Fed up with my IVA IP

[LairdM]

Hi,
Just been having a couple of arguments with my IP and would like some advice.

As I understand it, the term of your IVA is fixed, unless you own a property and there was more than £5k equity trapped in your mortgage where it can be extended form 5yrs to 6yrs, but I have never owned any property, so if due to unemployment you miss a few repayments, can they extend the term of your IVA to recover the missed payments?

Also, they have declared that Statutory Interest is payable if I am able to complete my plan within the term, but as I project that if I keep up my payments at the current rate that I can afford, I would still owe at least £400, can they apply SI?

If it was possible to transfer my plan to another IP without having to start all over again and losing the £17k I’ve already paid over the past 41 months, I’d tell them to stick it!

Feel like just packing a rucksack, finding some remote Scottish island and building a log cabin...

[Foggy]

Yes, they can extend the IVA term to recapture missed payments -- the term is not strictly 60 months, but 60 Payments of an agreed amount.

Yes, you are liable, if you hit 100% of debt and fees, to pay statutory interest. Currently this is 8% per annum simple, based on the reducing balance. Sometimes the proposal will specificalle exclude S.I and, if not the creditors can be asked to exclude it in a variation meeting (it has always seemed unfair to penalise someone for being able to pay off the full debt !) --- of course, they might not agree -- but the question could save a few thousand pounds.

I am afraid any other IP would be doing the same -- though some might be a bit more sympathetic in the application.

[Michael Peoples]

Check your proposal thoroughly to see if statutory interest is mentioned and also read the chairman's report. If you do manage to repay the debt plus costs during the IVA then there may be SI to pay but the term cannot be extended to collect this. It can be extended due to missed payments but not to punish you for paying in full. You should make sixty payments in total.

[LairdM]

Thanks guys.

Given that I have no spare cash (due to being in an IVA and the instability of IT contracting), I doubt I'll ever be able to pay the full sum off the way things are going, unless my long lost Uncle Dave dies and leaves me his diamond mine, so why they keep harping on about SI is beyond me...

[Foggy]

Good old Uncle Dave

To be fair, at least they have mentioned it ( albeit annoyingly). To many it comes as a total surprise !

I was lucky as my proposl was drafted in such a way as to exclude S.I from the off --- if I were ever to enter another IVA I would make sure the same thing was done again ( just in case).