www.iva.co.uk

HI All,

I have been with Harrington Brooks for 2 years. I have never miss a payment. After the first review they tried to increase my payment. But there was no disposal income left because my wife was paying £1000/pm towards her unsecured debt. The reviewer understood the situation and he just asked me to pay the extra 50% of my overtime. But in the second year, this time another reviewer tried to do the same to me increased my payment to £200 more. She was asking my wife to become IVA with out paying £1000 to unsecured debt. I told her this is completely her choice. I can't ask her to do this. My wife is not interested to be in the IVA any way. She said there is no other option I have to pay the £200 extra every month by reducing my outgoing. My new increase payment starting next month. I am in deep trouble now. I don't know how I am going to make the extra £200. No one is Harrington Brooks is helpful. I have asked them 3 or 4 months delay in starting the extra payments. They have refused this straight away. Now one of my friend offered me some money for the full and final settlement of my IVA. I have emailed Harrington brooks about this. No Idea when they are going to come back. Until then I have to raise 200 extra towards my IVA payment. Any suggestion Please. Man y Thanks

If the IVA is in your name only then any increase in payments can only be based on any increase in YOUR salary. Your wife need have no part of the IVA in any way. Was your original disposable income calculated on your salary alone or was your wife's salary included ?

Hi

Does her share of your joint disposable income cover her minimum payments to her creditors ?
How was your disposable income calculated when you proposed your IVA and was your wife's minimum payments factored into your joint expenditure ?

Regards

Your wife must have a large income to be able to afford these payments otherwise your creditors are effectively funding her repayments. I would be interested in answers to Andy's queries above as they are certainly relevant.

The questions regarding your wife's income need to be answered but regarding the variation point I would chase HB if they haven't responded about it within say 2 weeks. Hopefully you made the offer in writing to them? They should then call a meeting of creditors to consider the settlement offer giving a minimum of 2 weeks notice to creditors of the meeting.

Hi All, Thanks for replying,
Yes the original disposable income was calculated including my wife income as well. In the first year the reviewer allocated £800 + towards her unsecured debt. But this year the reviewer only allocated £500+ even though my wife was paying £1000+ on unsecured debt. And asked me to pay the extra 200 every month by reducing monthly out going. My wife's salary is roughly 1900.

Your wife should only be paying her share of the surplus towards her own debts and if she is using some of your money then your creditors would be entitled to object. Therefore if you earn any more than £1900 and are paying less than £1000 towards your IVA then the figures do seem a bit off.

How much do you earn and how much are your IVA payments?

Plus her debt burden appears to be increasing suggesting that there is some over compensating happening.

Thanks Michael,

I am earning 2500 + OT and the IVA payment was 450 now increased to 650. Because I have lots of projects last year and the reviewer calculated my average salary as 2780 for this year payment. That is the reason for the extra payment. I have explained I have not much Over time this year and put my average salary as 2500 and anything above 10% of this they can take the 50% of it.. But they refused it. They want to put my average salary as the same as last year and get the extra 200 from me. Many Thanks

If the money was available last year and you used it they will assume that it is available this year.

I calculate that you have 57% of the income and thus the surplus so your payments shoiuld be over £800 per month leaving just over £600 for your wife. If this is not enough for her to repay her creditors she may also be insolvent and could need an IVA.

I understand this could cause problems and perhaps the I&E breaks down differently but perhaps there is a compromise. If your wife agreed to increase the payments to IVA as and when her debts are repaiud this could be acceptable but if she is not going to be debt free soon [and indeed her creditors seem to be increasing] she should consider some insolvency advice herself.

achus007, I am one of the Insolvency Practitioners at Harrington Brooks. I don't really like to reveal specific figures on a public forum but you have already stated most of them so I will explain how we arrived at the figure of £627 per month currently being requested from you. At the beginning of your IVA, your own earned income was £2,286, your wife's earned income was just £520 per month. There was also rental income of £846 and child benefit of £146, both of which were regarded as joint income. There was no provision made for any separate credit commitments in your wife's name and your monthly contribution was set at £425. At the first annual review, your own income had increased to £2,500 per month and your wife's earned income had increased to £1,936 per month. We allowed her £790 per month for her own commitments, which meant that your payments remained at £425. At the second anniversary your own income was stated at £3,781 and your wife's at £1,900 but you requested an increase in your wife's allowance to £1,000. I do not think it unreasonable that household expenses should be shared in proportion to income and given that your wife's earned income represents roughly 40% of household income I believe she should contribute 40% towards household expenditure, leaving her with £590 for her own credit commitments (remarkably close to Michael's calculation). I have never seen evidence of your wife's credit commitments but would imagine that if she had no such commitments at the start of your IVA then £590 per month ought to be sufficient unless she has accumulated serious debt since that date. Your creditors are unwilling to accept anything less than the proposed £627 per month as they believe that it is fair, and that to accept less would mean that they would be subsidising your wife's creditors. I hope this helps to explain the position.

David

It is not often you get such a thorough response - unfortunately as a consequence I will no longer be contributing to the board as your response confirms that individuals can and will be identified even when they seek anonimity.

It may have been better if you had provided a more generic response and asked the person posting to contact you directly.

Lifenoteasy.
It does seem that David has identified the client but the information on the forum would not lead to anyone else being able to do so. I would be confident their anonymity would still be there but at least there is clarity of the calculations.

My calculations were based on basic enough splits and as I said in my earlier post the actual I&E may indeed differ which is does. I think the calculations from HB are pretty much the way we would have done it and I feel that the poster's creditors would be unfairly treated if his wife retained £1,000 to pay her debts. She should look at some form of insolvency advice herself otherwise the poster's own IVA could be in jeopardy.

I appreciate David's breakdown as it spells it out clearly and as I say no one should be able to work out who the poster is from the information in his answer.

Hi Michael

There was no need for that level of detail.

There was a sense that HB were unfortunately getting it on the chin rather unfairly and even I could see the figures didn't make sense.

Even if the client discloses there is still a common law of confidence that applies to individuals that may think they know their identity.

If this happened in he environments that I work in the member of staff would be up for disciplinary.

It's unfair I know but that's the way it works.