www.iva.co.uk

Hi all I am looking for some advice on a possible IVA.

As I mentioned in an earlier post I live with my partner and 2 year old son in a rented house which is in my partners name. All of the bills etc are also in her name with only my personal mobile and sky accounts being in my name. I basically give her half each month in cash or a bank transfer. I have enquired about an IVA and was told my partners income would need to be declared on my proposal and I will need to provide proof of her income and also show her bank statements.

Here lies the problem, when I discussed this with my partner she was not happy. She wants absolutely nothing at all to do with the IVA and does not see why she has to be involved. I understand her point of view, and she says she is not getting involved at all.

I am at my wits end, I understand her stance on the matter as all the debts were mine before we got together. What should do??

regards

Mark

Usually Mark all they want to see from her income etc is that she pays her fair share of the bills, if she earns 40% of the household income then she would be expected to pay that and the other 60% of the house expenditure would be acceptable for you. This is to work out your disposable income. It wont matter who's name the bills are in.

Ang

Hi mark and welcome to the forum

If you are to successfully propose an IVA to your creditors, you will need to demonstrate that you are only paying a fair share towards the household bills which, when you are living with a partner, is usually based upon you paying a proportion of the shared expenditure in the same ratios as you earnings - hence the need for the IP to have evidence of your partner's earnings.

I personally see no need for her to produce her bank statements, but the utility bills for council tax and water rates will need to be produced.

It is a shame that she feels unable to help you, and it is not a case of her income being taken to pay your creditors, more the establishment that you are paying the right share of the joint expenditure.

thanks for your help guys,

I am going to have to dig out copies of the utility bills and hope they will do. To be honest I earn quite a bit more than my partner but she is happy for me to pay only 50% just so I can meet debt repayments.

As you are all aware these matters put a lot of strain on relationships and I suppose It is just her way of saying she has total control on her own finances and what she spends her money on. I know she is not trying to put a damper on the IVA just for the sake of it as if I paid a % proportion of the bills I would probably be at nearer 65%.

thanks for all your replies

I would say that the IP only wants to know what your paying in out goings. This will form an account of what you can afford.

To be honest you partner shouldn't need to get involved. If the debt is yours alone, then it's your responsibility.

If your struggling to find an IP then try another firm, or better still one of the debt charities.

If you should be paying a higher contribution due to your salary, but your partner is happy to only take 50% - she is already co-operating with your debt problems.

If I were your IP, I would still want to see details of her salary and the utility bills, but apart from that she would not be involved or named.

Melaine

I can see were Marks partner is coming from, you know my situation from other posts.

My partner, who i am with now, accepts i am in IVA, supports me, but i went through the iva process just before i met her, and she does not want anything to do with it and i accept that and understands that becuase the debts were down to things that had happened before her, and the way i see it why she should have to get involved when its not her porblem and especially since she did not gain from debts.

Most important thing i happy with that, cause its not her problem, and we love each other for who we are , not about money.

For that reason we live separtley for now, the daft thing is if we could live together now and i didnt have to involve her include her not having to prove her salary the creditors would probably get more money, but i suppose its one of them things in iva

James

I have watched your story for some time, and really feel that you and your partner are suffering (and paying two lots of costs) as a result of misunderstandings about the way IVA income and expenditure is worked out.

Your partner's income is only taken into account for the purposes of determining what ratio to share shared expenditure. And to be frank, whilst creditors are extremely interested in fine tuning and grabbing every spare penny at the date of the creditors meeting, the reality is that they very rarely take interest in the review process post-IVA - indeed I often wonder if they actually read the annual reports I am my fellow IPs laboriously issue.

You could also argue that you and your partner pay the bills on a 50/50 basis regardless of salary, so now you have those two bundles of joy which I am sure you will want to spend every minute of your spare time with, is it not time to take stock of things, have a chat with your IP and see if you can get back under the same roof, whilst continuing your IVA payments and keeping your ladies happy?

MelanieGiles wrote:

James

I have watched your story for some time, and really feel that you and your partner are suffering (and paying two lots of costs) as a result of misunderstandings about the way IVA income and expenditure is worked out.

Your partner's income is only taken into account for the purposes of determining what ratio to share shared expenditure. And to be frank, whilst creditors are extremely interested in fine tuning and grabbing every spare penny at the date of the creditors meeting, the reality is that they very rarely take interest in the review process post-IVA - indeed I often wonder if they actually read the annual reports I am my fellow IPs laboriously issue.

You could also argue that you and your partner pay the bills on a 50/50 basis regardless of salary, so now you have those two bundles of joy which I am sure you will want to spend every minute of your spare time with, is it not time to take stock of things, have a chat with your IP and see if you can get back under the same roof, whilst continuing your IVA payments and keeping your ladies happy?

I think it's true to say that post IVA, there's less support across the board. Of course you get one on one treatment when signing up, but post approval it's either automated or handled by call centre staff who have hundreds of other cases on their books. I think this is one part of the debt management process, at least as IP proffesionals are concerned that needs a review.

It's a business at the end of the day... bums on seats and all that, which can be a conflict of interest for IP's and there customers, present company excluded of course.

It is important that good communication eists throught the full term of the IVA. It will stand greater chance of succeding as a consequence.

Please don't tar us all with the same brush. I do not employ any "call-centre" staff, and all of my cases are carefully managed by experienced and well-trading professional staff from start to finish.

The ongoing supervision of an IVA is largely an automated process, but IPs should never be too busy to deal with the individual needs of their clients, or offer support where it is necessary.

I actually think that the majority of practioners follow similar guidelines to my own, but it is a shame that the large operators seem to attract so much criticism which then tends to tar the profession generally.

I can back up what Melanie says about IP's offering a "personal service". The firm I am with, although it is only a small firm, are so approachable that we even had a conversation last year about rugby, which we both share a passion about!

Yes, I'm sure the "factories" as people call them are a lot more structured and rigid, and it can sometimes look like a "robotic machine" process, but the majority of IP's are extremely approachable, and emphasise with your individual circumstances.

Can I just add my experience into the debate.
My partners income is being taken account into my IVA. When I was going through the initial phase, I was told she would have to do this because 'the proposal would not accepted without her contribution' and 'she benefitted from my credit' (which I contested as most of my debt was obtained before we met). As it is, she is now paying part of her disposable income into the IVA. I only wish I had found this forum earlier and I may have stood my ground over it.
I am now having sometimes heated discussions with my 'advisor' (not my IP who has never once accepted my call) that her recent pay-rise should be included in my IVA.
My advice - pick a small, personal firm as Melanie and Chris have advised and stick to your guns regarding anything which you think compromises your partner.

My husband's earnings were only taken into account, to make sure the household was being split 50/50. All the debts were mine, and i pay my IVA, my husband's earnings are his own.

Hi Mark

My position on this topic is that for practical purposes it is necessary to demonstrate transparency and that your partners income has not been "ringfenced" i.e you are not bearing all the expenses whilst your partners income provides the good life!

The downside of this of course is the potential for one of the creditors to see your partners spending money as up for grabs. It may result in unrealistic demands being made by the creditors. So long as the proposal clearly sets out the position and the apportionment of expenses is seen to be fair, you can reduce the risk of that happening.

However you attempt to structure things, whether or not she directly contributes or not, your partner is going to be affected by any IVA you enter into even if it only extends to putting a ceiling on your ability to contribute to the domestic budget. In that case the IP should:

1. Obtain her confirmation that she is aware of you entering into an IVA
2. Get her confirmation that she is aware it may have an (indirect) impact on her and that she ought to be ssking independent advice on the matter
3. Get her confirmation of whether or not she has elected to take such advice
4. Get her consent to you entering into the IVA.

Unless the IP has dealt with those points he/she hasn't really dealt with his/her professional obligations towards you and your partner. Arguably, without her consent, your IVA may well be be unworkable from the outset.

Ian

Ian is absolutely right in everything he mentions, but part of the problem that we have these days is partner's income needing to be taken into account to meet unrealistic hurdle rates and creditors demanding the partner's surplus or rejecting proposals on the basis that they feel the non-insolvent partner has benefitted from the debts.

This is something that probably should have formed part of the IVA protocol reviews (as well as the treatment of pensions which is another of my favourite topics at the moment) but was missed. It is simply not right for creditors to demand the partner's surplus, but sadly this is becoming more and more common in this industry.