What would the next step be? bankruptcy?

[TJKKB]

Hi, my wife was made redundant at the end of November. Since then she's been looking for work but not had any luck so far. Originally our IP told us that the redundancy money she got - which was the equivalent of approx 5 months salary - should be used as a substitute for her wage and once she got a job anything left would be reviewed. I've just had a (stroppy) phone call from someone at the IP to say they want the statuatory element now, which is all we've got left. To be honest we have spent a bit more over christmas than we should just because we knew we could balance it out over the next couple of months but that's only the equivalent of about 2 weeks wages. Where should we stand with this? There's no way I can give them what's left until she starts earning. What would the next step be? bankruptcy? Thanks

[MelanieGiles]

Hi there

What do you mean by the statutory element? This money should be directly used to supplement her lost salary, so you should have taken the five months money and it should last you until April 2008, unless of course she finds a job in the meantime. During this period you are therefore still required to make ongoing IVA payments.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

To have me propose an IVA for you, please visit:
http://www.melaniegiles.com/ivaEnquiry.asp

See customer feedback at:
http://www.iva.com/iva_companies/IVA_Advice_Bureau.asp

[TJKKB]

Hi, her total gross payment consisted of different elements: Statutory redundancy, notice payment, final months salary. The statutory element made up about 50% of the nett payment and the IP is demanding that value. The problem is that money is all that's left to last us through the next 3 and a bit months. so no way can we pay it to them. 2 other people at this company have told us exactly the same as you prior to christmas, but the extremely unhelpful person who called me today refuses to accept this and is insistent that this money is paid immediately. There's no issue continuing to meet our normal payments over this period as long as we have this money to replace her regular wage(until she gets aother job, hopefully soon, and the people we have spoken to previously have already advised that anything left after she starts getting paid is classed as a windfall and is payable to them. That's totally understood and not a problem but if we make this one off payment there will be nothing left after monthly direct debits (that take up my entire income) to buy food, groceries, fuel etc. My question was really are they correct? And if so what next? they're definitely not getting that money regardless of what they threaten us with so does that mean bankruptcy is the next step from them?

Thanks

[MelanieGiles]

Speak to the IP personally, and get advice from the horse's mouth - especially as you have had conflicting advice so far.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

To have me propose an IVA for you, please visit:
http://www.melaniegiles.com/ivaEnquiry.asp

See customer feedback at:
http://www.iva.com/iva_companies/IVA_Advice_Bureau.asp

[TJKKB]

Thanks for the advice. Never actually spoken directly to the horse. It's DFD and you deal almost exclusively with call centre staff - just got off the phone to the stroppy one who says we're now in breach and she'll be informing the supervisor immediately. Although she did then admit she's not qualified to answer any of the questions I raised and she's "just the messenger". Will advise what happens next.

Thanks

[TJKKB]

PS - so that I'm prepared for the worst - if anyone knows what the next step is if we are in breach any advice would be much appreciated.

[MelanieGiles]

Hmm - call centres in professional IP practices, where you cannto get to speak to the IP personally. Sadly this seems to be the way this profession is moving towards, but I personally find it extremely frustrating to keep hearing these comments about a few particular firms.

And what an admittance that they are not qualified to deal with your query, but will not let you speak to the person who is? I suggest you locate your IP's personal e-mail address (found on the Insolvency Service website under "Find an IP") and see if you have more luch there with your communication.

If you are in breach of the IVA you have two choices - remedy the breach, or see the arrangement terminate. The latter could result in you being declared bankrupt, depending upon the terms of your IVA and the amount you have paid over.

Do you have any way of paying off the arrears - could friends or family help - or do you now feel that bankruptcy may well be a better option?

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

To have me propose an IVA for you, please visit:
http://www.melaniegiles.com/ivaEnquiry.asp

See customer feedback at:
http://www.iva.com/iva_companies/IVA_Advice_Bureau.asp

[TJKKB]

I don't agree that we're in arrears, we're making all of our regular agreed payments. It's just their definition that part of my wife's redundancy payment is classed as a windfall (i.e. the remaining money, equivalent to 3 months wages) and as such has to be paid immediately. I've refused to pay it because that would leave us with nothing, and we would then end up having to go into arrears with the mortgage, regular IVA payments etc which just seems madness when there's cash in the bank to enable us to carry on as originally agreed. And as I've said to them we've no issue at all with paying them what's left when she does get a job but we've just gone through 3 weeks over christmas when no-one's recruiting. In their words that's not their problem. Apologies for rambling, just extremely frustrated at the mo, her supervisor was supposed to call me back an hour and half ago....

[MelanieGiles]

If you cannot get this sorted out with the IP, their regulatory body has a great arbitration service which helps to resolve disputes such as this. I suggest that you put your IP on notice that you intend to refer this matter to them if you get no joy over the next week or so.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

To have me propose an IVA for you, please visit:
http://www.melaniegiles.com/ivaEnquiry.asp

See customer feedback at:
http://www.iva.com/iva_companies/IVA_Advice_Bureau.asp

[TJKKB]

Thanks very much for your advice Melanie, it's much appreciated. I'll let you know how it all turns out.

thanks

[Kes]

I feel for you & hope this gets resolved to your satisfaction. Good luck and please let us know what the outcome is. This could be a victory worth sharing to encourage others who find themselves in a similar situation. Fingers crossed.