy instead.