www.iva.co.uk

I just received my third annual report from my IP. In it it mentions that they have convened a Creditors meeting to seek creditors approval to take additional remuneration for Time Costs outstanding and future timecosts to be taken on a timecost basis. The original agreement had the fees capped at £5000 which the IP has already taken. I am totally up to date on my repayments, the only contact I have had with the IP in the last 2 years is to submit my annual Income and Expenditure accounts which were agreed. There have been no problems with my IVA at all which would warrant this additional work, in fact my re-payments are far exceeding the original minimum dividend to creditors as I have been earning a lot more than originally expected. My questions are 1) Is this normal? 2) Why is the IP doing this when there has been no additional work? 3) Can they do this without asking me first?

Hi
Time cost charging has been phased out by creditors now,your IVA has been agreed when this was the norm.
Basically they have used up the 5k that they were alloweed to charge for your IVA so have to go back to your creditors for approval to take further fees.They do not have to ask you,it will be upto your creditors.
Do not be surprised if your IVA has to extend in order for the extra fees to be paid and your orginal dividend met.
Regards

Hi Andy - thanks for the speedy reply. I am already paying almost double a month what was in the original proposal and if this continues will far exceed the original minimum dividend. In this case is my IVA likely to be extended if the funds are there to pay the 'additional' IP remuneration and meet the original minimum dividend?

Hi
No I doubt it
Keep us posted as to how you get on
Regards

As long as the IVA is not extended you needn't complain about this, it's between the IP and the creditors as to whether they agree to it, the IP's fees come out of the creditors' pot.

The time you should complain is if it appears that due to the Supervisor's demand for extra fees there is a possibility that the agreed minimum dividend might not be met, however, you've already pointed out that this is being significantly exceeded due to your additional payments. You might also become concerned if there is any likelihood creditors will get paid in full due to the high level of payments. If this were to happen, then effectively you would shoulder the burden of the Supervisor's fees.

If you think this is a possibility, then you should ask your Supervisor why they feel that the fees should be increased.

Thanks Phil - it is unlikely that the debt will be paid in full - but it is likely based on current monthly repayments, that I will pay back about 60p in the £ when the minimum dividend is 32p in the £ on Creditor claims of 110K. The additional fees they are asking for are 3k for timecosts outstanding and future timecosts.

As a party to the IVA you still have an interest in what is paid to your IP, but under today's fee pressure I would think it quite unlikely that this proposed amendment will be accepted. Your IP will have to justify the addional work that he has carried out, and the reasons for this.