www.iva.co.uk

myself and my wife are in an iva, we have been in now for 2 years, last november we had a change in our payments because we couldnt afford what they said, which was fine, so we dropped down to a level we could afford and the iva was extended by a year. but the creditors have put a 50% variation on us, which would mean any extra money we had per month we would pay them 50% of it. but in my case my salary changes monthly because i do shift work they are saying the variation is for overtime which i dont do, we were told last year that this extra money would just shorten the life of our iva, but in reallity we have been told the creditors keep it as extra, it seems to me that this is a backdoor way of them getting back some of the interest.

could someone please advise me if this is correct, because before we did the iva we paid people regulalry even though we couldnt afford it which included the interest, so im very unhappy that any so called "extra" money, like payrises etc. they are gonna swallow up and its not going to shorten the iva life. they have agreed a figure of £1325 per month to be paid till march 2012, so if i am paying that amount per month, why are they wanting more at the review stage and why do i need a review as i have agreed to pay this money. obviously if we had a windfall then thats different i would pay them and give them the 8% which it states in my iva.

it just seems to me that we are getting squeezed by them, and at this rate i am thinking of going bankrupt and that way nobody wins, cos u please give me some advice on what direction to go, i have spoken to our iva people and they are looking into it as well, but i wanted some outside advice as well.
thank you for any assistance

Hi there and welcome.
A lot depends on your proposal and what it says concerning overtime and pay increases. The norm is usually that 50% of anything earned in overtime goes to the creditors and yes it does mean they get that bit extra back, but only extra on the amount agreed in the proposal, you also get to keep the other 50%. It can somewhat depend on what you are paying back. I started with a return of 32p in the pound and the expected dividend now through our overtime extra payments is 34p in the pound. Still a lot less than the original amount of debt that I had. The review would also be in your proposal and is something that you would have agreed to. It can work both ways though, as you can also recoup some of the extra earned in rises in expenditure. Not a lot goes down.
I would read your prop[osal and see what it says about overtime and rises in income. Mine is a straighforward 50% of anything extra. Some take all of payrises but only the 50% of overtime.
I hope this helps a bit, I can ramble on a bit.

Ang

HI
You were miss informed regarding extra money shortening the IVA.This only happens once you have paid the full original debt and IP fees.
Paying 50% of overtime and commission is a standard term for nearly all IVAs
Regards

Andy is absolutely correct - who was it that gave you this information? Surely not your IP or a member of his/her staff?

Thanks for your replies.

Just to clarify. The amount that we are playing will give the creditors a return of 100p in the pound. We will also have paid the IVA fees. That was why we were told that any additional payments would shorten the term of the agreement as interest was frozen unless we received a windfall.

Hi

You have been in the arrangement for sometime and made good contributions, and whilst you may not be in the arrangement that you believed you entered into you are a fair way down the line.

I wouldn't do anything too hastilly - but suggest you contact an expert to review your specific situation and await a reply from your supervisor


All the best Alan

www.debtdr.co.uk

If you are paying 100p in the £, then the period of your IVA will definately be shortened by making additional payments.

Melanie,

yes it was obviously members of the IPs staff who gave us the advice as it was given when we were asking questions about the agreement. Also this is the second peice of incorrect advice we have been given by the company. Obviously as we are now with this company it would be very difficult for us to change.

Hi
But the advice was correct as you are repaying 100% of your debt,any over payment will shorten the life of your IVA
Regards

Hi Andy

Yes that's what we thought but we are now being told that it won't shorten the life of the IVA so basically we are confused!!??

You will only pay 100% of ebt + IP fees + 8% stat interest - after that they cannot ask you to pay more! Justthink of the satisfaction knowing that everything has been cleared - I am in the same position - by the time our IVA finishes we will have paid 108% back- but boy will I feel proud of the achievement!

Hi
When we advised that you had been given wrong info it was presumed that you were not returning a 100p dividend,very unusual in an IVA.
Any extra payments will shorten your IVA unless your IP fees increase or creditor claims increase
Regards