www.iva.co.uk

Hi all

I've just discovered that the bonus' i've been paying haven't been reducing my overall amount owed. I really had no idea and i'm quite gutted. I'm sure to some of you that have this provision in your IVA you might have already known this, but I just wanted to make sure that others are aware.

I've carefully kept a track of what i've paid and had even had conversations with my IVA company where they've told me its coming off the balance, but apparantly this was wrong. It makes me feel sick that i've paid over so much and essentially this is to 'enhance the dividend to my creditors'.

This has only come to light since my Mum is looking to help us with a full and final offer and I really hope it goes through and is accepted. I feel like the goal posts move sometimes and there is nothing you can do about it, you just have to deal with it.

I'm struggling to find the bright side on finding this out, well other than hopefully a f&f being accepted later on in the year. [:)]

Kate

I've just found an email from my IP at the start of the IVA telling me any payments from bonus comes off our balance, so i've forwarded this now and am hoping it was their mistake.

[:)]

Dont forget - you will ALWAYS OWE the full amount + fees until the end of the IVA (NOT THE AMOUNT STATED AS DIVIDENTS)- it is only then that the remaining money is written off.

A quick reread of you proposals would have indicated this to you

If I have an email from my IP I would trust it! if you ask a person a straight question and get a straight answer then I don't really see your point.

I have read my proposals, although to be honest sometimes it can be hard to understand. thats why I asked the question in the first place.

I guess it comes off the balance of the original amount owed but it would never reduce the term.

The original proposal would have stated this so unfortunatly as frustrating as it is (with you having this email) it will have no impact im sure....

No. Unless you manage to pay back 100p in the pound plus fees you will always owe the full amount of your debt and the IVA will carry on the full term.
Any overtime, bonuses etc paid over are just to increase the dividend paid to your creditors.

this is the question I originally asked...

"With our bonus' we could be paying as much as £1000 a year, could we complete the IVA quicker then? its just a case of waiting until all creditors have received 51p in the £1?"

My IP's answer to this was yes.

If this isn't the case I do feel somewhat mislead. I understand what you're all saying but i've got this in black and white.

I do see what your saying... I guess it depends when you asked the question they could say with the bonuses and potential pay rises you could hit 100p....

I have never known an IVA cease once you have hit the agreed dividend- you will always continue on until you have completed the term, or until you have paid back 100p in the pound whichever is sooner.

Hopefully one of the experts can come on and advise.

I asked my company about this for me & my initial amount is 33p/£ they stated any bonus will raise this amount & benefit the creditors. Kitkat I'm sure your IP will look to resolve this. Is it email or official letter? As email is not as concrete as a letter on headed paper.

kallis3 wrote:

I have never known an IVA cease once you have hit the agreed dividend- you will always continue on until you have completed the term, or until you have paid back 100p in the pound whichever is sooner.

Hopefully one of the experts can come on and advise.

How does a f&f offer work then? as thats not waiting for the term to complete or giving back 100p in the pound? this really confuses me as what's the point in agreeing a dividend? have I got the wrong end of the stick?

The divident mentioned in the IVA - assumes Nothing changes during the term of the IVA.- and is based on disposable at that time. But it IS NOT FIXED.

However if income falls or increases or there in a inheritance or a lottery win, all those things will change the amounts of divident given to creditors.

A f&f is usually an amount a relative can give you to end the agreement. Until your IVA ends you owe your full debt. For most of us they are writing off half of the debt. The dividend is what you can pay back at the time the agreement starts. If it goes up the creditor benefits and if it decreases there may need to be a variation meeting. In essence a dividend is not a set amount that if you paid up after 2 years your IVA would complete, unless through a f&f. For example mine is set at 33p/£ but with bonuses and pay rises that may rise above 40p/£.

I was going to add that the bonus and overtime go towards your 0p/£ and increase the amount you pay back, over the last year i paid £1k in overtime towards my IVA, the more my creditors get back the better it is in the long run.

Apologies. I meant to say that I hadn't included a full and final in my reply. I meant that I hadn not heard of it happening in a normal iva.